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PayNearMe partners with Washington to promote the Health Insurance Marketplace to the underbanked

By Michael Carney , written on December 11, 2014

From The News Desk

With Open Enrollment season fast approaching for the Affordable Care Act, the federal Department of Health and Human Services (HHS) is turning to Silicon Valley to more effectively reach eligible consumers. Later today at a live event in Washington, DC, HHS Secretary Sylvia Matthews Burwell will announce a partnership with electronic cash payments company PayNearMe aimed at reaching the un- and under-banked.

PayNearMe allows consumers pay for rent, loans, utilities, public transportation, municipal government fees, and online transactions using cash at over 17,000 total payment locations, across the US, including 7-Eleven, Family Dollar, and ACE Cash Express stores. From now through the February Open Enrollment deadline, physical and digital receipts issued at 7,800 nationwide 7-Eleven stores following these transactions will include a special message informing consumers about upcoming Affordable Care Act deadlines and discussing options such as tax credits and new HealthCare.gov plans. Today’s event was held at a DC-area 7-Eleven store.

“Banked or unbanked, cash or plastic – no matter what your preference, everyone can benefit from affordable health care,” says PayNearMe founder and CEO Danny Shader. “By partnering with the Department of Health and Human Services, we can help generate awareness of this open enrollment process among consumers.”

There is no commercial element to the PayNearMe-HHS partnership, meaning no money is changing hands. Rather, this is an opportunity for the five-year-old technology company to use its platform for good, while working more closely with Washington and the healthcare community in general, relationships which it believes will pay long-term dividends.

“I’m always careful not to wrap ourselves in this banner of being do-gooders,” Shader says. “But this really is a good signal for a technology company, especially one dealing with the underbanked, to do something positive for the community and help the government more effectively communicate with its citizens.”

The PayNearMe receipts are an ideal medium for high-value messaging, according to Shader, because they are typically associated with important payments and thus payees look them over closely and save them as proof of payment for their records. Each transaction results in both a printed, paper receipt, and a digital copy saved to the payee's individual PayNearMe account, which is accessible online and via mobile app. Both versions of all receipts issued between now and April will have the HHS messages printed on them, a first for either organization.

PayNearMe was among several technology companies to participate in a series of so-called White House Business Council dinners aimed at fostering public and private sector cooperation in addressing social and economic changes in the country.

HHS Director of Private Sector Engagement Rhett Buttle, and Assistant Secretary of Public Affairs Kevin Griffis point to learnings from earlier Healthcare.gov initiatives as the motivating factor behind this partnership in particular, including the need to proactively outreach to consumers through familiar channels. Secretary Matthews Burwell makes a similar point, saying:

Leveraging developments from technology companies like PayNearMe helps us to reach our consumers where they are, with the information they need to sign up and re-enroll in quality, affordable care through the Health Insurance Marketplace. With this partnership, we are using digital platforms to place Open Enrollment information in the hands of consumers who need it.
HHS previously announced partnerships with Westfield Malls, National Community Pharmacists Association, and XO Group (owner of The Bump, The Knot, and The Nest), similarly aimed at promoting the national health insurance marketplace. Griffis indicates that other similar technology industry partnerships will soon follow.

For PayNearMe, deeper ties with Washington are a direct and tangible result of the company’s recent hiring of Jotaka Eaddy, former Senior Advisor to the CEO of the NAACP, to lead government affairs. When Eaddy first joined, there was no singular objective for her role, such as “we want to process health insurance payments,” according to Shader. Rather, the goal was for her to begin building relationships in this sector and educate PayNearMe’s existing leadership about “what it didn’t know.”

“We’re very active in the regulatory environment today, the payments category in general is very highly regulated. And we work with the state of Nebraska and the city of Pittsburg, for example, processing cash payments,” Shader says. “But we’re from Silicon Valley and we know payments, not politics. We didn't know what we didn't know. Jotaka has been great at opening our eyes and helping us demonstrate the power of the platform.”

While nothing is set in Stone, Shader indicates that PayNearMe is working with several healthcare industry partners and could begin accepting payments in that sector in the near future, including in California, the company’s home state.

“The things we do typically have very long lead times, but I’m not aware of another system that can do frictionless cash transactions the way we can,” Shader says. “We don't position ourselves against prepaid cards, but most of the people we work with typically don't have a lot of extra balance they want to store. It may be surprising, but the underserved tend to be the most rational about their money, because they have to be.”

Given the long history of confrontation between Silicon Valley and regulators, it’s a welcome change to see some cooperation between the two parties. PayNearMe is a rare platform that is able to effectively reach underbanked Americans, and in this instance, the company is very much using that position for good.