Startup Helps Health Insurance Cards Go Digital

In an era of e-tickets, bitcoins and app-based banking, it seems pretty antiquated that we still have to fumble through our wallets for an insurance card each time we go to the doctor's office. But USA Today reports on a Philadelphia-based start-up that has a plan for making those flimsy pieces of cardboard digital — and the upside isn't just the potential for going paper-free.

With the rise of high-deductible plans, patients are increasingly on the hook for more of their medical expenses than they've ever been before. For patients, that means a bigger need for tools that provide more transparency about health care costs. And for doctors, particularly independent physicians, said Medlio co-founder and CEO David Brooks, that means a growing problem with collecting payment.

According to a 2007 report from McKinsey, hospitals and providers usually only collect about 50 percent of the postinsurance balance (or the amount owed by the patient beyond what insurance covers or what they pay at the time of treatment). That's not because patients are inherently delinquent, Brooks emphasized, it's often because they're either too confused about what they need to pay or they don't believe that they were billed correctly.

The company, which is part of the new Dreamit Health start-up accelerator, said the first version of its app is still a few months away. But the initial plan is a free mobile app that enables patients to check in from their smartphones. Instead of handing over a physical card, patients would use the app to provide doctors with their insurance information and the app would automatically verify insurance eligibility for the provider. Medlio also intends to give patients an estimate of their treatment's cost before they receive it, and it enables patients to initiate (and doctors to collect) payments directly through the app.