Here's my take on the rise of new mental health companies (Ginger, Lyra, Spring, Modern, etc.). These companies have raised a ton of money and are getting traction in a large market.
The question is: what now? who wins?
The question is: what now? who wins?
Mental Health is a hot button issue right now. That's driving massive adoption from employers looking to have an answer. Here's the problem: mental health is *expensive.* The least it can cost to impact someone's mental health is $600 (6 sessions * $100/session).
A commercial insurance plan costs $300-1000/mo (including employee contributions). Material mental health coverage can add 20% to the healthcare bill.
There's another catch: more usage of the benefit means more cost, less usage means you're paying for an unused benefit.
There's another catch: more usage of the benefit means more cost, less usage means you're paying for an unused benefit.
When employers look at their spend in 3 years (after 1st contracts expire) and there's less press coverage on MH, will they keep it?
Digital Health is full of co's that become checkbox items, massive adoption, then fizzle out (see: Castlight). Mental Health has a similar risk.
Digital Health is full of co's that become checkbox items, massive adoption, then fizzle out (see: Castlight). Mental Health has a similar risk.
Mental Health is fundamentally a supply problem. Everyone wants a therapist, but it's *really expensive.* The only solutions, and the long term winners in this category, are going to be the ones with innovative models for activating new labor forces and AI counseling.
This is why I'm bullish on Ginger over these other companies (disclosure: my dad is an investor, but I have no inside Info). Ginger's model of using health coaches helps activate a new workforce and make high quality mental healthcare affordable. Ginger is also emphasizing AI.
tl;dr of this thread: cost matters a ton, therapists are super expensive. health coaches + AI will win to increase the labor force and make mental healthcare more affordable. watch out for ginger.
PS - this is a great example of my tweet from the other day. it *sounds* great to give everyone mental health benefits, but it's really expensive and cost realities will come into play. Winners will break that cycle and offer great care at lower cost.
https://twitter.com/nealkhosla/status/1369377485071212558
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