Zocdoc CEO: "Dr. Google is going to be replaced by Dr. AI"
Timestamps are as accurate as they can be but may be slightly off. We encourage you to listen to the full context.
Podcast Summary
In this live episode of Decoder recorded at the Tech Futures Conference in New York City, host Eli Patel interviews ZocDoc CEO Oliver Karez about the future of healthcare technology and AI integration. The conversation explores how ZocDoc has evolved from a simple doctor-booking app into a comprehensive healthcare platform that connects patients and providers wherever they are. (05:58) Karez discusses the company's strategic pivot from flat fees to per-patient pricing, which unlocked significant growth while maintaining relationships with healthcare providers. (09:10)
- Main themes: The episode centers on AI's role in healthcare, platform evolution in the smartphone era, and how ZocDoc maintains its competitive moat in an increasingly AI-driven landscape where traditional service providers face potential disintermediation from chatbots and agents.
Speakers
Oliver Karez
Oliver Karez is the co-founder and CEO of ZocDoc, one of the most successful healthcare technology platforms in the United States. Under his leadership, ZocDoc has grown to serve millions of patients and connect them with healthcare providers across the country. (18:18) Karez has navigated the company through major business model transitions and has positioned ZocDoc as a profitable marketplace that significantly reduces appointment booking time from 30 days (traditional phone booking) to within 24-72 hours for most appointments.
Eli Patel
Eli Patel is the Editor-in-Chief of The Verge and host of the Decoder podcast. He specializes in analyzing how technology companies operate and make decisions, with particular focus on platform strategies, AI implementation, and the intersection of technology with traditional industries like healthcare.
Key Takeaways
Hybrid AI Framework Delivers Better Results Than Pure AI Solutions
Karez emphasizes that ZocDoc doesn't rely on pure AI solutions but instead uses a "deterministic orchestration layer that uses LLMs selectively." (17:17) This approach ensures they can "take accountability" when conversations go outside the bounds of their system and need human intervention. The company has implemented this framework in areas where getting the right results is critical, giving them "complete confidence that we're not hallucinating" or going out of bounds. This strategic approach allows ZocDoc to leverage AI's capabilities while maintaining the reliability and safety standards required in healthcare, demonstrating that the future may not be about AI replacing everything, but rather about thoughtful integration of AI within robust traditional systems.
Platform Leverage Shifts in the Age of AI Agents
The competitive dynamics between platforms and AI agents are fundamentally different from the Google monopoly era. (33:52) Karez argues that companies like ZocDoc now have significant leverage because AI agents need their infrastructure to function effectively. As he explains, "There's five major LLMs or AI companies that are competing to be your agent. Imagine you had the one that doesn't let you order a sandwich, that doesn't let you book an Airbnb... would you use that one? No." This represents a dramatic shift from when Google was already a monopolist and could "ask for these tolls." Healthcare platforms with verified databases, regulatory compliance, and established provider relationships are positioned to negotiate favorable terms with AI companies rather than being displaced by them.
The Coast of England Problem Creates Sustainable Competitive Advantages
Karez introduces the "Coast of England problem" to explain ZocDoc's competitive moat - the more granular you get with healthcare data and processes, the more complexity you discover. (28:05) He explains that ZocDoc "didn't leave New York for four years just to make sure that we get even to a base level of this functioning" because there are both technology problems (integrating with EHRs) and "anthropology problems" (understanding how practice managers actually use systems). This deep, granular knowledge accumulated over 20 years creates a significant barrier to entry. New competitors might be able to start, but they would deliver "a dramatically worse experience than using ZocDoc" because they lack this detailed understanding of healthcare operations and edge cases.
Healthcare Consumer Behavior Reveals Physical Care Preferences
Despite the telehealth boom during the pandemic, patient behavior reveals strong preferences for in-person care. (08:51) Karez shares that "in everything but mental health, 95% of all appointments are in person." Even more revealing, doctors who offer both telehealth and in-person visits get more bookings than those offering only one option, but the bookings are predominantly for in-person visits. This insight challenges assumptions about digital transformation in healthcare and suggests that "somatic medicine" has physical requirements that can't be replaced by digital interfaces. The data indicates that while patients value having telehealth as an option, they still prefer physical examination and interaction with healthcare providers for most medical issues.
Marketplace Power Curves Enable Win-Win Pricing Models
ZocDoc's transition from flat fees to per-patient pricing illustrates how marketplace dynamics follow power curves that can benefit most participants. (19:36) While some high-volume doctors initially paid more under the new model, "all of these doctors, all the big spenders, actually came back" because "the quality of the patients I'm getting, the volume I'm getting, the predictability for my business is such that there is just no alternative." The power curve meant that doctors on the lower end of utilization got better value, while high-volume doctors recognized the superior patient quality and business predictability justified higher costs. This demonstrates how marketplace pricing can create sustainable value propositions even when raising prices significantly for some participants.
Statistics & Facts
- On ZocDoc, the plurality of all appointments happen within 24 hours, and nearly all happen within 72 hours, compared to an average of 30 days when patients call doctors directly. (07:34) This represents an order of magnitude improvement in healthcare access.
- In everything except mental health, 95% of all appointments booked through ZocDoc are for in-person visits, not telehealth, despite both options being available. (08:51) This statistic challenges assumptions about digital healthcare preferences.
- ZocDoc's AI assistant Zoe achieves a 52% conversion rate for patient calls, compared to other AI solutions performing below 40%, while average humans perform in the high 40s and the best human agents reach 65%. (15:55) This data was validated by an independent study.