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The returns are in, and they are not pretty. Janus Funds' billion-dollar investment in WebMD in 2000 now has a net value of roughly ten cents on the dollar, and many observers see WebMD as a winner in their space-whatever that space is now.
The returns are in, and they're not pretty. Janus Funds' billion-dollar investment in WebMD in 2000 now has a net value of roughly ten cents on the dollar, and many observers see WebMD as a winner in their space-whatever that space is now.
Promising e-strategies have been eclipsed by more conventional marketing approaches. Start-ups have dried up, and hospital e-networks are on life support. Health plan transaction engines are, for the most part, still waiting to transact, and the business of healthcare is conducted much as it was five years ago before the internet "changed everything."
The industry has not been fully inoculated against the epidemic of weak ROI. Many heartily funded, supported, and nurtured pharma e-units-some of which never delivered measurable ROI-are now challenged to avoid becoming footnotes in corporate history.
At a recent Wall Street investor conference, participants devoted much time to the "mystery" of information technology network failures in healthcare while similar strategies in other industries produced handsome ROIs. Mystery, indeed. Any serious healthcare student knows exactly where the problem lies: the docs aren't playin'. You know, those guys with the faintly stained white coats, logo'd pens in their pockets, and funny tubes draped round their necks. The folks whose patients demand to see them despite the "Mother may I?" morass of managed care, long hours in cheesy waiting rooms, and customer service that rivals the US Postal Service. Doctors, whose pens control 85 percent of US healthcare dollars-even as fewer dollars reach their wallets-have yet to join the e-health party. And, as healthcare history has repeatedly taught, if the docs ain't happy, ain't nobody happy.
Why have doctors refused to drink from the e-health punchbowl? The usual obstacles to physician adoption of computer technology-expensive hardware/software costs and complex training that would disrupt the practice-are not to blame. So what's the problem?
It's not a tough question if you look at physician needs versus e-health's past offerings.
The shared wish list of nearly all doctors is relatively simple:
That simple triumvirate of goals-love, loot, and limited liability (LL&LL)- is a central driver of physician behavior. Those needs are frequently intertwined, and one or two without the other is often insufficient to change doctors' behavior. So far, e-health is 0 for 3. A post-mortem comparing past e-health efforts to the LL&LL lexicon demonstrates the three-part failure.
E-health has yet to deliver a service that enhances the physician–patient relationship in any meaningful way. Ill-fated consumer portals-the icons of e-health-were often seen as physician surrogates or around-the-clock reservoirs of questionable content. Patients often printed that content and gave it to doctors, creating a new physician irritant. Although arguments against the value of improved patient access to quality healthcare information is a fool's errand, e-health's impact on the physician–patient relationship has not inspired doctors to embrace it. They already believe that their patient care is excellent, and therefore, they are not likely to jump onto the e-health bandwagon simply to support expanded patient information access-particularly when the information isn't coming from them.
The "killer application" that has the potential to enhance physician–patient relationships is, of course, e-mail. Ninety percent of doctors use e-mail, as does more than half of the US population. In addition, 90 percent of the patients who correspond online want to e-mail their own doctor, and most of them are willing to pay for the privilege.
Why should doctors participate in e-health, invest in a website, and communicate online with patients if the end result is time spent without dollars earned? After two decades of increased work without increased reimbursement, physicians are loath to take on any more. Unlike the unavoidable managed care mandates, doctors can and do boycott patient e-mail. Although nearly all physicians use e-mail, when asked about e-mail with patients, 90 percent simply say "nein!" But 90 percent of physicians surveyed also said they would use e-mail with patients if they were reimbursed and if their liability carrier covered the service. Indeed, a small but growing number of providers are delivering fee-based e-mail consults to patients. But who will pay-the plan or the patient?
It turns out that senior HMO executives lose little sleep dreaming up new ways to reimburse physicians. Payers will reimburse physicians for patient e-mail if and when it makes or saves them money. Fee-based patient e-mail could conceivably make them money if it increased market share or allowed them to increase premiums-neither of which is likely in the near term. It could save them money if, say, five reimbursed e-mails at $20 each eliminated one $110 office visit. Neither scenario appears on the immediate horizon.
Patients, in contrast, have shown a surprising willingness to pay for that access, both in surveys and in practice. The widely publicized cash payments to physicians for "boutique" or "concierge" care are indicative of a population increasingly willing to reach into their own pockets for better access to doctors. Twenty five percent of online patients surveyed in September 2000 by Deloitte Research said they would pay for the convenience of provider e-mail. Nearly 40 percent of women online, surveyed by Harris Interactive in August 2001, agreed with the idea of direct payment to doctors for e-mail, and a large percentage of patients said they would switch to a doctor who provided e-mail access.
Those facts are not surprising when taking into consideration the full patient cost of a visit to the doctor. Two to three hours of lost work and wages, a co-payment, plus gas and parking add up to a net cost of more than $50. Paying $20–$30 for the convenience of online physician access begins to look quite attractive to patients who increasingly value their time.
In addition to existing patients, the other source of online revenue for physicians is access to new patients. Doctors surveyed list "new patient marketing" as second only to patient education in reasons to create a website. But, despite some lingering interest among doctors in website search engine registration and catchy URLs, a growing body of evidence suggests that trolling for patients online is largely a waste of time and effort. More than 70 percent of insured patients search for and select a physician from their health plan directories, and a growing number of plans link directories to physician websites.
