How Discovery keeps innovating

hen we formed Discovery, we asked the question, “How do you innovate and build a health-insurance system that can work in this kind of environment?”

Our gut instinct was that if you can make people healthier, you can offer more sustainable insurance. It turns out that three lifestyle choices (smoking, poor nutrition, and poor physical activity) contribute to four conditions (diabetes, cancer, heart disease, and lung disease) that drive over 50 percent of mortality every year. So lifestyle choices are fundamental to any social-insurance system. The behavioral science tells us that people need incentives to make a change. But that wasn’t universally known at the time; we were just a start-up acting on a hunch.

When we were starting out, a massive gym chain approached us with the idea to sell our health insurance to their membership base—a classic cross-sales strategy. Our breakthrough came when we flipped this idea around: What if you can use the gyms when you get your insurance from us? But we couldn’t figure out how to afford it.

Then we thought, “Well, what if you earn points by doing healthy things? Then those points give you access to cool rewards and a discount on your premium?” That idea was the catalyst for everything, which I think is true of innovation. It’s a moment in time. It’s not always a revelation in a laboratory. In my experience, it’s right there in front of you. Once you get it, you run with it.

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