YouHaoYa Files for IPO: Building a Dental Insurance Network with Coverage Across Over 100 Treatment Items and Nearly 100 Partner Clinics
Delta Dental is the largest dental insurance provider in the United States, serving 67 million insured members. In China’s dental market, which has not yet been fully liberalized compared to that of the U.S., insurance penetration remains in a growth and window-of-opportunity phase; it is precisely here that opportunities lie.
Before founding the Youhaoya brand, Yu Donghui had already spent over a decade navigating the insurance industry, with multiple entrepreneurial ventures in internet insurance. He co-founded Datebao, which saw its valuation increase more than 100-fold within three years, making it one of the top-valued startups in the internet insurance sector today.
He believes that most internet insurance startups are still largely following the traditional channel-based model. “The problem with the channel model is the lack of core product competitiveness. All competitors offer identical products, and barriers to entry are low. Ultimately, competition boils down to the customer acquisition capabilities of offline agents, resulting in a vicious cycle of cutthroat competition for both service providers and product suppliers.”
Where lie the opportunities for breakthrough? Yu Donghui has set his sights on the rapidly growing health and wellness industry in recent years, along with its complementary health insurance sector. “Due to the lack of effective cost-control systems and medical service networks, health insurance has largely competed at the product level. In the future, competition in health insurance will undoubtedly hinge on comprehensive medical networks, cost-control capabilities, and service quality. This strategic direction is sound.”
Why Choose Dental Insurance with YouHaoya? What Problems Can It Solve for Patients and Clinics? VCBeat (WeChat: vcbeat) Conducted an Exclusive Interview with Yu Donghui, Founder of Beijing Bill Shawn Technology Co., Ltd. (Brand Name: “YouHaoya,” Hereinafter Referred to as YouHaoya).
Yu Donghui, Founder of Haoya
Youhao Ya has chosen to focus on the dental care niche market, primarily for three reasons. First, dental services receive minimal coverage from public medical insurance. Second, the dental industry exhibits a relatively high degree of standardization and marketization, making it well-suited for the development of insurance products. Third, the rapidly growing dental market is sufficiently large in scale, with an ample number of clinics.
“China’s dental care market currently exceeds RMB 200 billion in size. Given the vast consumer base, it is projected to approach the trillion-dollar scale of the U.S. market in the future. In recent years, investments have focused more on dental clinics and related supporting infrastructure. As a result, there is gradually emerging strong demand for matching financial services, making the current period a favorable window of opportunity.”
Currently, the dental clinics dominating the market fall into three main categories: the first comprises large branded chains, such as Arrail and Happy Dentistry; the second consists of community-based clinics with strong medical capabilities and a high cost-performance ratio; and the third includes solo-practitioner clinics, some even located in office buildings. Haoya primarily partners with the second category—community-based clinics with robust medical expertise—and currently collaborates with nearly 100 such clinics.
As for the reasons, Yu Donghui revealed: “Small clinics lack brand recognition and suffer from low patient trust, while large chain clinics have a relatively fixed customer base and offer lower insurance discounts. Currently, insurance products targeting large chains on the market often lack the capacity to expand offline clinic networks; they merely require signing contracts directly with the clinic headquarters, which limits their scalability.”
Beyond differences in clinics and patient demographics, Haoya has implemented rigorous controls over medical quality. “For every partner clinic, our offline business development team conducts thorough audits of dentists’ and clinics’ qualifications and capabilities. Moreover, our products are priced at just tens to one or two hundred yuan, which stands in stark contrast to mainstream preventive liability insurance products on the market that typically cost over 700 yuan. Such high-priced products create prohibitive barriers; clinics are unwilling to promote them because the steep discounts would result in clear financial losses. A primary motive for clinics to collaborate with insurance providers is to acquire new customers. If an insurance product fails to bring new patients to the clinic, the partnership will not be sustainable.”
Yu Donghui told reporters, “Given the current landscape where patients have not yet developed regular dental care habits and clinics generally struggle with a lack of customers, our primary focus is on treatment rather than preventive services. Products centered on prevention are, to some extent, equivalent to selling teeth-cleaning packages; individuals with teeth-cleaning needs are unlikely to purchase insurance products, as it is more convenient for them to buy cleaning packages directly through Meituan. This makes promotion extremely difficult. If we do not start with treatment, no one will be willing to visit the clinic, and we cannot generate value. At this stage, we should not offer products with high entry barriers or high unit prices, as this would exclude potential customers with genuine needs before those needs are fully activated.”
In the absence of disease, few people visit dental clinics. Insurance and clinics share a natural affinity for collaboration. Drawing a comparison with U.S. dental insurance, Yu Donghui stated, “Partnering with insurance providers not only secures a stable patient base—which may account for 50%–60% of total patients—but also serves as strong brand endorsement. Clinics that fail to meet insurers’ requirements cannot join their provider networks; those lacking integrity or professionalism will be removed from the network after a period of cooperation.”
“For patients, beyond price discounts, what they seek most in healthcare spending is reliability and trust. Therefore, having long been a partner within the insurance network demonstrates our consistent quality, operational integrity, and ease in gaining patient recognition.”
