Jared Dauman, Soda Health, on the Role of Technology in Eliminating Health Inequities
In this episode, I sat down with Jared Dauman, co-founder and Head of Operations for Soda Health. Founded in 2021, Soda Health is a healthcare technology company focused on reducing health inequities. Soda Health uses technology to simplify healthcare transactions, similar to retail purchases, using debit cards. This approach aims to bridge the gap between medical claims and retail payments, ensuring consumers have easier access to benefits. In this episode, Jared and I discuss his journey from working in the directed spend space at Walmart to becoming a co-founder of Soda Health, the business model of Soda Health, the integration of fintech and healthcare, the challenges and opportunities in the world of digital health partnerships, and the evolving role of social determinants of health interventions.
Jared’s Journey: From Walmart to Soda Health
Jared’s career journey began far from the world of healthcare. Although he originally wanted to be a journalist when he was in undergrad, he accepted a role in the affiliate marketing space at Jet.com after graduating from Washington University in St. Louis. When Jet.com was acquired by Walmart, he then found himself overseeing the P&L for OTC medical products and taking over a side project related to directed spend.
Through his work in the directed spend space, Jared soon realized the potential for opportunity in the space. In 2018, payers had reached out to Walmart to investigate growing spend for supplemental benefits for Medicare Advantage patients. Supplemental benefits, which can include goods such as over the counter medications, meals, and other nonclinical spend, had recently been subject to new regulatory changes, and as a result, plans were newly incentivized to ensure that members were taking advantage of their supplemental benefits. Given Walmart’s role as a consumer leader, Walmart was well positioned to help spur this change, and Jared soon found himself overseeing much of this work.
I then asked Jared about his process of getting to know his co-founders, Robby Knight and Daryl Risinger, at Walmart. Jared also noted that after the three of them left Walmart to found Soda and had raised a few million in seed funding, they quickly realized they needed to bring on a technical co-founder which led them to adding Chris Brown to their team. Jared explained that while the traditional stories around startups involves co-founders finding each other at a networking event or through an MBA class, co-founders can also be specifically sought out and brought onto a team early on in the process. The Soda Health founding team structure, with each of them fully owning their area of expertise, has allowed them to own important decisions and move quickly, ultimately supporting their rapid growth.
“I think the interesting part of that is so much of folklore around startups is that you find your founders at a happy hour, you find them in an MBA class… But in this case, founders can also be hired, can join the team very early on in the story, and can have such a meaningful impact on the trajectory of the company.”
Soda Health’s Business Model
I next asked Jared to dive into the operations of Soda Health’s business model. While at Walmart, the Soda Health team saw almost 45 million annual transactions related to directed spend flowing through the system. As national payers began to see the value of directed spend in driving acquisition and retention of Medicare Advantage members, the space took off very quickly. Despite the rapid growth in spend, it was clear that there was a lack of focus on outcomes and efficiency. Although the plans were providing the same benefits across the board, patient needs vary greatly and would benefit from a tailored approach.
“Healthcare is a highly personalized thing. You and I could be neighbors but have incredibly different needs that require incredibly different benefits. And the analogy we use internally is the movement from linear television to connected television.
If you think about 20 or 30 years ago, everybody’s watching the same six o’clock news program and everybody’s being served the same ad. Now you move into 2024 in the world of connected TV — we’ll be watching Hulu and myself and my fiance will get different ads while watching the same show.”
Just as connected TV allows for personalized ads, so too does Soda Health allow for personalized benefits. Soda Health’s smart benefits program issues a Mastercard branded debit card to members which has smart benefits applied to it. This means that the card can have benefits substantiated at the item level for members and that these benefits can progress throughout the year depending on member needs. Traditional supplemental benefits are issued once a year at the plan level; with Soda Health’s smart benefits, plans can hyper-personalize the benefits and adapt them to members’ health needs throughout the year. Lastly, Soda also pairs these smart benefits with member engagement through SMS, email, phone calls, and other methods with the goal of driving long-term engagement. Ultimately, these changes are all aimed at driving utilization of benefits with the goal of improving health outcomes and maintaining member retention.
