Optum's Faiz Ahmad explains the rise of Direct-to-Consumer health care -- and its impact on the industry -- to host Ira Apfel.
No area of the health care industry is more competitive than the Direct-to-Consumer market. Startups have emerged, promising to sell generic drugs inexpensively online. Legacy providers are offering telehealth and prescription drugs as well. And now there's big retailers, including Amazon, getting in on the act as well. Here to discuss the trend with host Ira Apfel is Faiz Ahmad, CEO of Optum Direct-to-Consumer.
SPEAKERS
Ira Apfel, Faiz Ahmad
Ira Apfel
Hello, and welcome to UnitedHealth Group’s Weekly Dose Podcast, where we'll get you up to speed on the latest trends shaping the future of healthcare. And don't forget, the podcast is now available on Apple Podcasts and Spotify. So be sure to subscribe so you never miss an episode. Now on to the show, no area of the healthcare industry is more competitive than the direct to consumer market. Startups have emerged, promising to sell generic drugs for cheap online, right to internet servers. There are also big online companies offering telehealth and prescription drugs. And there's also big retailers, you know who I'm talking about? They're getting it on the act as well. So what's driving this gold rush mentality into the online direct to consumer sector? And how can legacy pharmacies and pharmacy benefit managers keep pace? Here to discuss the state of the direct consumer retail healthcare is Faiz Ahmad. He's the CEO Optum Direct to Consumer. Faiz, welcome to the podcast.
Faiz Ahmad
Thank you. It's great to be with you.
Ira Apfel
So let's start off, you have a lot of experience with digital commerce. And you have previously worked at Apple for a while online store, for example. So I'm wondering if you could give some listeners some perspective, on the changes in growth in this healthcare direct to consumer space? How much growth is there? What's happening? What's changed?
Faiz Ahmad
Thank you, great question, he has had the chance to work in the consumer electronics world. And then before that, in the airline space, it's so good to be in the healthcare space. You know, when passion meets purpose, you know, you can do some of the most amazing work of your life. Excited to be here, excited to be talking to you about this topic, as we think about it, that one of the biggest opportunities that we see is the pandemic changed our lives. And you know, in so many different ways. And more and more of us are using digital tools, more and more of us are actually having appointments, whether it's health appointments, or food delivered at our houses to be done through digitally. So fundamentally, the world is has evolved to where things which are not common has started to become common now and more and more so prevalent in our day to day lives. And healthcare is not an exception. And so we see tremendous growth there. Secondly, you know, as you think about it, you know, there's so many digital solutions in the marketplace, and there's a huge opportunity for us as an Optum and UnitedHealth Group, to bring this together in a meaningful way for all consumers and in some ways, all people 330 million in this country. So tremendous growth, tremendous opportunity and, and a field which is actually going to continue to evolve in the years to come.
Ira Apfel
And I take it that with the tremendous, tremendous growth in the field, you're also seeing some more competition, is that correct?
Faiz Ahmad
Yes, absolutely. It's as I as I look at this as to a lot of good career, great companies, for that matter are moving into the healthcare space. And it's it is healthy, and it is great to see that happen. Fundamentally, I look at United Health Group as has been a unique, unique position to be the leader in that in this space. We have we have the best clinical know how we have the right talent, and we know healthcare, because healthcare, as you all know, and as we all have got to use healthcare, believe it's something that you know, needs a special attention and special care and a special, you know, connection with people. And there is no brand which is uniquely position, then Optum and UnitedHealth Group to do legal space.
Ira Apfel
So he talked about this a little bit earlier, but I wanted to see if you can dive in a little deeper. How much of an impact to the pandemic have on consumer behavior, what were they doing before? What are you doing now?
Faiz Ahmad
Great question. I think as I look at, you know, in everyone's life, there's a personal shopper in my home, it's my wife and I look at the way her life has changed in the pandemic and then how much time she spent with my kids taking to the doctor's appointment or going to the grocery store, or actually even spending time in the mall. And what has happened as we see the doctor visits have turned into virtual visits, most often than not, we have seen our groceries been delivered to our doorsteps rather than actually renting in the grocery store and malls becoming more of an experience centers rather than just a transaction place. So what has fundamentally altered is our way of life and I think it's not going to go back to exactly what we what we had previously. OB were used to previously for that matter. So, my view, the pandemic has, has had, you know, as there are so many challenges around the world, but in some ways it has actually allowed us to be the disruptors in our own industries and healthcare is going to be one of the places where we are going to see a lot of activity when it comes to self-care and, and home being the purveyor a lot of us are going to spend time managing your health through.
Ira Apfel
It's interesting the way you put it, you know, this has enabled us to disrupt healthcare. So you're, you're kind of like, you're in healthcare, obviously. But you're kind of disrupting it from within you're not some kind of outside company or some brand new technology is kind of revolutionizing from the inside.
