About John Roos, Co-Founder & EVP
John Roos joined Aphora Health in September 2022. After retiring from Blue Cross Blue Shield North Carolina at the end of 2020, he formed Thirty-Four Consulting, LLC, to offer his industry expertise to health plans, employers, providers, and health technology companies. At Blue Cross, Roos was the Senior Vice President and Chief Growth Officer. In his 22-year career at Blue Cross, the company’s revenue grew from $1.5 billion to $9.5 billion while adding 1 million members.
Other accomplishments under Roos’s leadership include the company’s launch of the Affordable Care Act (ACA) products to individual customers and significant investments to advance diversity, equity, and inclusion in communities across North Carolina. Investments included nursing and first responders, food security, domestic violence prevention, and safe, healthy housing.
About Aphora Health
Aphora Health is a global healthcare services company that aims to improve health equity and lower costs by bringing global healthcare to U.S. markets. The company provides global healthcare access directly to consumers who pay out-of-pocket for healthcare, as well as self-insured employers and their health plan members through its network of accredited healthcare providers, with a clinically focused, high-touch customer service model.
Aphora Health’s offerings target high-cost elective surgeries, expensive specialty medications, cosmetic surgery and dental, and other procedures typically not covered by health plans, such as in vitro fertilization, at significantly lower costs. To learn more, visit www.aphorahealth.com.
Medical Travel & Digital Health News (MTDHN): Tell us a little about yourself and how you got started with Aphora Health.
John Roos (JR): I originally grew up in New York and my father was an IBM-er. When IBM moved tens of thousands to North Carolina in the seventies, we relocated to Cary, NC.
I attended local schools and colleges and upon graduating, took a few sales jobs. My first career opportunity was with a startup and here I am at the end of my career with another startup – with a lot in between.
My first startup was an HMO owned by doctors in the Raleigh Durham, NC area called Central Carolina Physician’s Health Plan. That was my introduction nearly 38 years ago into the business of health insurance. The Plan grew and was eventually acquired by New Hampshire-based Healthsource, where Norm Payson was the CEO.
We had a good run with Healthsource. We grew the business and even acquired a large, traditional health insurance company from Provident Life in Chattanooga, TN. A few years later we sold to Cigna, where I stayed for about two years. My boss at Healthsource and Cigna became CEO of Blue Cross of North Carolina where we continued our work together. I was responsible for sales, marketing and communications, basically anything that rang the cash register.
I retired in 2020 as COVID-19 was taking hold and had a nice 18-month respite focused on grandkids and golf. That is when I received a call from Jim Song, founder of Aphora Health who had an idea and wanted to discuss it over breakfast.
Jim has a global background. He was born in South Korea, moved to Chicago with his family when he was seven (did not read or speak English), and went to the University of Arizona and graduated with an Electrical Engineering (EE) degree. Growing up in Chicago, he said he didn’t have health insurance.
He pursued a career in IT which took him all over the world before he came to work at Blue Cross NC, which is where we met. We worked together for about five years, during which time he earned an MBA from Duke University.
Back to two years ago over breakfast, I was curious and listened to his idea: bring international healthcare to U.S. employer markets at great savings and high quality. The more we talked about it, the more I liked it and got others involved. We created Aphora Health and have been raising money and building the company ever since.
MTDHN: Where do you see a medical travel opportunity for employers?
JR: We think there’s a virtual green field in the self-insured employer space. While medical tourism is nothing new in the consumer self-pay market for things like cosmetic surgery, the employer market has had very little penetration.
In fact, market interest in our model is accelerating, evidenced by this recent announcement:
Aphora Health Raises $2.1 Million in Seed Round to Accelerate Growth
CARY, NC – April 16, 2024 – Aphora Health, a global healthcare services company, announces the closing of its seed funding round raising $2.1 million over the past year. The funding will enable Aphora Health to continue to add new products and services and advance its growth into the market as a leading destination healthcare company.
“Since launching in 2023, we have seen significant interest in our company – not only from consumers and employers but from investors as well,” said Aphora Health’s Co-Founder and EVP John Roos. “Investors understand the incredible opportunity international healthcare affords. In 2024, more than $77 billion will flow from the U.S. and Canada to international countries for healthcare. We are in a position to gain a significant share of this market with our unique business model.”