The Online Connection
The second most common source of online physician referrals are hospitals. Savvy doctors are, therefore, building and maintaining practice websites linked to health plans and hospital directories in an attempt to attract new patients to their practices. So is the e-health party about to get wild and crazy? Not yet.
National surveys confirm that concerns about security, privacy, liability, and, increasingly, HIPAA legislation, are the primary deterrents to online communications between doctors and patients. According to most physician liability carriers, those concerns are well founded. Countless physicians and medical groups have received warnings-or worse yet, no direction at all-from their medical liability carriers, leaving them confused and concerned regarding the potential risks of chatting with patients through the internet.
In 1999, a group of 33 liability carriers, along with numerous medical societies, formed the eRisk Working Group for Healthcare in an attempt to highlight potential liability issues associated with online physician communications. Since that time, eRisk participants have developed and promoted a group of specific guidelines for such exchanges. The latest set, featuring specific directives as well as fee-based online consultation guidelines, was featured recently in the Wall Street Journal. Prominent among the eRisk guidelines is a warning to physicians to avoid using standard e-mail with patients because it
The bottom line is that tools, products, and services introduced into the physician–patient relationship must be safety-proofed. And, as liability carriers are quick to point out, it is the doctor who is responsible for security, privacy, and HIPAA compliance. Taking actions that could result in patient lawsuits is hard to avoid when practicing medicine. Taking actions not covered by a liability carrier is insane.
The physician requirements of LL& LL have, therefore, been obstacles to e-health adoption, yet they are increasingly being addressed by patients and liability carriers. Secure patient communications' tools and services are finding their way into the hands of physicians, and online reimbursement is cropping up. Doctors are attracting new patients through provider directory links to practice websites. As a result, more than half of US physicians have a website, and more than 10 percent report regular online interactions with their patients.
Given that many companies are still writing down or retiring their "build it and they will come" e-health investments of the last few years, the sidelines may look attractive. But with physicians and patients increasingly communicating online, and a high percentage of patient questions focused on pharma treatment options, sitting on the sidelines could be a risky strategy. After all, who will provide physicians with the massive library of detailed product information they require to adequately address online patient queries? Who will author and support online tools such as interactive compliance programs that physicians, patients, plans, and pharma companies know will improve the current dismal state of medication compliance? Such online programs have failed in the past largely because of the lack of physician involvement, and therefore, of patient online engagement.
A strategy of meaningful pharmaceutical support, development, and investments in tools with which to engage physicians and enhance patient care should, however, be sanguine, fact-based, and predicated on three primary variables:
That formula for developing or evaluating an online engagement strategy requires decision makers to be realistic about the true value of tools and services for physicians. In addition, those three variables have interdependencies: available tools that offer LL&LL to physicians will drive online adoption. Also, online physician adoption varies somewhat by specialty and location but is easily measured.
Online tools and services typically fall into one of the following categories:
The final variable against which to gauge an e-initiative's strategic value is by far the most important and the most difficult because it requires painful honesty. The overarching question is simple: Will this product, strategy, or service deliver LL&LL to target physicians, or are we kidding ourselves? For example, will a physician–patient communications network owned, marketed, and operated by a single pharma company attract physician subscription and patient trust, or will it be met with howls from those concerned with physician liability and perceived conflicts of interest?
With LL&LL criteria in mind, pharma companies should consider the following approaches when engaging physicians:
Mitigate risks. Read and know eRisk and HIPAA guidelines and regulations. Lead with that knowledge when approaching doctors for all online activities. They may not ask, but they are concerned. Physicians are highly risk-averse and expect others to address their concerns, even if they can't articulate them well.
Pay for services. Understand that physicians are under financial pressure and are looking for legal and safe ways to supplement their income and get paid for their time online. Look for networks that have begun to address doctors' LL&LL needs and consider embedding online tools into them. In particular, seek out networks that offer revenue to physicians in the form of direct payment for participation or cost savings from increased efficiencies such as online health plan transactions.
Focus on products. Confirm that a substantial number of online questions from patients to physicians are about pharmaceutical therapies. Save physicians' time by providing them with FDA-approved online product information sources that are related to prescription products and integrated into networks already in use by physicians, so that they can use them to address patient questions. Then aggressively market those resources to doctors and promote their subsequent delivery to patients.
Highlight advantages. Market credible online product resources to physicians as a competitive advantage over comparable medications: "Drug A and drug B may be similar in efficacy, but your patients will better understand and comply with drug A because of our investment in an online support center."
Set realistic expectations. Acknowledge that the e-health is neither a miracle cure nor snake oil. Set realistic expectations for online physician engagement and hold e-health initiatives to the same-neither higher, nor lower- ROI metrics as other marketing initiatives.
Spread the LL&L message. Educate field sales forces about online physician behavior, LL&LL, and eRisk guidelines. Convince them that their sales can increase if they include the concept of online product support in their competitive positioning of key products when engaging target physicians.
All indications are that patient demand combined with LL&LL will continue to pull physician communications online. Pharma companies, as creators of the central agents of improvement in the human condition for the past century, have a key role to play. An informed, sanguine, fact-based approach to online physician engagement and investment strategies will not only help pharma bottom lines, it will also aid their physician partners immensely-to the benefit of all patients.