17.7.08

Anatomy of ZocDoc.com: "Category Killer" for Doctor Search & Scheduling?



"I wish my industry wasn't 15 years behind." - Dr. Jay Parkinson, Myca, Hello Health

During our interview last month, Jay Parkinson mentioned Hello Health's intention to use ZocDoc.com to schedule specialist appointments for patients. Embarrassed to report I'd never heard of the company, I did what any good (read: nosy) blogger would do - visited the site.

After 5 minutes, and a fortuitously timed email from a good friend in DC asking for a specialist recommendation, I was wishing the ZocDoc crew would pack up camp and move to the nation's capital.

Then ZocDoc's Trevor Leb shot me an email with more info, and I was hooked. Yesterday I spoke with two members of the company's leadership team: Cyrus Massoumi, CEO (cofounder) and Dr. Oliver Kharraz, COO (cofounder).

The ZocDoc team has garnered an impressive array of awards and publicity since launch in September 2007, including a TechCrunch prize. After talking with cofounders Cyrus and Oliver about the business model and strategic goals, I think the buzz is well-deserved - this is a breakout Health 3.0 firm.

Anyone who wears prison-orange scrubs (NY Tech Meetup) and invokes the voice of God (TechCrunch 2007) to demo the firm earns my respect - it's about time HIT firms approach the level of creativity and scrappiness exhibited by their mainstream consumer tech cousins.

But don't take my word for it - read our interview (lengthy but worth it) and decide for yourself. That's what consumer-centric care and participatory medicine is all about, right? Using information available to make up your own mind?


Q: It's not about size, but it is about numbers. Can you share search numbers for ZocDoc.com?

A: (Cyrus) Sure. We have a little north of 25k visitors per month. The interesting thing about ZocDoc is that we're geographically constrained – an overwhelming percent of our users are in NYC, and we're growing at a rate of 20-50% per month.


Q: Are you growing without advertising?

A: (Cyrus) Yes. Minimal advertising – a lot has been word of mouth, and we've gotten a lot of really good press (Wall Street Journal Blog, NYTimes). We launched at TechCrunch last year, and they picked us as one of the hottest 40 startups in September of 2007 (Watch the presentation – I've never seen a Health 2.0 startup invoke the “voice of God” during a demo). We're self-funded up to this point (NOTE: ZocDoc has received some funding from angel investors, including former backers from Facebook, but hasn't raised an institutional round). We want to grow virally – grew 70% last month.


Q: How many ZocDoc users are leaving ratings, both self-identified and anonymous? Do you have info on the percentage of users that choose to rate anonymously?

A: (Oliver) That's an interesting question. I don't know right now how many patients self-identify – but we do read through reviews to ensure they don't include offensive content - so I can tell you early on people were more reluctant to put up their names. Now people use the rating system more because their friends use it, so they're more comfortable including names.


Q: Right now on ZocDoc I can pick a Dentist, Dermatologist, or Primary Care Physician – what are people requesting on the waiting list, and what are your plans to expand practice areas (when will ophthamology go online, for instance?)

A: (Cyrus) We're seeing requests for ortho, ENT, mental health, and general family care – lots of families want to use us for pediatricians, OB/GYN. Our goal by the end of year is to have 10 specialties live on ZocDoc. We want the 80 percent of practice areas that people go to most frequently, the other areas are sort of the long tail - we want to solve the 80 percent problem (More support for the 10-80-10 rule – ZocDoc is providing online scheduling for the Middle 80). We want as many people booking using our platform as possible, this makes it as useful as possible. That's the reason we made our API available, because the platform can enable companies like Jay's Hello Health to do things that they just weren't able to do before. Other people that have approached us with other ideas. We have people building applications for an IPhone. Our API is very broad, Jay is using it for his practice, but imagine we have a button on your IPhone where you can geolocate a doctors office near you and set up an appointment . With regard to other partnerships, we have 10 employees, we just can't pursue all these types of partnerships with this size, that's why we released the API. We also think of our function as a little more broad. We've been compared to the OpenTable of healthcare, but if you use the travel analogy, look at SABRE, which powers travel reservations – that's really our goal, to be THE platform people are using to book doctors appointments.


Q: One of the touchy areas of Health 2.0 relates to business models (or lack thereof) – tell me a bit about ZocDoc's model and revenue structure?