Faiz Ahmad
Yes, you know, as you look at it, there's a lot of, you know, and you guys, and we all know, there's a lot of companies working in healthcare, and a lot of digital point solutions, but none of them are connected. Secondly, if you look at Optum and UnitedHealth Group broadly, we have some of the best products and services that we can offer to all people, not just our members. And as more and more people seek good integrated consumer platforms in their lives. I think we are uniquely positioned to bring that in front for all consumers and all people in the US and hopefully in the future globally.
Ira Apfel
So what has been groups and options response to this? What? What's changed in the Optum store?
Faiz Ahmad
Yeah, so another very good question. You know, when we started last year, instead, think about the band as the pandemic came along. As we talked earlier, one of the things that we wanted to think about is like, how could we bring an integrated solution to the market? How could we be that connected point and a curated health experience, both for the health needs and care needs for all people. And that's when Optum store was created before we built it out in, in, you know, late 2020. And, and through the through the years off to the to the six months, or I should say, nine months of hard labor, and work, we are at the stage where we offer multiple product lines, and as they call them aisles on the platform, which consumers can use and all consumers can use.
Ira Apfel
And so you've chosen for that kind of almost kind of like as in your terminology aisles. It's almost like you're replicating a typical in store experience with online, is that the best way to look at it?
Faiz Ahmad
Yeah, that's the that's the best way to look at, Ira. And I think, you know, we have four aisles right now. So if I may just give you a quick, short, brief review of the view of the aisles. The first aisle is what we call the order counter products we all need in our day to day health needs. And we have curated a list of products for consumers to choose. The second aisle is our pharmacy aisle, which is our cash pharmacy buzz aisle, which actually allows consumers to pick 900 Plus generic drugs and a consistent pricing throughout the experience and pricing available before you actually purchase. The third aisle as we have brought in telehealth and care experiences in bringing the combination of care and pharmacy into one experience. And the fourth aisle is the IOP is starting to work is around subscriptions. And the first subscription will launch is a mental health subscription for people who are suffering from anxiety and depression and giving them the right therapy and medication options.
Ira Apfel
I'm wondering how are you reaching people who are not, you know, members of UnitedHealthcare or Optum. Just your average consumer who doesn't? Who may never have heard of you before?
Faiz Ahmad
Yes, another great question. As with any consumer business, you know, it takes time to get the word out and the right. Right. Right visibility in the marketing. One of the things that has been interesting to note is with the pandemic, there was a there has been a huge need for COVID testing. And that COVID testing of need in the marketplace allowed us to play a significant role, significant role across our partner groups. So whether it's our partnerships with our airlines, colleagues, or the partnership with our cruise liners, our partnership with even employers so we have become a destination where consumers are able to get their car Over test kits. And as that experiences have evolved, those experiences have translated into consumers getting to know our other eyes as I talked about these four other aisles. And it's been fascinating to see the growth in the last six months about with started with the COVID test kits and moving into other eyes.
Ira Apfel
Where's Optum? Store headed? Where do you see going the next six months to a year?
Faiz Ahmad
Yeah, without disclosing anything, you know, confident to tell you is, is in the short run, we want to set the standard for health and care services come together in an experience that we all as consumers expect from all industries and all our interactions. So that's where our short term goal is create the best and the end and easy to use experiences. As we as we continue to build on our experience, we will see more and more aisles get created and built out by the team. And also you would see as more and more of us more and more of the experiences going towards being connected and more and more Optum products show up on the on the store.
Ira Apfel
So improve the user experience first and foremost before adding a whole bunch of new products or services. Is that correct?
Faiz Ahmad
Yeah, I would say less about improved. But I would say more about actually making sure that our delightful experiences get to more people and then the car in the mark and as in the market. And then as we build through it, we will find out what the right amount of research and connections and clinical reviews. What are the products and services, our consumers desire.
Ira Apfel
Last question for you. Where do you think the direct consumer space is headed in the next six months to a year or two years? Just where's the general industry going? You think?
Faiz Ahmad
I think as we talked a little bit earlier, there is there's a lot of great momentum in this space. There is a lot of great number of companies working in this space. What I think is going to be unique is going to be brands which are able to create simple connected experience, which are available to all people and which are available in an easy to use manner. Not just an unexperienced perspective, but on a price transparency perspective, are going to start to take the lead and we hope to be one of those brands which actually steps in to the space in a in a unique differentiated manner.
Ira Apfel
Awesome. Mr. Thanks so much for being on the podcast today.
Faiz Ahmad
Thank you. It was great to talk to you. Thank you.
Ira Apfel
That's it for this episode of The United Health Group's Weekly Dose Podcast. And don't forget, please subscribe to the Weekly Dose Podcast on Apple Podcasts or Spotify. Thanks for listening and have a great rest of your week.