Individual private investors funded the investment seed round with 90% of the proceeds coming from North Carolina investors. Proceeds from the funds will support the continued advancement of Aphora Health’s business and upcoming launch into the employer-self-funded market.
“It’s great to see that investors have recognized how our absolute commitment to quality when curating the world’s best healthcare will bring growth to the company and their investment,” said Jim Song, founder and CEO.
To fund continued growth and expansion, Aphora Health anticipates seeking Series A Funding later in 2024. To learn more about Aphora Health, visit www.aphorahealth.com.
MTDHN: In addition to Asia, such as Bumrungrad International, what other hospitals or health systems do you work with?
JR: Currently, our network also includes CIMA Hospitalin Costa Rica and Goodness Dental in Costa Rica.
We are close to finalizing a contract in the Cayman Islands, Anadolu Hospital in Turkey, as well as two hospitals in Malaysia.
MTDHN: Is your business model B2B or direct-to-consumer?
JR: Actually, both. We have two lines of business:
Direct-to-consumer or self-pay, which is mainly for elective cosmetic surgeries, cosmetic dental and reproductive services such as IVF. We launched our beta offering in November 2023 with a relatively limited number of options. It was a good way to get up and running. In April we officially launched DTC with the addition of Goodness Dental in Costa Rica.
The employer market will be launched in the coming months. There will be three offerings for employers: global surgery, specialty meds and a voluntary product. We see a huge opportunity to save self-insured employers significant money on specialty meds. There are other companies doing this, but we do it better.
The voluntary product, called Aphora for You, brings all of the direct-to-consumer programs to the employer market. This will include cosmetic surgery, gender-affirming care, cosmetic dental, in vitro fertilization (IVF) and others. We just signed two IVF fertility clinics in Barbados and the Caymans, both are top-notch providers.
Again, we believe there’s a huge market just for IVF for Americans who are paying way too much for this type of care.
For the voluntary product, the employer pays nothing. We simply ask the employer to introduce Aphora to their employees and allow them to save money on procedures that are not covered under the benefit plan. It gives employers an answer to employee demands to cover these procedures.
MTDHN: Why do you think employers have not fully embraced medical travel to date?
JR: Let’s face it, the biggest challenge in the employer market is adoption.
Even if you we get the employer to offer the option, it’s getting employees to opt-in it that’s the other challenge.
Several factors are working for us. Overall, employers are desperate to save money because the cost of healthcare is out of control and they’re looking for solutions. They have already embraced the idea of Centers of Excellence (CoEs) but need to take the next step to say, “Some of those CoEs are outside your border or outside of the U.S.”
So, the first thing is getting employers to offer the option – we believe there’s a compelling cost savings argument they will find very attractive. We recognize they are concerned about quality and whether their liability exposure is increased as an employer by offering this international option. They want quality assurance.
MTDHN: How does Aphora Health provide this assurance?
JR: We outline our quality process, starting with Joint Commission International as the foundation, and we conduct site visits to verify that facilities are implementing safety and quality measures. We require ongoing monitoring, so reports come back to us, as outlined in our contracts.
We aim to assist employers in overcoming the hurdles. From an employee standpoint, deductibles and out-of-pocket costs are rising. Millions of Americans have insurance but aren’t able to afford high-cost procedures such as a knee replacement or spinal surgery – you name it.
In my experience, the most impactful testimonials often come from average employees who are not making a lot of money and express their gratitude. Many say that they never thought receiving medical care without financial strain was possible.
This indicates a significant untapped market potential.
MTDHN: What do you think about domestic medical travel in the U.S. and how does it compare to international?
JR: We are in the process of proving the potential cost savings of domestic medical travel vs the savings international travel can generate.
We’ve been in discussions with OrthoCarolina, based in NC, whose CEO, Leo Spector, is actually on our advisory board. Given their expertise in orthopedics, we’re exploring the possibility of partnering with the organization over time as our flagship domestic provider.
