I’ve heard people joke that Google has only a few successful businesses, mostly advertising.But it may have found another hit: Insurance other Companies object to potentially expensive medical care for their workers.
Information Revenue at its healthcare company Verily more than doubled to become the largest Alphabet subsidiary after Google, according to reports — and its health insurance business, Granular, was the biggest contributor to that growth. Granular’s revenue “increased nearly sixfold to $151 million from the first nine months of last year, compared to $27 million a year ago,” wrote information.
But Granular doesn’t sell health insurance to employees.It sells “stop loss” insurance to employer They worry that their own workers’ medical claims could hurt them.
You see, not every company helps their employees pay traditional insurance premiums and your doctor bills your care, like UnitedHealthcare or Anthem or Aetna (although those companies are probably middlemen anyway). Some believe it’s more cost-effective to “self-fund” and pay for the employee’s own medical expenses.
Regardless, Google/Alphabet/Verily’s Granular Insurance is one of many stop-loss insurers that promise to pay claims over a certain dollar threshold in exchange for their own regular premiums. Yes, that means the companies that sign up are paying for the insurance, not the insurance – they’re betting that most workers won’t have enough claims to justify traditional insurance premiums, but they’re also betting some workers There may be huge insurance premiums.
How is Granular different from other stop loss providers? It’s not so clear. The company advertises that “Granular uses a smart framework to better protect self-financed employers from labor cost fluctuations with diverse health-related needs,” but I think that just means it’s cheaper. I dug up some local government meeting material from the San Joaquin Valley Insurance Authority in Fresno County, CA, and they mostly seem to be considering Granular as a replacement for their existing stop provider because of the competitive pricing.
But maybe it’s more competitive because Google thinks its data can make more accurate bets. The San Joaquin Valley Insurance Authority noted that Granular will offer its services alongside “Point6,” which appears to be the company that it says “brings actionable integrated solutions focused on the 0.6 percent workforce that Worker groups are driving 35% of employer healthcare spending.”
Either way, it’s not exactly the image I usually associate with Google’s wellness efforts. Originally, Verily was most closely associated with the long-shelved dream of smart contact lenses.