Founded in 2015, Hinge Health is a digital clinic specifically designed to treat musculoskeletal conditions such as back and joint pain. Hinge Health was born out of a growing need for better and innovative healthcare solutions for chronic back and joint pain.
The company has been around for a little over five years and has already hit the massive $3 billion valuation mark, so it’s time to dip into their business model and find out how Hinge Health makes money.
Hinge Health makes money by providing musculoskeletal healthcare plans to employers to purchase for their employees. The employees can access invaluable care along with tools and resources by utilizing the program.
About Hinge Health
Hinge Health is a platform that provides digital healthcare to those suffering from chronic musculoskeletal conditions. Supporting over 400 employers, the company has made its mark as a digital platform that provides assistance to employees and dependents. In doing so, Hinge Health has made physical therapy more accessible and affordable for all.
The company is built at the intersection of health and technology. The platform basically offers physical therapy and behavioral health service remotely by leveraging wearable sensors, an app, and health coaching.
Powered by science and technology, the company has 180,000 members on its platform.
Business Model of Hinge Health
Intending to reduce musculoskeletal pain with science-backed technology, Hinge Heath has quickly earned a reputation as a titan in the industry.
CEO and co-founder Daniel Perez grew concerned about the lack of aid for those suffering from the musculoskeletal disease. He realized that many sick individuals are forced to suffer in silence due to this improper care, and decided to do something about it.
Though study after study has been conducted on topics surrounding musculoskeletal health, the industry has not taken steps to adhere to their findings.
Hinge Health uses sensor technology, physical therapy, and health coaching to deliver a product that implements change. Many find Hinge Health to be the solution to their chronic pain, with the company servicing thousands in the community.
Considering 80 percent of Americans suffer from some form of chronic back or joint pain, Hinge Health takes on a heavy responsibility.
The company seeks to stray away from the typically suggested opiate and surgical solutions which are commonly ineffectively. Instead, they confront the problem by utilizing best practice care guidelines, powered by science and technology.
When asked why the focus on musculoskeletal health, Perez answers “it’s very expensive”. One-fifth of the GDP in America is spent on healthcare, with a sixth of that figure occupied by orthopedics and musculoskeletal health. Hinge Health vows to make physical therapy and support related to these conditions more affordable.
Those suffering from MSK-related conditions are often prescribed various medications and painkillers are a way to manage the disease. Hinge Health advises against this, opting for a more comprehensive approach to wellness.
While surgery is a common “solution” for many people with MSK issues, it is not the best one. Rather than pointing individuals to the surgery table, Hinge Health prescribes holistic physical therapy.
Those who join the company program quickly see the health benefit, with many able to avoid up to three surgeries. Three out of four people completing the program also see an approximate 70 percent improvement in chronic pain. This makes the program four times more effective at reducing pain than prescribed opiate medication.
Meeting with a physical therapist multiple times per week can be challenging, so Hinge Health meets members where they are. The company developed wearable sensors that guide members through their physical therapy sessions in a way that is personal to them.
For example, overweight individuals more prone to back and joint pain might seek weight loss as a healthy solution. Hinge Health goes the extra mile by educating themselves on problems unique to those who are overweight. The company integrates factors such as BMI into their program, ensuring that members are receiving care that most suit them.
The company believes that when you move better, you feel better, so they provide assistance in helping their members get moving. Many members report experiencing impactful weight loss since joining the program.
Hinge Health is about more than just chronic pain management or relief.
The goal of the company is to educate members on prevention as well. Because of this, they hired physicians and physical therapists to design their prevention program. In doing so, members receive customized education regarding how to prevent injury and disease most related to their lifestyles.
Medical experts are available to guide and educate members on small questions and large concerns such as whether surgery is necessary. In such cases, Hinge Health is there to support members along their journey from pre-surgery to post.
The company invests heavily in its members by teaching job-specific exercises, lending its impressive retention rate. Their website and mobile application offer many tools and resources that teach members all there is to know about MSK health.
Hinge Health takes a very personalized approach to health coaching. Recognizing that life happens, the company developed a coaching program that fits in with each members’ lifestyle.
