… and other reasons why HotDoc may not be in your best interest.
HotDoc released another fee recently – a $2.45 platform fee charged on payments processed on their platform – no doubt to get ahead of RBA surcharging, but there’s certainly some buffer there for profit.
Ben Hurst also recently stepped back from the CEO role, off the back of private equity group Potentia Capital picking up a majority stake in the platform earlier this year.
Given I love an analogy here’s the relevance to the meme. When the Titanic started sinking there were a number of passengers who refused to leave. The ship was warm, well lit, huge and many were convinced it was unsinkable.
Despite evidence mounting that staying onboard wasn’t actually in their best interests they remained, actively fighting off people trying to help them into lifeboats.
Clinics currently pay HotDoc a large fee to manage their bookings. HotDoc claims they have one in three Australians using the platform to book GP appointments and they have 25,000 clinicians listed.
Practices lean heavily on the portal, using it as their digital front door for bookings and often having this as the sole non-verbal gateway to accessing care.
As soon as they get around to launching an AI receptionist it will likely be the sole means of booking an appointment outside of face-to-face. Virtual care is often controlled by HotDoc as well – in-built phone and video functionality leaves a lot of the consumer digital experience entirely in the HotDoc app.
So why is this a problem? It’s a good platform. Patients have a good experience. Clinicians have a stable well integrated platform that delivers what it promises. The ship is warm, its well lit and everyone is happy.
But I would argue there are issues here.
The first is that your evolution is entirely dictated by HotDoc. The experience is satisfactory but limited. You’re asked what doctor you want to see, then shown a bunch of times.
Consumer expectations are changing and increasing productisation of medicine will mean the people come seeking a solution to a self-identified problem – no longer just to “see a GP”. Think GLP1s, ADHD and menopause care.
Online-only clinics appeal to this through product-led services, and are people are flocking there).
Your clinic will need to start asking consumers “what can I help you with” rather than simply “when do you want to see Dr Pradeep”.
HotDoc may or may not end up being that service but the sheer volume of clinics using them leaves you as an end responder rather than a leader.
The second issue has already come up before.
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HotDoc has a separate group of clinicians servicing patients through the app, in direct competition to existing clinics. Log in as a new user and you’ll be offered the “on demand” option quickly. Fail to turn it off as a clinic user and your patients will be offered competing services on the same page you pay HotDoc to manage.
Private equity doesn’t take on a company like this because they think existing margins are worth the price – they come onboard to achieve growth.
GP practices are subsiding the existing platform but my personal opinion is that we will see more “opportunities” to further extract funds directly from patients as the next step.
A platform fee is also a fascinating term to use – super similar to the language used by companies like Uber Eats, which has been exceptional at monetising both sides of the marketplace, leveraging fees on both restaurants and consumers.
The difference here is HotDoc’s platform fee is only on payments through the app and they’re missing a lot cashflow between consumers and clinics.
But (tin-foil hat moment here) there is a great opportunity coming up where surcharging will be banned (thanks RBA) and my mind certainly drifts to a future where HotDoc offers to process all your fees booked through the app. While you can’t surcharge on your tyro machine (and have to eat the 1%) they have an architecture to still shift that cost on to patients.
So, once you have aggregated a third of the Australian population onto a single healthcare marketplace, there are an enormous number of ways to monetise the space between the consumer and the clinician.
And if your clinic has spent the last decade making that marketplace its only meaningful digital front door, your negotiating position when those new monetisation ideas arrive is not particularly strong.
And finally we make it all the way back to the Titanic.
The danger here is not that HotDoc is a bad product or that $2.45 will change the entire relationship. The ship remains warm, the iceberg is hit but the water is only filling the crew cabins – no passenger socks are wet yet.
But a digital front door is a key strategic asset for general practice. The longer you outsource that to a commercial partner – with a lot of levers they seem happy to pull to monetise you and your customers – the closer you are to leave getting off the ship too late.
Dr Max Mollenkopf is a GP and practice owner in Newcastle, NSW.