So, what are the differences between the Chinese and U.S. dental markets in terms of patient visits and costs? Yu Donghui shared his experience of receiving dental care in Seattle, Washington State.
“In Washington State, a dental cleaning costs approximately $50, while an examination and X-rays combined cost around $100, bringing the total per-visit expense to $150. Among the U.S. population of 300 million, excluding the elderly and children, roughly 100 million people require dental cleanings. At twice a year, this amounts to a total expenditure of $30 billion, which is less than one-quarter of the overall $130 billion spent on dental care in the United States. Moreover, Seattle is a high-income city, where costs are relatively higher.”
In terms of cost structure, the primary revenue source in the U.S. market, and the truly expensive segment, is prosthodontics.
“Basic routine treatments, such as root canal therapy, cost approximately $800 in the United States compared to around 800 RMB in China, making them more expensive in the U.S. For more costly procedures, such as dental implants, prices are relatively similar: about $3,000 in the United States versus roughly 20,000 RMB in China. However, the penetration rate of dental implants is significantly different, with 100–120 implants per 10,000 people in the United States, compared to only 2 per 10,000 people in China, indicating a substantial gap in market volume.”
“Given the small base and the rapid growth of the implant and orthodontic markets in China, we believe that the dental industry will trend positively. Meanwhile, in the dental market dominated by routine treatments, patient awareness is rising, driving substantial demand and very rapid price increases. Although prices have not yet reached U.S. levels, the gap is narrowing.”
Where will genuine insurance cost control actually take place? Yu Donghui stated, “Cost control primarily focuses on treatment-related services, such as dental fillings, root canal therapy, and periodontal treatment. There is room for cost containment in these areas, given that the dental care market remains relatively opaque. As a payer, insurers can effectively audit the materials used by clinics and dentists to manage expenses, creating a win-win scenario for clinics, insurance providers, and patients. With rising dental treatment costs and evolving consumer habits, significant opportunities lie ahead.”
In the actual product promotion process, Yu Donghui frankly stated that clinic acceptance is highly polarized. “The current market situation closely resembles what Delta Dental, the largest dental insurance provider in the United States, encountered during its initial rollout. Some doctors willing to collaborate believe that we can bring them a steady stream of patients and resolve operational challenges, allowing them to focus on improving their clinical care. Meanwhile, long-established clinics often do not have an urgent need for patient acquisition; some even small chain clinics already have mature marketing strategies, making collaboration progress more slowly.”
Leveraging its channel advantages, Youhaoya adopts a sales model that collaborates with established insurance brokers, insurance agents, and other ancillary channels to fully utilize existing customer resources for secondary expansion, while keeping customer acquisition costs under control.
“We currently maintain collaborative relationships with major insurance brokers and agencies, giving us a deep understanding of both channel and customer needs. On the surface, this may appear to be a channel-driven business, but at its core, the product itself must be strong and meet customer needs.”
Dental care services covered by Youhao Ya are classified according to the standardized classification system of U.S. insurance ATA, encompassing more than 100 items. The major services are divided into three main categories:
The first category comprises preventive services, under which patients receive complimentary dental cleaning, examinations, and other services upon visiting the clinic;
The second category is basic treatment, which focuses primarily on restorative procedures such as dental fillings, root canal therapy, tooth extraction, and periodontal treatment; clinics offer discounts of approximately 50% off.
The third category comprises complex treatments, including orthodontics, dental implants, crowns and inlays, as well as the use of other costly materials and cosmetic procedures; clinics offer discounts ranging from 20% to 40% off.
In terms of its revenue model, Haoya primarily derives income from two sources. The first is front-end product sales: “When insurance products are sold, we charge the insurance company a technical service fee or network usage fee, which accounts for 5%–10% of the premium. The other source is commissions paid by clinics for complex treatments. Drawing on international dental insurance pricing models, we believe that as the dental industry develops, this commission-based portion will decline amid intensifying competition. In the future, we will offer a more diverse range of products, and our revenue will increase as the financial attributes of these offerings are strengthened.”
Yu Donghui revealed some backend data: “Once users purchase our products, they will inevitably visit a clinic for diagnosis and treatment at some point within a year. Of course, our customer service’s re-engagement efforts are also crucial, making the first experience particularly key. We carefully select high-quality clinics, which not only reduces patients’ search costs but also lowers treatment expenses. Through our continuous services, we turn patients into long-term clients and change their consumption habits via prepayment models.”
Currently, Haoya has begun its expansion in 12 cities across China, with clinics primarily concentrated in Beijing, Shenzhen, and Shanghai.
Regarding future development, Yu Donghui stated, “By accumulating standardized data related to diagnosis and treatment, we can achieve automated alerts for anomalous pricing. Additionally, in the context of medical imaging, clinics must provide both treatment records and dental radiographs when settling claims with insurance companies to assess whether overtreatment has occurred. In the future, as imaging data accumulates, AI will be able to capture and audit dental radiographs in real time, thereby reducing manual effort and further lowering management costs.”