Integrating Fintech and Healthcare
I then asked Jared to discuss the ways in which Soda integrates fintech and healthcare and how this intersection has evolved over time. Jared noted that the best way to understand this relationship is to walk through the experience of a member in one of their programs. For Medicare Advantage members, they will receive a letter with their new debit card in late December, along with an explanation of their benefits. As members then begin to take advantage of these benefits come January, they might head to a Kroger or CVS to shop. As they check out, their purchases that are covered by their benefits automatically are registered by Soda. While many of Soda’s competitors stop here, Soda goes the extra step to reach out to patients. They then may receive a text letting them know that they can get their annual flu shot in store, and that if they do so, they’ll receive an additional $15 in benefit spend. These types of smart reminders help build a longitudinal relationship that drives broader member engagement.
Jared also noted that talent plays a role in this business model and structure. Because Soda does not rely on capex spend, they’re able to devote their resources to building a great team with the different backgrounds needed to make a fintech and healthcare company succeed.
“We’ve taken FinTech, which is where we started, we brought it into the retail experience. We then engage them through SMS, and consumer marketing, and then we push them back into healthcare, so that they can experience the provider right there in their favorite grocery store. And that to us is the value of that longitudinal relationship that isn’t so focused on just the benefit redemption, but actually how we drive that broader member experience and health outcomes.”
Building Partnerships: Challenges and Opportunities
From there, Jared and I discussed the growth journey Soda has had the past few years, and the role that partnerships have played. Core to Soda Health’s business model is the idea of a two sided marketplace. For Soda, they need to have strong relationships on both the health plan side as well as the retail side. By bringing these two spaces together, they are able to drive effective growth. For Soda, this ended up being a significant challenge early on in the business when they had to develop partnerships on both sides without the other partnerships in place yet. However, by developing personas of the different specific customers they were speaking to within each retailer, they were able to better understand their needs and how to build foundational partnerships. Additionally, by simplifying the technical side of the equation and making it easier for retailers and plans to implement Soda Health’s system, they were able to reduce friction and streamline the partnership set up process.
Evolution of Social Determinants of Health Interventions
At this point, we shifted our discussion to the broader landscape of social determinants of health (SDOH) interventions and how they have evolved over time. In 2018 when Soda first began diving deep into the world of SDOH, most of the focus was on understanding SDOH needs. Nowadays, the focus has shifted to ensuring connection points related to SDOH needs are not lost. Jared noted that one of the most striking statistics he has come across is that 45% of those on Medicare Advantage who should qualify for SNAP and other food assistance programs are not registered. Platforms like Soda that help bridge the gap between consumers and their benefits are well positioned to help connect members with the resources they need. For food insecurity specifically, Soda is investigating ways in which they can smooth the process of getting these consumers connected to SNAP enrollment services and other community resources related to food.
Additionally, Jared also noted that another point of evolution related to SODH needs is the role that community can play in addressing health needs. Soda focuses on pulling in points of care, such as those with a pharmacist or within a grocery store, to drive health outcomes.
“So often we think of healthcare being something that has to be addressed in a doctor’s office. But the reality is, if you’re 65 plus, you’re going to the doctor about 5.5 times a year and spending about 17 minutes in each visit. On the flip side, you’re seeing your pharmacist 35 times a year, and you’re going to your grocery store 83 times a year. The point of engagement here can’t exclusively be the doctor’s office, there just simply aren’t enough providers to do it. The place to win and improve healthcare also has to be the grocery store or the pharmacy, because turning those points of purchase into points of care, is how we’re going to continue to develop this ecosystem that addresses SDOH.”
Career Advice and Closing Thoughts
To finish up, I asked Jared his advice for young professionals and MBAs looking to explore the healthcare and SDOH space. Jared started off by noting that when working in the SODH space, you need to be conscious about understanding the needs of the demographics you’re serving. For example, Soda decided to employ a Head of Social Care rather than starting with a Chief Medical Officer. By supporting their growth intentionally with a Head of Social Care, Soda was able to better understand products and solutions that would drive improved health outcomes while maintaining compassion and dignity for those served by Soda. Ultimately, keeping this focus as a guiding north star is key to working in the SDOH space.
We are very appreciative to Jared Dauman for sharing his advice and wisdom with us on this episode of The Pulse Podcast! Subscribe for our new releases on Twitter, Spotify or Apple podcasts.
