Disease management poised to become a multibillion dollar online industry

Disease management poised to become a multibillion dollar online industryInternet makes services available to broader patient baseLong before the term “e-health” came into fashion, disease management (DM) had established itself

Disease management poised to become a multibillion dollar online industry

Internet makes services available to broader patient base

Long before the term “e-health” came into fashion, disease management (DM) had established itself as a viable telemedicine application, primarily because of its ability to reduce costs and improve the quality of care for homebound and chronically ill patients. In the last decade, numerous DM projects have documented the role of home-based monitoring and telecommunications in reducing hospitalization, enhancing quality of life, and improving compliance and outcomes for patients suffering from congestive heart failure (CHF), asthma, diabetes, kidney disease, cancer, high-risk pregnancies, and other chronic conditions.

Even so, vendors of DM products and services have struggled to meet revenue projections, and a number of companies have already come and gone. But the Internet promises to change all that. While DM currently generates $350 million in annual revenue in the U.S., the Internet has the potential to push this market into the $50 billion to $100 billion range over the next decade, according to “Jenks Healthcare Business Report,” an electronic publication available through the Healthcare Intelligence Network.

As a result, companies are lining up to explore the Internet’s role in implementing DM programs. Combined with the increasing trend among healthcare providers to outsource their DM programs, the industry is looking at a near-term boom.

“Deloitte and Touche did a study last year that estimated that 50% of health plans have disease management programs in place, but most are paper-based,” said Carl Tsukahara, vice president of marketing for Confer Software, a leading provider of Web-based disease- and care-management products and services. “The advent of the Internet enables some things that will make disease management far more effective and make it much easier to measure that effectiveness.”

One advantage the Internet offers is more consistent access to detailed information, which can help healthcare organizations anticipate and respond to problems and emergencies. It also makes it easier to market DM and preventive-care products and services directly to consumers and to monitor compliance with these programs.

In fact, a number of the healthcare dot-coms launched this year are focused on helping consumers improve their health and well-being, as well as simplifying and improving the disease management process. For example, GlobalMed, a medical information technology firm based in Denver, has introduced a suite of chronic DM products through its newly established PeopleMed.com subsidiary. The company is offering these products via an application service provider (ASP) model and has signed a contract with a regional division of a large HMO to provide DM services on a per patient, per use basis.

Similarly, LifeMasters, a company founded in 1994 and backed by Intel, offers both ASP and direct-to-consumer versions of its interactive health-monitoring and coaching program. The Newport Beach, CA, company, which claims 15,000 enrollees overall and 550 participants on its LifeMastersOnline.com Web site, also makes its services available through partnerships with consumer Web sites, including iVillage, WellMed, and The Health Network.

MedicaLogic/Medscape has entered this market niche as well, forming a strategic partnership with Lifechart.com to integrate Internet and wireless DM tools and services with MedicaLogic’s EMR products. The company has also taken a 10% stake in Lifechart.com.

But these companies represent only a portion of the disease and care management industry. Vendors that offer products and services for acquiring, compiling, storing, and analyzing patient data for chronic conditions make up the core of this industry, and many of these firms are also turning to the Internet and related wireless technologies to enhance the data-gathering process and patient outcomes.

For example, Agilent celebrated its independence from Hewlett-Packard this year by launching a new Web-based and wireless strategy for the patient-monitoring division of its Healthcare Solutions Group (HNN 5/17/00). In addition, the medical division of Cybernet Systems, a $10 million R&D firm in Ann Arbor, MI, is commercializing Web-based patient-monitoring and data-collection devices it helped develop for NASA, the National Institutes of Health, and the Department of Defense. Rather than marketing this technology themselves, Cybernet is partnering with firms that already have a foothold in certain sectors of the disease management market.

“Many of these companies have done this for a long time but have not taken their products onto the Internet platform,” said Greg Emery, senior vice president of Cybernet. “We are looking to license our technology and help people build patient-monitoring devices that can be worn continuously and are smart enough to recognize when a significant event occurs and place some priority on that.”

At the heart of this strategy is Cybernet’s new patent (U.S. #6,050,940), which covers the use of the Internet and wireless connectivity for portable instruments that measure physiologic data such as EEGs, EKGs, and blood pressure and pulse oximeters. The patent also covers the remote acquisition and transmission of medical data across the Internet for processing and relaying to medical practitioners for review and diagnosis. The company sees this property as a platform for moving specific aspects of DM onto the Internet and designing networks that can move patient data as quickly as possible.

“We are building a service that we can operate or license to others to operate that gives our customers the infrastructure to collect and display the data via the Internet,” Emery said. “This means the physician can go home and check the most recent patient activity, or even archived activity, using a standard browser-based system.”

Cybernet is not the first company to recognize the value of making DM processes available on the Internet. Confer has built its business on Web-based applications for DM, case management, utilization management, wellness, and self-care, all of which are designed to support evidence-based medicine. The Redwood City, CA-based firm also developed and patented the healthcare industry’s first XML-based process automation platform, dubbed ConferWeb, which serves as the foundation for all of its software products.

“We build an adaptive management framework for disease management, then build in modules tailored to specific diseases (CHF, diabetes, asthma, oncology, and obstetrics),” Confer’s Tsukahara said. “And once the solution is in place, you can start to collect data on what programs are really improving healthcare and outcomes. And because you can put it on the Internet, everyone (in the organization) can use the same database. So you really get a patient-centric snapshot of their care state.”

Confer, which was founded in 1994 and introduced its first product in 1996, currently claims about 20 customers (health plans and providers). The company also partners with data acquisition and patient-monitoring companies, such as Health Hero and Agilent, and is involved in a CHF study with Agilent at Anthem Blue Cross and Blue Shield in New Hampshire.

Another recent entry into the e-health space is CorSolutions, which historically has taken a call-center approach to DM that links each patient with a dedicated nurse. Like most of its competitors, the Buffalo Grove, IL-based firm sells its services to HMOs, integrated delivery networks, insurance carriers, and other managed-care organizations. The company claims 30 customers and has developed a large database of clinical outcomes information that is collected from the patients and returned to the providers and payers.

In a strategic move designed to leverage its DM business by using the Internet to lower transactional costs, improve program satisfaction, and broaden access to DM, CorSolutions has established a Web-enabled subsidiary called eCorSolutions. In CorSolutions’ traditional DM program, nurses maintain regular contact with chronically ill patients by telephone using Multifit, a protocol-based clinical decision support system developed at Stanford University and licensed exclusively to CorSolutions. With eCorSolutions, DM services will be offered online through partnerships with health information portals and provider Web sites. eCorSolutions has already partnered with Mediconsult.com, a leading provider of online healthcare solutions, information, and tools for physicians and patients.

“The link with Mediconsult gives us access to consumers who are not already affiliated with managed-care companies,” said Peter Smith, CEO of CorSolutions. “We believe the consumer market is going to open up.”

A larger patient base means more data, which leads to better outcomes analysis, another key component of DM. CorSolutions claims to have more than 300,000 patient-months of data in its coffers and currently collects about 100 points of data per patient per month. The data are sent to an integrated data warehouse in Boston, where biostatisticians reengineer the data and perform regression analyses to determine trends and outcomes and formulate clinical decision support tools. This information is then supplied to CorSolutions’ customers, who in turn use it to streamline delivery and patient care processes.

Despite growing interest in online DM services and the corresponding explosion in interactive Web-based operations, however, the costs associated with integrating, staffing, implementing, and supporting such programs are still high. Thus, as “Jenks Healthcare Business Report” notes, when it comes to online DM, a key question remains: If you build it, will they come?