While there have been several unsuccessful attempts to develop domestic networks, our market research shows that Surgery Plus has been successful. The company has networks across the U.S. and works with self-insured employers.
But again, I want to make sure the savings are real on the domestic side. I know the international math works due to the cost structure which allows for deductible waiver and coverage for companion travel. Generally, what we’re offering is a range of 30-40% savings compared to U.S. prices.
MTDHN: Do you provide any warranties in case of a less-than-optimal outcome?
JR: We don’t offer a money-back guarantee to employers, aside from the quality standards in our contracts with international providers. Ensuring the patient’s well-being before they leave the country is an important aspect of our overall package.
At the core of our offering is a registered nurse who serves as our care navigator to guide the patient from the initial inquiry through their return home and finally to ensure continuity of care. If there are post-operative difficulties, such as an issue arising 60 days later, we don’t have any contractual obligations to fly them back. Generally, the patient would seek care for that post-op issue locally just as they might if they moved to a different state after their procedure.
MTDHN: Where do you see the greatest expansion in this industry?
JR: Our general strategy to first drive adoption in the initial rollout of the program. We give the employer comprehensive communication materials to share with employees and drive awareness about our new healthcare offering and how it works.
We think the real key lies in the prior authorization stage for our roughly 20 targeted procedures. For example, a third-party administrator flags us to let us know a patient will need a knee replacement. We then reach out to the patient and offer more information, reminding them of the international option they may or may not remember from open enrollment. This is a key piece to drive employee adoption.
Potentially the biggest roadblock to adoption is that employees don’t know what to expect and they can’t wrap their head around going internationally. They have misconceptions about what the hospital settings might look like. Marketing tools such as a video showing our hospitals like CIMA and Health City in the Caymans can help patients visualize the quality of these facilities and highlight the attractiveness of our international healthcare option.
We also recognize the importance of showing data and facts regarding healthcare quality to support our position.
MTDHN: Can you tell us about your pharmaceutical program?
JR: With specialty meds, we obtain data from the employer’s pharmacy claims file to identify medications that cost more than $2,500 a month – drugs that we can help lower the cost of with AphoraRx.
We offer a solution and present a savings proposal. We’ve started this already with a few self-funded employers where we say, “Here are 20 drugs we know we can source internationally at a much better rate, and here is your savings projection.”
MTDHN: So, you don’t work directly with the PBM?
JR: No, we are an overlay to self-insured employers’ PBMs.
We do expect some resistance from the PBM industry and some of them have their own specialty med programs to try to save employers money. Our sweet spot is going to be the smaller end of the self-insured market, ranging from 500 to 5,000 employees, where we think we can make a real move on the self-insured front.
In addition to home delivery of the medications, we’re finalizing a contract with a pharmacy in the Grand Cayman Islands to provide a travel option that will include travel and lodging for the patient and a companion. Some employees may want to go for the weekend and this option lets them travel, receive the necessary medical care, obtain the 90-day supply of medication and return home, repeating this process every 90 days as needed.
We believe specialty medicine is going to be a rapidly growing part of the business while global surgery may take slightly longer to drive adoption. Our business model is built upon the understanding that just 5% of individuals may initially opt for global surgery. We aim to increase this adoption rate over time.
MTDHN: Is there anything else you would like to mention?
JR: We are planning four go-to-market strategies for reaching employers:
The first is engaging with brokers and consultants, especially in the 500 to 5,000-employee market, leveraging my experience and networking within this system. We’ve already had a meeting with a major brokerage firm, and they are anxious to see what we’ve got and roll our products out through their business channels.
The second way is entering into contracts with third-party administrators (TPAs) who we recognize as key partners. By securing contracts with TPAs, we can gain access to more customers through their extensive client base.
Thirdly, developing a referral agent program where referral partners can leverage their relationship with the CEO or CFO to introduce us to that employer. If we sign with the employer and they generate revenues, we pay the partners a referral fee.
Finally, we will engage directly with employers where we have established relationships and explain the value of our offerings firsthand. I believe this multi-faceted approach will ensure comprehensive coverage and maximize our chances for success in penetrating the employer market.