NerdWallet is best-known for its credit card comparison and personal finance website. But this week, the company announced it is moving in a somewhat surprising new direction: health care.
To lead the push, the San Francisco startup hired former venture capitalist Christina LaMontagne, who will develop a variety of health transparency products and market them to consumers.
What’s interesting about NerdWallet’s entrance into the space is that it will help patients, whether they are employed or not, understand how health care reform will affect them.
“Amidst this confusing period of change, NerdWallet Health is the patient’s companion to finding higher value health care,” said LaMontagne, who formerly worked as a principal at Physic Ventures.
NerdWallet has already launched its first product, a hospital comparison tool. As recent press reports show, costs vary wildly between hospitals and health clinics. Patients know exactly how much they will pay for a carton of milk, but when it comes to surgical procedures, they are in the dark.
NerdWallet is attempting to rectify this problem — its new tool pulls data, released by the Centers for Medicare and Medicaid Services. According to NerdWallet, patients can use the tool to compare health cost and quality care for the top 170 procedures in the U.S. in over 3000 hospitals.
NerdWallet is entering a crowded space, and will likely compete with Castlight Health, Maxwell Health, and Change Healthcare, among others. With the Affordable Care Act coming into effect in 2014, investors are funding health IT startups that provide education and information to employers and individuals, so they can take advantage of the new regulations.
The company has already released some fascinating data, which may prove to be useful for patients, health insurers, and those interested in preventive health. Montagne found that hip and knee replacements are the most common surgical procedure in America, which set Medicare back $6 billion last year. The survey also revealed that people in Arkansas, Hawaii and Wyoming do not have access to high-quality knee and hip hospitals.
It’s not clear whether NerdWallet will make money off these health products. The company isn’t pulling in revenues for its products in the education and travel space, a spokesperson told me. But the founders are experimenting with taking a commission on a small percentage of the products and services they recommend.
With this move into health care, NerdWallet may push past its chief competitor Mint.com. The company was founded in 2009 by a group of former financiers to help millennials manage their finances.