NEW YORK (TheStreet) -- Teladoc (TDOC) - Get Report stock jumped 50% in the company's first day of trading Wednesday as investors gobbled up shares of the first so-called telehealth company to go public. Shares are down 3% Thursday to $27.60.
Teladoc CEO Jason Gorevic said the technology may be better but the underlying business has actually been around for ages.
"Doctors and patients have been seeing each other whether in person or remotely for generations," said Gorevic. "Long ago it was somebody picking up the phone and calling their family doctor because they needed help. Today we have taken modern technologies to connect patients and physicians remotely, all over the country, 365 [days a year]. And because we have this great technology platform we can do it in incredibly rapid time."
Teladoc priced 8.3 million shares of its common stock Wednesday at $19 per share, above the predicted $15 to $17 range. The company raised $157 million in the offering. Shares of the company ended the day at $28.50 giving it a market capitalization of $1.02 billion.
Gorevic said the company's median response time is a conversation with a doctor in less than ten minutes. Last year the company matched doctor and patient over 300,000 times and Gorevic expects that number to rise to more than 500,000 this year.
Gorevic said the telehealth model lowers costs and reduces stress in the system by alleviating the pressure of crowded hospital emergency rooms that are busier than ever due to increased coverage provided by Obamacare.
"The Affordable Care Act puts more people into the insured ranks, while at the same time we have an increasing and ageing population and that puts more and more pressure on the system. We are not minting new doctors every day," said Gorevic. "The supply is just not keeping up. We open up more access for consumers and that drives down costs."
In terms of supply, Gorevic said Teladoc has over 700 physicians in its ranks, all board certified with an average of over 20 years of experience. And they work at their own convenience.
"They work with us, whenever they want, from wherever they want and they get paid on a per visit basis," said Gorevic. "There is no overhead. There is no hassle. They don't have to fill out any claims forms. They love what they do for us because we drive volume to them and they get to do what they went to medical school for which is practice medicine."
Teladoc works with over 20 health plans all across the country. And with respect to the merger mania going on in the health insurance sector, Gorevic predicts his company will be "a winner no matter what happens there."