Fay Rotenberg, Firefly Health, on blowing up the annual visit in favor of proactive care

Fay Rotenberg and Firefly Health think that digital-first care needs to be more than just convenient, it needs to be valuable and cost effective. Together with the founding team of Andy Ellner and Jeff Greenberg, Fay is trying to replace the “old approach” where the physician’s office was the center of care delivery with a model that puts the patient at the center and surrounds them with a leveraged care team that uses a digital-first, proactive outreach approach. Benefiting from years of Andy Ellner’s research at HMS Center for Primary Care, Firefly is aspiring to deliver “concierge medicine at scale”. In April of this year, Firefly completed a $40M Series B raise, led by andreessen horowitz, to continue expanding their virtual-first specialty network and to launch a health plan offering.

In this episode, we discussed:

• Fay’s experience joining Firefly and the insight that led Andy and Jeff to found the business
• Differentiators in the Firefly model — thinking about not just who engages with the patient, but when, how, and with what tools at their disposal
• The launch of Firefly’s new health plan model which they believe can align the financial incentives of Firefly and their small group employer customers

2:00–7:00 — Firefly context and Fay’s experience joining the team

• On the common thread that ties Fay’s experiences together: Fay’s obsession in healthcare is eliminating “bloat” from the system. She recounts an approach she took earlier in her career to address this same issue by building a tool to fill excess capacity in hospitals, either from cancelled appointments or with additional virtual visits. While the results were good, Fay acknowledges that it didn’t address the issue of whether that visit was even necessary in the first place. This theme recurs throughout our discussion — the difference between solving for convenience, which Fay dubs the first wave of digital health solutions, and solutions that solve for value.
• On what Firefly is and does: Half price healthcare that’s twice as good clinically and emotionally — that’s the Firefly mission. To tackle this ambitious goal, Fay describes how they started as a virtual first primary care and behavioral health provider that eventually layered on low level specialty care and navigation services to further improve the cost and quality of care delivered. Fay lights up as she reveals the next step in their vision — to become a health plan. By adding this coverage, Fay and team hope to bring that “half price” financial alignment alongside the clinical and experiential outcomes.
• On the founding of Firefly and how Fay got involved: Firefly was founded by Andy Ellner and Jeff Greenberg in 2017. Previously, Andy had founded and ran the Center for Primary Care at Harvard Medical School where Jeff was also affiliated. The insight that they had while working at HMS that ultimately led to Firefly, as Fay recalls, was that the care delivery system was built for the 19th century when chronic diseases were treated with singular, episodic visits in physical locations to prevent death or serious illness/injury. Since then, 1) the science has changed on what’s best for patient long-term health and 2) tech adoption in healthcare has radically expanded the possibilities for care, yet the systems that provide that care haven’t fundamentally changed. The system still follows a primarily episodic, brick & mortar model, Fay believes, because there has been a tremendous amount of capital invested in building that system to what it is today. Firefly is a new model built around longitudinal care that includes more frequent digital/virtual touchpoints and more coordination across primary, behavioral, and specialty care.
• Fay describes the story of meeting Andy at a dinner in 2017 or 2018 while sitting at the same table as Elizabeth Holmes. After being intrigued by Andy’s vision, she began spending more and more of her time focused on the company until she eventually left the venture world to become president and, more recently, CEO.

“Our healthcare system was built for the 19th century where the vast majority of death, disease, and cost were driven by things that could be treated in singular episodic visits, physical places. Fast forward to today, the vast majority of death, disease, illness, are behaviorally driven, require continuous touchpoints and a longitudinal model of care“

7:00–23:00 — Firefly’s differentiated approach to care

• On the results they’ve achieved: The core of their model is a virtual care offering that Fay describes as empathetic and relationship driven. Fay attributes their higher engagement to the trusted relationship they’ve built, which can ultimately lead to better outcomes and lower cost. Fay goes on to list their outcomes — having already achieved the ‘twice as good clinically and emotionally’ relative to commercial averages, they are still working on the half as costly piece, where they’ve achieved a 25–30% cost reduction for these chronically ill patients. It’s the scale of these results that ultimately convinced Fay that they needed to become a health plan to be able to pass these savings to their consumers and to align financial incentives to perhaps even drive costs down more.
• On the care model composition/ operations: Fay outlines the key components of the care team: MD, NP, a health guide, a BH specialist, and a consulting psychiatrist all with varying leverage ratios across teams, some with expertise in a particular disease state. In a hypothetical diabetic patient situation Fay walks through how proactive outreach from health guides and from remote patient monitoring act as the first line for health maintenance that is convenient and builds patient trust in the team. Fay says that it’s this trust that earns them the right to navigate for the patient when they do actually need physical or in-person care. Fay re-emphasizes that the real differentiator here is the relationship.

