More than 30 years ago, when Hal F. Rosenbluth was the young president of his family’s corporate travel business, he embraced technology in a bid to help companies get a grip on travel expenses, widely viewed as unmanageable at the time.
Now, Rosenbluth, 64, has a new company, New Ocean Health Solutions, that has set its sights on another expense he called unmanageable: employee health care.
That is a monster goal, but it is not where New Ocean is starting.
New Ocean made its debut this week with an entry into the crowded market of corporate health and wellness programs, which companies use to help employees lead healthier lifestyles, lose weight, and manage chronic conditions.
“It’s starting to create something which is manageable. It’s beginning to put out the tools,” Rosenbluth said.
The company’s secret sauce is behavioral science based on research by the University of Pennsylvania, said Rosenbluth, cofounder of Conshohocken-based Take Care Health Clinics Inc., which was sold to Walgreens for $250 million in 2008.
While working as president of Walgreens’ health and wellness division, Rosenbluth learned what does not work by looking at possible acquisition targets for Walgreens.
“We walked away from all of them because you would have limited engagement, and then people would drop off,” Rosenbluth, who served in that role until 2012, said in an interview last week. “They didn’t use behavioral economics to create the pathway for people to be engaged.”
In New Ocean’s offices, software developers sit under flat screens displaying their work. “Someone might see a shortcut,” said Rosenbluth, wearing the cowboy boots that hint at his attachment to a 3,000-acre North Dakota ranch.
The grounding in behavioral science was a key selling point for New Ocean’s first customer, Independence Blue Cross, which also invested $2.4 million in New Ocean two years ago when it was called CareCam Health Systems and had a narrower focus on helping people with chronic conditions.
The key is being able to effectively motivate individuals, said Brian Lobley, president of commercial and consumer markets at Independence, which is currently deploying the New Ocean health and wellness program to its employees, with plans to make it available more widely later this year.
“You’re going to motivate a mother of four in the suburbs a lot differently than an aging senior who wants to stay at home in the city. We love that aspect of getting a lot more personalized,” said Lobley. He also said it was important that New Ocean was building its program from the ground up for mobile devices.
New Ocean’s program starts with what it calls a “private-health assessment,” as opposed to a health-risk assessment, a term that scares people off, Rosenbluth said.
New Ocean’s algorithms will generate a very different program for a senior with diabetes and congestive heart failure than for a millennial who goes to the gym five days a week.
“Oh, wow, you’re actually talking about me,” as opposed to a generic insured member carrying an Independence Blue Cross card, Lobley said, describing the impression he hopes New Ocean’s system makes on users.
New Ocean shared a series of smartphone screen shots that show guides for desired activities, such as eating well, getting exercise, and sleeping enough, with mechanisms to report those activities and get rewards that are displayed as dollars and carrots. A carrot could be a day off or a chance to wear jeans.
The behavioral science underlying New Ocean has shown that humans have a bias toward the present, an aversion to loss and regret, and a tendency to overweight probabilities, said Karen Horgan, president of Val Health, whose cofounders include David Asch and Kevin Volpp at Penn.
New Ocean, which employs 40 in Conshohocken and pays 80 percent of health-care costs, is using its own program in a way that relies on loss aversion to get results.
“If they go with the program, they will continue to have the 80-20 split. Plus, they’ll get these monetary awards, which could save them $100 a month on their medical costs,” Rosenbluth said of his employees.
“If they don’t do this. Then the 80 percent will be reduced to 75 percent. That aligns the needs of the individual and the company,” he said.