WebMD: The Patient Value Equation - Pharmaceutical Executive


WebMD: The Patient Value Equation

Pharmaceutical Executive

PE: Leaving the digital world for a moment, I read that WebMD is now involved in some offline coaching, and that the payment structure is based on patient utilization. Can you explain that program, and why WebMD is dabbling in offline services?

Schlanger: We have an enterprise business that goes to large corporate employers and health plans and sells them population health management and wellness services. We have a full suite of digital capabilities, and it starts with a health risk assessment, which serves as the bases for a personal health record. We import medical claims and pharmacy claims to pre-populate the health record. There's a digital smoking cessation program, a digital obesity program, and digital condition management programs. These online programs help patients manage their issues, but certain people need more intervention: digital intervention isn't always enough. So we do have a coaching center where we have dieticians, nurses, and exercise physiologists helping people who need more of an intervention. That's typically paid for based on the volume of coaching we provide. This is only offered if you are an employee of one of our corporate customers, or a member of one of our health plan customers.

PE: WebMD recently scored a Blue Cross Blue Shield Association Federal Employee Program contract that supports over 5 million members. How important is health plan management as a business sector, who are your competitors, and how is it different for your traditional business areas?

Schlanger: It's more competitive, and it's a pretty fragmented business. It's everything from players like Healthways, Aetna, UnitedHeath through their Optum division, and lots of little players. Castlight Health went public. Cost transparency is a piece of it, a little company called RedBrick Health. But I think WebMD is unique in that people really trust the brand. The [Blue Cross Blue Shield] federal contract is the biggest in the history of that business area.

PE: What percentage of total revenue comes from that business division?

Schlanger: Somewhere in the neighborhood of 18 percent of our total revenues.

PE: WebMD has also made some notable progress toward global expansion, first with your 2009 Boots partnership in the UK, and more recently with DXY, the physician portal in China. How would you describe WebMD's role in China, for example, and what you'd like to accomplish through your partnerships outside of the US?

Schlanger: Health is very much a local offering. You can't just necessarily assume that because we have an article here or a capability there, that you can just translate the language and have it make sense. The greatest example of this is in the UK. We got into it as a kind of experiment. Boots has been a terrific partner, and now that they're aligned with Walgreens it's even better for us. We're now the largest health site in the UK, but it's solely a consumer package goods opportunity [on the consumer side, since DTC advertising is illegal]. One thing we learned by being there is that even though it's English to English, we had to basically rebuild a new site. Every article is Anglicized, which is a word I didn't know about five years ago. It could be as simple as, in a slide show, showing a picture of Oxford Street in London instead of Eighth Avenue in New York.

To be credible, and to give health advice, you have to be there. If we're giving people advice about eating, the foods have to be available and part of the cultural taste buds. The way that we treat disease might be similar, but it's not exact. On an even higher level, the term "MD" means nothing in these countries. In fact, when I first went to the UK and met with Boots, they said, "You know, no one knows what MD means here. It means Managing Director." They know the term GP, but not MD. On the professional side, with Medscape, it's a different story, because English is the international language of medicine, and many doctors outside the US are educated in English. We engage about 300,000 physicians outside the US.


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