A: (Cyrus) Sure. Practitioners create a profile for free, but if they start using the scheduling service and such there's a subscription fee that physicians pay. The fee varies. When we launch a new specialty we make it free for a time to encourage adoption and so we can learn more. Right now practitioners use our web based calendar to make times available. We also have integrations we've built for leading practice management solutions and we charge fee to access these in addition to using the ZocDoc calendar.


Q: Tell me about expansion plans....what's your current staff strength? See you're hiring for some key positions (VP Operations, VP Membership Sales) Where do you want to be by the end of 2008? Also, you're currently only available in NYC – what other regions do you want to reach?

A: (Cyrus) We'll probably double in size - or more – in the next 6 months. Half of those staff people will be dealing with practitioner-facing roles, lining up physicians to use the service and training them. We have a pretty extensive waiting list of doctors. We haven't had a lot of work to grow our waiting list. We jumped from listing 1 to 5 percent of dental practitioners in Manhattan with no activity on our part. Started with dentists, then added primary care docs 5 months ago, and added dermatology 1 month ago. We're also building developer base because there are so many interesting expansions. In this market too, really talented developers are really hard to come by . If you know any please send them our way, we've been very selective. Entrepreneurs have told us the first 20 employees are the most important in the company. Since September we've had 1200 people apply at ZocDoc – we're bringing on employee number 10 now. With Trevor (who set up our interview), we had to talk to 100 people before we found him, so we're really trying to get a very quality team.


Q: Why go head to head with a multitude of other doc search and ratings firms? What's different about ZocDoc? Who do you consider to be competitors?

A: (Cyrus) I actually had an issue, one year ago during a January flight from Seattle to NYC, when I landed I ruptured my eardrum. It was a horrible experience. I went to my insurance company website and it just didn't cut it for me. It took me four days to get to a doctor. NYC has highest density of docs in the world, Tel Aviv is number 2. There's an oversupply of doctors in NYC, but the information was just bad on my insurance company website. If you pull up your insurance company website, and pull out 10 doctors names, at least 20 percent of them are going to be bad – maybe even the doc has died and is still on the insurance company roles for years. The other thing ZocDoc supplies is who is really good (according to other patients). We're the category killer for patient booking online. You see your practitioner's availability instantly. You don't have to spend a whole day making calls. The second thing is that we're the only site on the internet I'm aware of that confirms patients are the only ones leaving feedback.


Q: So how does that process work?

A: (Cyrus) The doctor confirms the patient has showed up. Then the patient gets an email inviting them to leave a rating. If a patient doesn't show more than once, they're actually locked out of the system. Practitioners love that habitually bad patients are locked out of ZocDoc. Our no show rates are significantly lower than practitioners own no show rates. This is because we send so many reminders. After booking, patients receive reminders at 1 week, one day, and 1 hour ahead of time. We also verify the individuality of each patient – you must provide a phone number and that phone number is verified.


Q: Ok, so how do you get docs to join? Active recruiting? Do they find you? How do you expand the ZocDoc pool, and do docs get anything from joining other than new patients? NOTE: One doc reports 20% increase in patient flow – do you have staff managing physician relations?

A: (Cyrus) Doctors find us, and sign up on our waiting list. We'll go and say opthamology is next because we had great waiting list. Then we look at the distribution of practitioners – you have to have availability every few blocks – so we don't want one doctor in the Upper East Side. In every neighborhood we need a selection of doctors. We make a concerted effort to fill in the gaps so to speak.


Q: Seems like I got different results when I entered “I'm paying by myself.” Can docs vet prospective patients ability to pay using the service (I see that there's an optional place for me to enter my healthcare coverage information and how I'll be paying) does this automagically weed out physicians who don't accept my form of payment?

A: (Cyrus) From our perspective patients want someone who's in network for them – that has very heavy weighting in how search results show up. They're weighted using an algorhythm so that in-network practitioners show up first, but all docs do show up. Our goal at all times is to operate completely in the patients' best interest. We have had practitioners approach us with requests for search optimization services like Google, but won't do that, because we put patients first in 100 percent of everything we do. If patients don't trust us, we will not be successful.


Q: Has that happened yet? Has a patient come to ZocDoc with an issue about scheduling, or a complaint about a physician, etc.? How did you solve the issue?

A: (Cyrus) Ok, here's a good example. A patient booked an appointment on Saturday. The practitioner got the email about the appointment in his car, and he was stuck in traffic. We love the Saturday appointment, so we were on top of this. The practitioner told us he was going to be late. Our COO Oliver called around and found a dentist who could see them on Saturday.

