Will small cash rewards motivate people to be healthier? Investors say yes
The healthcare system in the United States is good at promoting, but participation is another story. A startup looking to change made money on Thursday for millions of dollars.
Digital Health App Wellth ended a $36 million C fundraising, with the Los Angeles-based company raising $76 million in total. The funding round was led by Mercato Partners and participated in CD-Venture, Comcast Ventures, FCA Venture Partners, New York Life Ventures and SignalFire.
Wellth CEO Matt Loper notes that the healthcare system is currently trying to “interact” with patients through a range of rare and often annoying outreach information.
“We are often told by doctors and nursing teams what to do, and then we get text messages reminding us to buy prescriptions or pay bills at the pharmacy. Soon, we will be overwhelmed by AI Chatbots and Care Companions.
Loper added that this type of outreach does not motivate people to achieve their care goals or build healthy habits.
He noted that, often, people interact only with the health care system when they are sick or injured – that's how the country ends up interacting in the way of a “pathological care” system. The intervention was too late, resulting in hundreds of millions of dollars in preventable costs – as well as widespread human suffering and premature death.
Founded in 2014, Wellth has developed a “daily care motivation platform” that provides users with meaningful, positive experiences every day, encouraging them to prioritize their health rather than just flooding them with publicity.
The app inspires its members to develop healthy daily habits by resonating small economic incentives with personalized nudges with their personal goals. Wellth will usually give users a small cash reward or gift card, such as confirming that they take medication or recording vital signs.
These economic incentives are the initial hooks to help people interact consistently with health, but the goal is not to pay users forever. Over time, as members develop routines and experience healthier habits, external rewards are gradually overwhelmed by intrinsic motivations, such as feeling better or wanting to stay healthy for the family.
Loper added that Wellth's app is designed to deliver daily dopamine.
“We all know the first thing we wake up in the morning, check the feeling of Instagram or Tiktok — or bing bing ing 8 hours of Netflix and think, ‘Where has the time gone?’ The main reason these digital experiences are so addictive is because they give us a lot of dopamine every time they use it, rather than flooding outgoing members of stress cortisol, Wellth achieves the same daily positive enhancement through dopamine, which is achieved through the most addictive social media interactions.
This brings Wellth's daily participation rate to 91%, even Medicare, Medicaid and dual-qualified members who previously did not comply with it. To date, the platform has attracted more than 100,000 members and users have completed more than 50 million actions.
Thanks to this sticky daily engagement, Wellth can help health programs and providers improve final metrics. For example, Loper said the platform has measured statistically significant reductions in hospitalization, emergency room and overall costs and improved key quality metrics such as Medicare Advantage Star ratings and care gap closure rates.
He said Wellth works with health plans and risk-taking providers whose care costs and quality outcomes are financially risky.
“We help to quantify the amount we can save and quality based on their actual metrics in advance. We accurately determine which member peers need to change their behavior to achieve a business case. We then bring our expenses to the risk of actually driving behavior change and ending ROI,” Loper said.
Investors seem to think the company's dopamine-driven model can provide healthier patients and healthier.
Photos: Characters, Getty Images
