Solving the Biggest Healthcare Problem: Paying For It

The healthcare system in the U.S. can be difficult to understand, and there’s no shortage of companies selling solutions to healthcare access or helping people understand what they need. Arguably, there’s a shortage of companies that do so with any success. Industry experts Adam Stevenson and Chris Ellis were so well-versed in just those difficulties that they decided to start a business of their own, focusing on helping cancer patients iron out healthcare troubles so that they can focus on healing. In researching the issue, however, Stevenson and Ellis found out that the main complaint among cancer patients wasn’t about access to healthcare but about paying for healthcare.

As it turns out, that’s the main complaint about healthcare in general. Following their research and wanting to do the most good, Ellis and Stevenson looked hard at how the U.S. healthcare industry handles payments and innovated a unique solution. This new platform, called Thatch, is a common-sense way for employers to provide their workforce with more control and better coverage.

It Shouldn’t Take an Expert

Stevenson and Ellis understand the business more than most, and they’ve got enough expertise across enough industries to innovate solutions to problems like this one. They noticed that the health insurance industry seemed to expect everyone to be experts, which isn’t how things should work.

Stevenson spent seven years working on financial services infrastructure through Stripe and spent 6 years working in health insurance prior. Ellis worked with Sophia Genetics to sell clinical software and has experience in interpreting clinical informatics for Agilent. They feel that those struggling to find and pay for healthcare should only need to be experts in getting better.

“We think it’s crazy that we all just accept that paying for healthcare sucks. We believe this is fundamentally a fintech problem, and one that can be solved with great technology.”

The way the U.S. healthcare system deals with payment is to offload the burden onto insurance companies, which are mostly administered through employers with overburdened HR departments, assuming they have an HR department at all. Stevenson and Ellis took an even closer look at small businesses and startups, an underserved demographic.

“Dealing with benefits is hard and expensive for businesses,” says Stevenson. “This is particularly true if you’re a busy founder without an HR team.” It’s up to the company to negotiate everything from prescription costs to specialist access, which companies don’t always execute well and which employees have no say over.

How Thatch Solves Healthcare Payment

“The underlying healthcare payment rails—the alphabet soup of HAS, FSA, and HRA—already exist,” say Stevenson and Ellis, who became experts on ICHRA laws in particular. These laws let companies grant greater control to their employees. The main barrier between a company and the benefits of ICHRA laws is their sheer complexity, which often pushes companies away from using them or ends with them failing to take full advantage if they try.

“There’s been all this innovation in FinTech over the last 10 years,” says Stevenson. “It’s just a matter of leveraging new technology and better design to make these things easier for everyone to use.” Thatch's platform is designed to streamline access and use of ICHRA laws so that companies of all sizes can use them fully, even without an HR team to interpret them.

Ellis and Stevenson even use Thatch to provide healthcare to their own employees. They set a fixed allowance, allowing employees to choose their health plans and create outcomes. It frees their HR department from the need to negotiate plans and lets employees directly control their coverage.Thatch is a tech-based solution to what they believe is a tech-based problem. Insurance and healthcare access have gotten tangled up in knotted industry networks. Thatch intends to detangle the problem and deliver direct solutions to employers and employees.