A Series of Forbes Insights Profiles of Thought Leaders Changing the Business Landscape: Daniel Cane, Founder and CEO,
“I was at a doctor’s office and marveled at the lack of technology. I felt it was a moral imperative to get involved, because for some reason healthcare was left behind in the technology revolution,” says Daniel Cane founder and CEO of Modernizing Medicine, which is working to transform how healthcare information is created, consumed and utilized in order to increase efficiency and improve outcomes. In fact, the company was listed on Forbes’ annual ranking of America’s Most Promising Companies this year.
Modernizing Medicine’s flagship product, the Electronic Medical Assistant , is a cloud-based, specialty-specific electronic medical records (EMR) system with a massive library of built-in medical content, designed to save physicians time. The software is available as a native iPad application or from any web-enabled Mac or PC. The idea behind EMA is that it adapts to each provider’s unique style of practice and is designed to interface with hundreds of different practice management systems. Today, Modernizing Medicine provides specialty-specific offerings for the dermatology, ophthalmology, orthopedics, otolaryngology and plastic and cosmetic surgery markets, and to more than 1,300 physician practices across the country.
Cane has already shown an ability to disrupt and revolutionize another hidebound and slow-to-change sector of the economy—education. He was the co-founder of Blackboard Inc, a technology solutions company dedicated to helping improve every aspect of the education experience. “I was an undergraduate at Cornell and education was all that I knew, which is where the idea for Blackboard came from,” says Cane. He was instrumental in growing the company through five private rounds of financing, raising over $100M in venture capital and in 2004 helped take the company public on the NASDAQ (BBBB). The company was later acquired in 2011 and taken private by Providence Equity Partners for $1.6 billion.
The genesis for Modernizing Medicine came about after leaving Blackboard and moving to Florida. “My wife made me get a check-up. I went to a young dermatologist who told me nothing in the world was faster than paper when it came to managing his practice. Here was a physician who grew up with technology but thought the most efficient tool he had available to him was a sheet of paper. That dermatologist, Dr. Michael Sherling, who also had an interest in finding a better solution, became my co-founder, and the idea came to us—there’s got to be a better way!” The two then started to plan how to attack the problem and build a business around a solution that made doctors more efficient.
“The act of making a doctor more efficient is the half of it—getting the right technology that captures the collective wisdom of Doctors over time, is the other, perhaps more important half of the story,” says Cane. The company can pool and aggregate data and feed that data back to the doctors to help them gain information and insight into how to best treat a patient. “We had to invent our own language for healthcare. It was like when the country decided to go to the moon, the technology needed to create the tools to make the rockets to get us to the moon didn’t even exist, so they had to be invented,” continues Cane.
“My background is economics—the incentives in the healthcare business are perverse,” said Cane. He contends that we now live in a healthcare system whereby doctors are financially incentivized to provide services rather than focus on outcomes. “Everyone is doing the best they can in a system that doesn’t work. Doctors, pharmaceutical companies and insurance payers could all work together, better with our system,” continues Cane.
“You would think that with all the data we have, someone would have figured out how to shift incentives towards better patient care. There’s a fundamental problem—the data is unstructured. The medium is so complex, you need something akin to IBM’s Watson for each specialty, says Cane. A more effective approach is to have the provider input the data in a structured way. With EMA, we can do that, and we can benchmark a provider’s data in real-time against that of their peers. This helps us shift to a pay-for-performance model. Here we have comparative effectiveness data in the real world with millions of patients,” continues Cane. “And if you build an intelligent system that adapts to doctors’ preferences—Doctor X likes this, Doctor Y like this—and make it smart like Netflix, a company that uses data to intuitively predict what you want to view—you have a solution that enables doctors to work faster.”
Modernizing Medicine came up with a system that doctors developed. Because EMA has been programmed by physicians with specialty knowledge, it helps in selling it to other doctors. “Our doctors also participate in the selling process, speaking to other doctors about the product and conducting demonstrations of the product. The best person to sell to a doctor is another doctor,” says Cane. His ‘aha moment’ that he and Dr. Sherling could actually make a go of the company came after they convinced a handful of practices to use their system. Then in conversations with their Beta clients who were excited about EMA, Doctors asked if they could invest in the business. “This provided the bridge round to our series A investment. Each wanted to put in $50,000-$100,000 into the business. We wound up raising $3 million within the month. This created 30 evangelists within the community who helped sell the concept through use of the product and conversations with their peers. The number one reason people hear about us is word of mouth from other doctors,” continues Cane.
“We launched in dermatology—no two aspects of medicine are the same, so we pick a single specialty at a time,” says Cane. The company hires doctors out of the specialty and teaches them how to program. It’s easier to teach a doctor how to program then to teach medicine to a programmer. We now have over 2,500 dermatology providers using the system. After dermatology, we moved to ophthalmology. It takes a year to build a product that is designed to the exact requirements of each specialty. We’re so focused on each specialty that to ophthalmologists, we’re an ophthalmology company, but to dermatologists, we’re a dermatology company,” Cane continues.
The company now has 18% of the Dermatology specialty market already. “We invest millions of dollars into building and customizing the system for each specialty. It’s a slow, deliberate march” is how Cane describes the process of building the Modernizing Medicine business. “EMA just surpassed its 10 millionth patient encounter. We can share the de-identified, aggregated and analyzed results with our providers and academic researchers. Imagine an orphaned disease like pemphigus foliaceus. A doctor might see one case in their career. Our clients will see treatment data from hundreds of cases and will have the collective wisdom at the point of care to make better decisions. It’s a constant learning system,” says Cane.
“We’re not the first to enter the market, but what we do is bring a vision that is unique to the sector. We could have called our company anything—but to modernize medicine you need the vision to use data about what’s working and what’s not—to help doctors make better decisions about how to make their patients well. We’re just three years old. Our compound annual growth rate (CAGR) from 2011 to 2013 is 200%, and we just closed our series C funding with $14 million from Summit Partners," says Cane
"We have an excellent playbook. Imagine Google maps for the body, a 3-D anatomical atlas, touch-based, visual system—it all becomes possible with structured data. The more users, the more wisdom is put back into the system. It really sells itself,” continues Cane.
“My real talent is surrounding myself with incredibly talented people,” Cane concludes. Along the way he just might revolutionize the healthcare business one doctor’s practice at a time.
Bruce H. Rogers is the co-author of the recently published book Profitable Brilliance: How Professional Service Firms Become Thought Leaders now available on Amazon http://amzn.to/OETmMz