Mental health problems are a common tie to musculoskeletal disease that Hinge Health is committed to solving. Members enrolled in the company program experience a reduction of anxiety and depression by about 60-70 percent.
Hinge Health shares its valuable tools and resources in order to provide ample support to the often-overlooked MSK community.
The company tripled its customer base in 2020, with a customer retention rate held at 100 percent.
How Does Hinge Health Make Money?
Hinge Health makes money from its digital healthcare plans purchased by employers. 1 out of 6 dollars (16.67%) spent in healthcare, is spent on back and joint pain. As a chronic condition management company, Hinge Health vows to provide an invaluable service to an underserved community.
The platform and program are available through employer-sponsored healthcare plans. In the U.S., approximately 160 million people acquire health care through their employer, a large market to tap into. The program is covered by most insurance plans so, for many, Hinge Health is completely free to use.
Hinge Health knows their worth and wants members to as well. The program is outcome-based which is why cost tends to vary from person to person. The company believes in a satisfaction guarantee, with the large majority of enrollees finding the platform to be highly useful.
A Stanford study found that Hinge Health delivered more promising outcomes to those suffering from musculoskeletal conditions. While the study showed that the company program is great for pain reduction and mental health, it also proved long-lasting effects. 70 percent of members are able to maintain their physical therapy exercise two years later without the aid of a coach.
The company is definitely doing something right, with notable companies such as Kraft Heinz, Walgreens, and Red Bull joining the platform.
US Foods has more than 400,000 of its employees enrolled with Hinge Health. They also reported seeing a 300 percent increase in revenue in 2020 alone.
Hinge Health Funding, Valuation, and Revenue
Founded in 2015, Hinge Health earned an impressive $8.3 million in their first funding round led by Atomico. The company would experience rapid growth in the years to follow.
The company raised $26 million in Series B funding in 2018. This funding round was led by notable investor Insight Partners. Following the round, Insight Partners increased its investment in the company, acknowledging its growing success. With this money, the company planned to expand further efforts to solve the disparity in healthcare related to musculoskeletal diseases.
With the majority of individuals remaining at home due to the COVID-19 pandemic, Hinge Health found an increase in interest. More than ever, people began opting for digital health care services to avoid. Even in the midst of a pandemic, the company saw extreme growth. In 2020, Hinge Health quadrupled their revenue at 300 percent, establishing themselves as a major player in the industry.
The company earned $90 million in funding in their series C funding round, bringing them to a $420 million valuation. Recognizing their rising success, investors quickly decided it wise to be a part of their journey.
This year, the company was able to earn $300 million in their series D funding round led by Coatue Management and Tiger Global. Thanks to investors, Hinge Health earned a $3 billion valuation, an increase six times larger than the previous valuation. This valuation helped them achieve one of the highest valuations for a privately owned digital health company in America.
The company surpassed $100 million in revenue according to a report from Reuters. They expect to double that figure in no time recognizing a recent shift towards digital healthcare. In addition to this, the company recently announced plans to go public, aiming for a date sometime in 2022.
The company has earned a total of over $426 million in funding to date. It is becoming increasingly more likely that their trajectory is to surpass that in the coming years. Based on their booked pipeline, Hinge Health expects their revenue to triple once more by the end of this year.
Is Hinge Health Profitable?
Hinge Healthcare is a health startup with a vision. The company is not profitable yet, however, the team is committed to improving the lives of individuals across the world by digitally connecting them to top-notch healthcare.
Since its start in 2015, Hinge Health has been gaining speed, creating a name for itself in the industry. The company is projected only to gain more momentum, opening to the public sometime in 2022.
With an impressive track record to back them up, Hinge Health is most certainly positioning itself for great success on the road ahead.
Conclusion: How Does Hinge Health Make Money?
So, there you have it – We dug deep into their business model and found out how Hinge Health generates its revenue.
All in all, Hinge Health seems to be a company worth investing in. It’s got brains, it’s got the brawn, and it has already shown its potential in such a short span of time.
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