Telemedicine is the future of Health Care! Logo

American Well Gaining Converts To Telemedicine

Posted 07/11/2011 05:56 PM ET

Telemedicine connects patients remotely with health care experts. AP

Telemedicine connects patients remotely with health care experts. AP View Enlarged Image

It seems you can do everything online — book a vacation, watch a movie, chat with friends, find a date — so why is it still so hard to get hold of a doctor?

The rise of the Internet brought new opportunities for telemedicine — the delivery of long-distance medical care, which was once restricted to phone lines. For over a decade, the tech industry has promoted the idea of doing doctor-patient visits online. But doctors have always had a question: How do we get paid for it?

They’re getting answers, as some health care payers are jumping on the telemedicine bandwagon. In 2009, Blue Cross Blue Shield of Hawaii contracted with medical IT firm American Well to make its online system available to all its members. Since then, BCBS plans in Minnesota and New York have picked it up. So has managed-care giant WellPoint (WLP). Last month, American Well launched in Australia and New Zealand.

The company’s service is more than just talking to your doctor on the phone. In fact, you might end up talking to a doctor you never met before. Doctors who choose to participate go online when they have the time. Patients can go to the website and search for an available doctor who can deal with their problem.

Once they’ve connected, the doctor can chat with the patient and look up the patient’s records on Microsoft‘s (MSFT) HealthVault, an online medical-records system that has a contract with American Well. After that, it goes more or less like any other doctor visit.

Of course, nothing takes the place of an in-person exam when it comes to diagnosing many conditions. But American Well President Roy Schoenberg says telemedicine is a way to do work that’s less critical but important over the long haul.

“A typical example is elderly, chronic patients (who) consume 90% of the health care dollars,” Schoenberg told IBD. “If you are a diabetic patient, you need to see five or six different physicians regularly. What we see very often is patients just don’t (get the exams) — it’s too difficult for them. A whole array of bad things happen to them, which eventually bring them to emergency rooms.”

Also, some conditions are diagnosed mainly by listening to patients’ reports. Dr. Eric Christianson, who works at Fairview University Medical Center in Minneapolis, gives the example of chronic sinusitis.

“That’s something that you could treat with antibiotics, just given the interview and discussion of treatment with the patient,” he said.

Takes Some Getting Used To

Christianson says doctors and patients were nervous about using the American Well system at first. But he says after they used it a few times, they saw the advantages.

“The first time (patients) were able to be online and not have to take three hours off their workday or load up the kids and go into the clinic, and they were still able to get their needs met, it ended up being positive,” he said.

Another worry American Well had to soothe was malpractice insurance. Traditional policies were designed assuming the doctor’s patients would be regulars, not one-off visitors online. So American Well collaborated with AIG (AIG) to write up a malpractice policy designed for the online care system.

Getting large insurers on board is crucial for telemedicine, but there are other possible means of support. Last November, giant drug-store chain Rite Aid (RAD) contracted with American Well to offer telemedical services in its pharmacies, so that patients can find pharmacists with specialized expertise if none are available in the store.

In April, American Well rolled out a slimmed-down version available to doctors nationwide without the backing of health insurers. Schoenberg says this product is aimed at accountable care organizations, a newer model of health care that pays doctors proportionately to their results. This model encourages extra contact with patients to ensure good health.

William Blair analyst Ryan Daniels says another big future driver of telemedicine should be ObamaCare.

“When we think about 40 million additional Americans having health insurance, the big question is, ‘Where are they all going to find doctors?'” he said. “Today you can walk into an emergency room and they have to treat you. The way to cost-cut in the future will be more direct relationships with primary-care doctors, and this is one vehicle that could allow that.”

Yet, the online consultation field is still very nascent. Daniels says the only other sizable player in this field is Teladoc, a network of physicians that offer services by phone and online for minor medical issues. There are no publicly traded companies in the online consultation field yet.

In a June 28 report, Gartner analyst Joanne Galimi noted the lack of data on whether online consultation actually saves money. She also says the issue of physician pay still isn’t totally resolved, since “most health care systems do not reward physicians for keeping patients well (or less sick), only for treating them when they become sick.”

She recommended that medical firms not invest in real-time online consultation technology until at least 2013.

Still, Dr. Christianson suspects he’s seen the future.

“This is going to be a cultural shift,” he said. “And as the culture shifts, it’s going to become more accepted by everyone.”


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