“And I keep saying this, but I don’t think I can hammer it home enough. But it’s through the relationship that we built with our patients that we earn the right to navigate them and become that first place they turn for any care.”

• On their virtual-first specialty network: Once the primary care model was under control, Fay describes how Firefly worked hard to build a purpose-built specialty network that includes individual specialists working directly on their platform, virtual centers of excellence, individual digital health companies, and even physical locations (e.g., OBs, PTs, urgent care centers). Their network includes 120 of those partners today and the ability to stitch this together in a thoughtful way around their patient panel has been an area of significant advantage they think they can potentially leverage for not only their members, but also as a rentable network for other digital health builders.
• Fay gives Jeff Greenberg the credit as the mastermind behind the network development strategy — they started with the “baseline” which Fay defines as the care team plus “last mile delivery” partners (e.g., EMTs, nurses in the home, urgent care) to ensure that you can have hands on you if necessary. Then after that was the individual specialties that are most referred to that they chose through a prioritization matrix that helped them decide what level of coverage and what model they needed to deploy (e.g., individual physician, CoE, or digital health partner).
• On the launch of the health plan offering for small, fully-insured employers: Fay outlines two products they offer to lower mid-market employers (~2500 employees and below): 1) the health plan and 2) the captive. The health plan is the same type of coverage and access that all Firefly members receive, but the captive is a way for smaller employers to save alongside Firefly when employees choose to use this model. The captive works by pooling the risk of many smaller fully-insured employers into one group that is large enough to take upside and downside risk on the medical cost of the entire group. Essentially, the captive behaves as one large self-insured employer without the administrative complexity.

“For the employee, [it’s important that] their care experiences match the experience that we already deliver to our Firefly patients, which they love — we have an NPS in the 80s. But even more than that, [that] their financial journey is going to be cheaper and simpler — our plan eliminates confusion with zero deductibles, zero copays within our universe.”

• On navigation/steerage as a way to drive savings: Fay gives an example of a patient who needs an MRI to highlight the value of the custom backend platform they’ve built to support their health guides in navigating the healthcare system for patients. In this scenario, the health guide can see the various options for the MRI in the surrounding area, maybe seeing that Shields is cheaper than the same service at Partners down the street, and can then direct book that service at a convenient time for the patient and even going so far as to provide them with insight into how they’ll get there. Fay thinks of this as removing all friction from the interaction and using this added convenience as a way to build the trust to send them to a high quality, lower cost provider. One of the key sources they’ve used to build out their own provider directory is Ribbon Health, which is an innovative data aggregator focused on providing directory, cost, and quality information for providers across the country.

“Most of the time, patients just want convenience, and they want to get the care that they need. If you do that legwork for them. They’ll often go where you guide them to go.”

• On their typical patient panel characteristics: Firefly is focused on commercial (age 18–64), but mostly for patients with some form of chronic condition and often with a behavioral health component. Fay was especially proud of the fact that they can deal with 85% of BH conditions in house, citing this as a key differentiator for their model.

23:00-End — Firefly the health plan

• On the operational challenges of launching a health plan: Instead of thinking of this as launching a totally separate product, Fay actually pushes back and says this is really just the next iteration in unbundling healthcare and starting from scratch with a new model. They began with a primary care model that made sense, then layered on specialty, and now are creating a way to finance the arrangement in a way that aligns incentives with those that are getting the care.
• How current payer customers have reacted to the change: Fay acknowledges that it’s a conversation being had and reaffirms that this is the direction they’re moving, noting that there are still opportunities to collaborate (e.g., renting virtual specialty network).
• On the broader wave of managed care organizations in Medicare/Medicaid: The new wave of companies doing this are all philosophically aligned, especially around the care model approach, but while other companies have had to pivot into providing virtual care as a result of the pandemic, Firefly has always been focused on how to use digital mediums to change care delivery. She argues that Firefly isn’t just digitizing the old way of delivering care, it’s reimagining how care should be delivered in a digital-first world and then creating an ecosystem around that. To that point, Covid has had the impact of doing a lot of the evangelizing for Firefly — it’s not as hard to convince investors and customers that virtual-first approaches can achieve great outcomes.

“On the other hand, it’s certainly a noisy market, because now everyone is claiming that they’re providing virtual primary care, virtual care. Oftentimes, it’s just virtual urgent care. And I think that that’s one of the things that we have to look out for, because simply virtualizing visits that shouldn’t happen in the first place is not going to result in the change that we need.”

• Next steps for Firefly: To take the concept of shared savings even further, Fay reveals that they’re actively exploring ways to use HSAs or other financial instruments to allow the member to directly benefit from using the Firefly model and making their care decisions as an informed, rational consumer.

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We are so appreciative to Fay for joining us on this episode of The Pulse Podcast! Subscribe for our new releases on Twitter, Spotify or Apple podcasts.