Doctor-Sourcing Service Grand Rounds Raises $40 Million
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Grand Rounds has raised $40 million in a Series B funding round led by Greylock Partners.
The San Francisco startup, which provides medical second opinions online, plans to use the capital for research and development, sales and marketing, and other purposes.
Grand Rounds now has about 35 business customers, including Jamba Juice and Hightail, covering more than one million people. The three-year-old company previously raised $11 million from Venrock and Harrison Metal, both of which joined the latest round.
The company’s Expert Opinion service, available online and though apps, allows patients to run their medical issues past top specialists using an algorithm that matches needs to expertise. The doctors can review the person’s medical history, diagnoses and treatment plans and, when appropriate, propose alternative paths.
The experts recommend major changes in diagnoses or treatments about 65 percent of the time, Chief Executive Owen Tripp said in an earlier interview.
Grand Rounds pitches the service as a recruitment tool and money-saver, particularly for self-insured businesses that cover medical costs directly.
The United States spends far more than other nations on healthcare without the benefit of better outcomes, and it’s often one of the highest costs for businesses. Starbucks has famously said it spends more on healthcare than coffee beans.
Tripp, who previously co-founded Reputation.com, doesn’t suggest Grand Rounds can single-handedly solve the problem. But he believes it does address some major cost drivers.
Many diagnoses are simply wrong, leading to unnecessary procedures or more expensive ones when the real issue is left untreated. The local doctor referred by a co-worker or friend may simply not be up to date in the area in question — or might not be a particularly good physician to start with.
Other times, Tripp believes misaligned incentives come into play. Doctors can tend toward treatments that pay the most, not the ones that will necessarily be most effective in a particular situation, he said.
Grand Rounds tries to avoid those issues by selecting the doctors in its system based on training, publishing history and performance. In addition, experts get paid the same rate whatever their conclusions. They’re rated within the system based on outcomes and the judgement of their peers.
The company has recently launched two new products: Office Visits, which points patients to local specialists they can visit in person; and STAT, which provides experts to review cases quickly during medical emergencies.
“Grand Rounds is committed to closing the gap between state-of-the-art care that saves lives, costs and productivity, and the general standard of care that can be grossly outdated, overly invasive or otherwise ineffective,” Tripp said in a statement. “This financing ensures we are well capitalized to share Grand Rounds with millions of more patients.”