A: (Oliver) We get love letters from our patients on a regular basis. I practiced for a few years, and I never got that feedback from my patients, so it's quite nice. We had dentists open on Thanksgiving Day. I wouldn't have known who to give a call to on Thanksgiving Day – so we had patients with dental pain on Thanksgiving day, I would never have known.

A: (Cyrus) Here in NYC, GHI is HMO specific insurance – it takes month before primary care doctors can see GHI patients. If they use ZocDoc, we're going to have 10 primary care docs who could see them in a week.


Q: I'm not a doctor, but I have a friend in DC who knows I'm in healthcare, so she's asked me for a recommendation for a specialist. I don't know anyone, but if ZocDoc was there I'd refer her. Any plans to expand into other regions?

A: We hope to be in DC soon. We're letting people submit requests to the waiting list and vote for expansions.


Q: Tell me a little bit about your backgrounds. How did you get into the Health 2.0 sphere?

A: (Cyrus) We've all been entrepreneurs – our entire management team has done startups before. We're involved in health because we do believe we are changing the world. There is a very big altruistic element to what we're doing. Doctors love us and patients love us. It's a real problem that many, many people have. Both of us (CEO Cyrus and COO Oliver) left McKinsey directly. It was very compelling because it was just needed, no one else is doing it.

A: (Oliver) It's been a really great start. Being a doctor myself I know I wanted to do something in the healthcare space. It's about how you can really move the needle – quality is great, but we've gotten to the point in this country where we can only make incremental quality improvements. Coming from Europe myself (Germany), our access is sort of a little bit easier – there's not this sort of scheduling issue, you just walk into a doctor and see them. This is a problem here and we need to make it easier. The experience proves that we are right, scheduling is more of a pain point. It's a very obvious. People hate the way the system works right now because it's inefficient for all parties.

A: (Cyrus) Our entire management team comes from families with doctors in every generation. So we all grew up in the healthcare industry.

A: (Jen) As the daughter of a nurse, you know what I'm going to say next right? You need someone with a nursing background (laughter) to round out the team.


Q: I see ZocDoc is on Facebook – are you using other social networks like MySpace, Plurk, Britekite, Twitter?

A: (Cyrus) Yeah, anyway we can reach people and get them to talk in a viral manner. You can imagine docs who are on FaceBook, right? Well, what if you are able to book an appointment directly via their FaceBook page.? One thing we keep in mind – that 80 percent number (healthcare for the Middle 80)– pare it down to solving 80 percent of the problems. A lot of the healthcare people go after these are things that are on the long tail.

A: (Cyrus) Also your earlier question about partnerships is interesting. We have our feedback system. People don't book doctors appointments often enough for there to be specific social site just for this. But we have waiting lists in other parts of the country – San Francisco, DC, Boston. We had an opthomologist in South Dakota email us. But the ability to do one-off partnerships takes a lot out of the entire team. Going in and doing deals in the short term – it's something we'll consider. We are talking to a lot of players in the Health 2.0 space. That's why we made our API available. At this point it's probably more effective to pound the pavement and do things our own way. It's early, is what I'm trying to say.


Q: Everybody hates this question, but final thoughts about where you think healthcare in the US is going?

A: (Oliver) That's a very broad question - where it's going from the consumer perspective – I think there will be more responsibility that consumers will have to take on as they make more decisions. But right now, there's not enough information out there for patients to make these decisions well, so I think that is certainly one of the areas where more innovation and more products are needed. From a physician perspective, we're at interesting crossroads right now. I think many are waiting to see what the next Administration will do. And with respect to universal healthcare – it has a lot of potential. And I really hope it will get a good stand. This may be a politically contentious view, but we need to be getting to the point where people are covered earlier in the disease process, where we don't have to catch them in latter stages of 3 diseases in the ER


Q: Thanks very much gentlemen for your time. As an e-patient and consumer-centric healthcare advocate I'm encouraged to see a service like this. Hope to see you at Health 2.0!

2 comments:

JaaJoe said...

Did you see the Bunk study stating 2/3 of doctors in America want National Health Care. The doctors who did this study also conducted one in 2002 and found that the majority of doctors did not want national health care, the problem with this is that the 2 question surveys drastically differ in there 2nd question. I found this article, 60% of Physicians Surveyed Oppose Switching to a National Health Care Plan, It's worth a read.

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