When most people think of top cities for healthcare innovation in the United States, they think of cities like Boston and Minneapolis with decades of history in innovation, or perhaps San Francisco, which is home to the healthcare incubator Rock Health. But the nation's biggest city should be added to that short list, as the Brooklyn-based company CredSimple demonstrates.
|Mike Simmons is the CEO of CredSimple.|
The startup CredSimple, which has developed a SaaS platform that offers real-time credentialing of medical providers, is a case study of why New York City is a powerful place to be for healthcare innovators. The startup recently won Credentials Verification Organization (CVO) certification from the National Committee for Quality Administration (NCQA), a not-for-profit organization. The breakthrough will help the company to roll out its software in healthcare facilities across the country to help aggregate and manage provider data and helping to bolster efficiency and cut waste.
The impact of companies like CredSimple could be huge as waste is rampant in healthcare administration. In the United States, some $361 billion annually are spent on healthcare administration--representing 14% of the nation's healthcare costs. "At any given time, if you look at the accounts receivable of healthcare organizations across the country, they have a substantial sum of payments that are tied up--worth the hundreds of billions of dollars," says Mike Simmons, CredSimple's CEO. "There is often a disconnection between providers and payers, but, in most of these cases, these are claims that should be paid but there is a delay related specifically to their credentials.
"Healthcare administration is not quite as sexy as inventing new drugs or devices," Simmons admits. But healthcare disruption is ripe for disruption. There are many things, for instance, that hold up healthcare payments, including many processes that require manual steps that take countless hours of administrative time and add significant cost.
Being in New York City provides an advantage for software companies in the healthcare administration field, Simmons explains. "We decided to base the company in New York because of Blueprint Health, the leading health-tech startup incubator for B2B enterprise health solutions," he says. "Since day one, this NY-centric ecosystem has played a huge part of our success."
Blueprint Health has played a unique role in helping drive innovation among healthcare startups albeit in a different way than other incubators like Rock Health, which focus more on products aimed at consumers.
"The big differentiator is that Rock Health has done an amazing job at marketing and B2C. But the entire focus of Blueprint health is enterprise and B2B. They are doing their own great job at developing that type of company and establish New York City as a healthcare software leader."
Simmons cites three main reasons New York City has helped the company:
- Investors and mentors. "We've met and have been supported by the mentors of Blueprint Health, an awesome community of mostly NY-based healthcare executives, practitioners, and investors."
- Clients. "Our first clients were introduced to us through the work we did at Blueprint Health."
- Partners. "My co-founder Sam Meyer was also at Blueprint Health as a founder in residence, and he joined our team in the middle of the Blueprint Health program."
In the end, Simmons says the company's team, clients, and investors investors are part of its story because they are all based in NYC--a city with experts in nearly every field imaginable. The city is markedly different than, say, San Francisco, which is mostly a software tech haven.
By contrast, New York City is a world-class city with especially important expertise in finance, commerce, and cross-disciplinary research. "That is a good foundation to build any kind of tech anything," Simmons says. "But there is a lot more here than tech. In San Francisco, when you are having coffee, everyone is talking about tech. Here in New York, we get so much influence from other industries. We have the ability to attract different types of people and customers; there are a lot of different industries have strength here."
Simmons also sees his company's New York City-based headquarters as helping the firm become healthcare accredited by the National Committee for Quality Assurance (NCQA). "The certification is an extensive process for any platform or provider regardless of location, but being in New York gave us the opportunity to have access to influencers and notable names," he says. "Soon after I started the company, I had the opportunity to meet with New York Attorney General Eric Schneiderman, where he gave me sound advice on startups and the often forgotten need for compliance," he recounts. This happened during a time when the Internet-lodging website AirBnB was in the midst of a drawn-out struggle with the state's compliance office. "The Attorney General's point was clear: just because we're a tech company and we do things 'differently' doesn't mean compliance with legal and regulatory frameworks can be ignored," he says. "This conversation was incredibly valuable in giving us a better perspective on the importance of making compliance central to our mission and maintaining a mentality to think outside the box, but inside the framework."
Learn more about cutting-edge medical devices at BIOMEDevice Boston, April 13-14, 2016.
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