In the startup world, the more complicated the sector is, the riper the opportunity to make a friendly user interface and rack in countless dollars of venture capital. There’s Robinhood to make investing more transparent, Vested and Carta to make equity more transparent, and the list goes on. When it comes to health care, a thorny, expensive and ever-changing sector, consumer-friendly choices don’t rapidly come to mind. That’s why Jason Bornhorst and Colin Anawaty collaborated to release First Dollar, a healthcare cost savings platform with a concentrate on HSAs( health savings accounts)that targets millennials and Gen Z. First Dollar released out of stealth today with a$5 million seed round, led by Next Coast Ventures with participation from Meridian Street Capital.
Other investors consist of previous athenahealth CEO Jonathan Bush, Everlywell CEO Julia Cheek, Bright Health CTO Brian Gambs and Capital Factory.”There’s just enough healthcare-ness that makes it a little tough, that’s why you haven’t seen traditionally fintech companies go at it, “Bornhorst said , of the company’s focus. Dollar is launching on the thesis that it can help consumers get much better use out of their healthcare cost savings accounts
, or HSAs. HSAs are non-taxable cost savings accounts that can be utilized on medical costs, medical professional visit co-pays or medical prescriptions. Consider it as a 401( k), but
for healthcare. Some employers offer HSAs as an advantage, and some consumers select to open their own. Dollar works with both. “I would argue HSA is the worst marketed health care benefit in the USA, “said Bornhorst.”This benefit is wholly misconstrued and underutilized by a lot of Americans. “Dollar works on both the front end and back end of HSAs. It charges companies a regular monthly administration charge to manage payroll contributions and HSA reporting. From an end-user point of view, First Dollar lets consumers established a free account through their site and manage their money there. The company also issues
a Very first Dollar debit card, and earns money from a percentage of transactions on the debit card. Using First Dollar, a customer can see where they can get
the most savings on particular medical products. The startup is very first focusing on drug discount rates and has actually partnered with RxSaver, a nationwide drug discount rate program. Let’s talk through a consumer experience to make this more clear. Users can transfer their existing HSA to First Dollar or produce and money a First Dollar HSA. The First Dollar account will reveal them discounted health care product or services. Then a user can receive the discount at a local drug store by revealing the cashier a code from First Dollar.
First Dollar’s closest venture-backed rival is Dynamic, which last raised$27 million back in October for its HSA item.
The start-up similarly targets millennials with low charges and onlinemanagement, and concentrates on getting users to treat HSAs as an investment account. Per Forbes, four other fintech startups also have HSA capabilities in beta testing. Bornhorst said that First Dollar differentiates from Vibrant by concentrating on academic content and developing a marketplace for customers to find healthcare products and services at lower price points. While Lively would be more on the saving and investment side, First Dollar would be focusing more on the saving and spending side of things. Additionally, the co-founders stay positive because of their track record: Before First Dollar, Bornhorst and Anawaty introduced and sold a business
to athenahealth, a massive health care company that works with countless patients. Article curated by RJ Shara from Source. RJ Shara is a Bay Area Radio Host (Radio Jockey) who talks about the startup ecosystem – entrepreneurs, investments, policies and more on her show The Silicon Dreams. The show streams on Radio Zindagi 1170AM on Mondays from 3.30 PM to 4 PM.