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Scaling a health care startup in the Trump era? Hire an innovation whiz

Zest Health, a Chicago startup that aims to help patients find high-quality, low-cost medical care, has wooed a seasoned executive of Fortune 500 companies to help the fledgling business bulk up. Jeff Semenchuk, former innovative chief at Hyatt Hotels, succeeds Ann Mond Johnson, who is out after less than two years in the role.

Glen Tullman, one of five board members of Zest, said Johnson did a "terrific job" establishing and stabilizing the three-year-old business. But the board sought Semenchuk, 57, for its next phase, which is growth. "The question is how do you scale it and move Zest Health to where it becomes Google or LinkedIn," or any other service that has vastly expanded, said Tullman, the former Allscripts chief who now leads Livongo Health, a diabetes management startup.

Jeff Semenchuk

Zest, which is backed by venture firms Lightbank and 7wire Ventures (where Tullman is managing partner), launched in 2014 and has raised about $10 million from investors.

Here's how it works: Employers and health plans pay Zest a fee to provide its workers and members access to its mobile app, which they can use to find which doctors and hospitals in their networks offer cheaper rates. Through Zest's app, people also can connect with a nurse 24 hours a day, book a doctor's appointment and estimate how much the visit would cost.

The startup serves more than 500,000 consumers through their employers, insurance brokers and health insurance companies, including Blue Cross & Blue Shield in Rhode Island and Massachusetts.

Semenchuk previously led Citigroup's growth ventures and innovative unit and was head of global innovation at Pfizer Consumer Healthcare. At Hyatt, he came up with the idea to use your smartphone instead of a key to open your hotel room. At Citigroup, he launched a program in Singapore where transit riders could get a Citi card with a transit chip, then essentially earn free rides for simply using their cards when shopping.

At Zest, Semenchuk is looking to expand the app to the average consumer. They would essentially pay cash to find doctors and hospitals through the app and know up front how much a medical procedure or office visit would cost, said Zest President Shawn Ellis. "Think about Etsy or Grubhub, where the consumer goes to a marketplace that's curated for them around types of food or types of art (they) want to buy," Semenchuk added.

Zest likely would get a small fee from providers for sending business their way.

The startup is essentially tapping into the increasing number of consumers shouldering a higher percentage of their medical bills as companies shift workers to high-deductible health plans. There's also the uninsured, a particularly price-sensitive group that could swell under the House Republicans' plan to overhaul the Affordable Care Act enacted under former President Barack Obama. Those are potential Zest customers. "Regardless of what happens with the old ACA or the new American Health Care Act, there's just so much confusion and so much angst," Semenchuk said.

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