Scouting Report-Medallion: Streamlining Provider Accrediting, Licensing & Payer Empanelment
The Driver:
Medallion recently raised $35 million in Series C funding led by Sequoia Capital who were joined by repeat investors Optum Ventures, Spark Capital, Elad Gil, and Daniel Gross. Also joining this round were Mario Schlosser CEO of Oscar Health, Iyah Romm CEO of Cityblock Health, and Will Gaybrick Chief Product Officer of Stripe. Medallion promises to help healthcare institutions become more streamlined and updated on the administrative level so patient care is improved, patient throughput increases and productivity of administrative staff becomes more efficient
Key Takeaways:
Healthcare administrative expenses (which include billing, patient enrollment, and insurance claims) are said to represent anywhere from 15-25 percent of the total nation's healthcare spending.
Administrative spending also includes other “insurance-related activities” such as licensing healthcare workers (doctors and nurses), background checks on healthcare staff and signing up with different insurers (enrollment/empanelment).
The U.S. spends significantly more than other nations on administrative costs, spending twice as much as Canada on administrative costs.
Medallion claims to have cut over 250,000 hours (of bureaucratic headaches) since its inception due to the streamlining of the extensive administrative process which can instead be spent on provider care.
The Story:
Derek Lo, CEO of Medallion founded the company after talking with Zachariah Reitano co-founder and CEO of Ro and discussing how difficult and antiquated the medical licensing, credentialing and certification process was. Following the discussion, he quickly came up with the template to create a process for making this one cohesive unit. His goal was to help healthcare professionals and healthcare organizations by providing operational support to alleviate the arduous administrative process many healthcare organizations face to have doctors credentialed, licensed, and background checks completed. As noted by Medallion CEO Derek Lo to Forbes, “the average time to get to contract with a health insurer or hospital is usually six months at the fastest and can take up to 2 years.”
Medallion works on payer empanelment which is when a clinician (ex: doctor or therapist) requests to be a part of a health insurance network in order to accept patients from their networks and be reimbursed by their plans. This process can be very arduous and requires the collection of data from the provider to the insurance company including such things as Drug Enforcement Agency (DEA) and/or Controlled Dangerous Substances certification, provider credentialing criteria (which often differ by payer), etc. Medallion works to decrease the time the empanelment process takes so providers become registered in-network and can start seeing patients faster.
Medallion has increased its customer base from 25 at startup to close to 100. Medallion also manages license updates in all 50 states and provides reminders when a provider's license needs to be renewed. They lessen the time it takes to get licensure approved and complete for all provider types from NPs, MDs, RNs, PAsS, LCSWs and RDss, and many more.
Payer empanelment under Medallion is more smooth and efficient, they submit the request to the insurance company and make sure the detailed information and files that are required are updated and ready to send. They also make sure the verification process from the insurance company is followed and done correctly as these often vary between companies. This process allows for providers to focus on clinical needs.
The Differentiator
Medallion is focused on providing and streamlining back-office support to providers in many areas of administration where they deal with inefficient and non-standardized procedures that vary by the state board and the insurance company that often have their own unique set of requirements. This can take significant time and effort to ensure that clinicians are registered, licensed, and credentialed properly and then properly enrolled in health insurance company's networks to make sure that a provider is paid.
Medallion bases its costs on the number of medical doctors in a healthcare organization. According to the company they have doubled revenue since November 2021 and now have over 200 customers.
Medallion’s goal is to take the burden off its customer base of group practices, health systems, and other health care facilities by doing all administrative work. Systems by Medallion and others can help fill the gap while regulators move toward uniform, standardized benchmarks so providers can fill out a single application and undergo a single process.
In addition, by serving virtual primary care practices as well as telehealth and remote patient monitoring (RPM) platforms Medallion is helping ensure that both large and small health care organizations delivering care digitally will be able to meet rapidly the current demands of an ever-growing customer patient base.
The Big Picture:
There is clearly a need for an answer to the problem of the unnecessary spending in both money and time in administrative or back office spending on healthcare in the U.S. For example, according to the Healthcare Value Hub of Altarum, almost 19% of Medicare Advantage Plan spending and over 12% of Employer-Based Healthcare spending is due to administrative costs. In addition, as noted earlier, the licensing and credentialing process can often take 3-6 months thus slowing the addition of new providers to networks and ultimately leading to fewer people getting the care they need. While some states such as Maryland have programs in place such as all-payer rate setting that helps lower administrative costs, other steps are necessary to reduce the burden. For example, as noted by Altarum, “Standardizing licensure reporting requirements for quality and safety programs and minimum criteria will promote greater uniformity and lower compliance expenses.” Given that efforts like this have been contemplated for many years, tools like Medallion’s can help providers accomplish many of the same things while long-awaited regulatory change takes place. Obviously were that to occur, Medallion and others would have to further differentiate themselves.
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