Nurseweek: Dot-com Recovery: Consolidation becomes an elixir for the e-health flu

Dot-com recovery
Consolidation becomes an elixir
for the e-health flu

By Curtis Pond
July 11, 2000

Amid market upheaval, the e-health winners will be those companies that combine several different services to create a do-it-all site for visitors.

Illustration: Artville


	You've read the article. Now tell us what you think. Related Sites Sabacare Medscape MedicaLogic PlanetRx.com Healthshop.com Drkoop.com WebMD HealthCentral.com

For any nurse who has wanted to scold a patient for having Mount St. Helens-type blood pressure, take heart – that patient could own stock in an e-health Web site. When tech stocks plummeted in April, e-health sites were forced to tighten their belts.

According to the Industry Standard, a magazine that covers the Internet economy, even the most high profile e-health sites did not escape the effects of the plunge.

Since the downturn, Drkoop.com has dropped 65 employees and MedicaLogic/Medscape has laid off 110 employees. PlanetRx.com and Healthshop.com each have bumped 70 employees, and Healtheon/WebMD’s Nasdaq-traded stock has fallen from a 52-week high of 82 5/8 to 14 9/16 as of July 3.

Due to the upheaval, job security at an e-health site is as secure as a discounted alarm system.

But in the aftermath of dot-com illness, a prescription for relief is emerging that may provide a remedy for stagnant e-health companies.

A March Jupiter Communications report shows the e-health market winners will be those companies that combine several different services to create a do-it-all site for visitors. The services will give users the chance to research diseases, purchase health care products, browse health news and link patients to physicians and insurance companies.

But with consolidation comes the issue of choice: Is there room for many different e-health Web sites for users to choose from, or just enough space for a handful of conglomerates to tap into the $1 trillion health care market?

Survival of the fittest
The answer is similar to electronic natural selection.

"What you will see in e-health is going to be consolidation where there is room for improvement," Healthcentral.com CEO Al Green said. "There will be three or four major players in each segment [of e-health]. To put it this way, I wouldn’t want to be player No.5."

Healthcentral.com is an all-inclusive Web site that offers medical news, a database with more than 4,000 medicines and a drugstore with thousands of prescription and beauty products. The company has maintained a market niche by buying smaller sites to increase its content.

The market stalemate is needed because it will thin out the e-health industry, leaving only those companies that are credible and able to educate, Green said.

MedicaLogic/Medscape chairman Mark Leavitt, MD, Ph.D., said he envisions two or three major brands taking the lead in the e-health industry. MedicaLogic, an electronic medical record service for the Internet, and Medscape, which offers several types of clinical information, recently merged.

"You don’t want 20 players all fighting to be No.1. The consumer will not know who to turn to," Leavitt said. "But that doesn’t preclude the fact that there is a need for smaller specialty sites. They are vital to the e-health ecology."

Nurses, who lack the clout of Wall Street but are nevertheless excited about the future of e-health, are maintaining some of those specialty Web sites.

Betty Jones, MSN, RN, president of Encounter Care Solutions Inc., an e-health company, said she was stunned earlier this year when she looked at e-health companies with market caps in the billions of dollars.

"I thought, ‘What am Imissing?’ Most of them [e-health companies] had no real value to add to the provider or patient," she said. "Today, most of those companies are on their last leg. The real winners for the long term in e-health will have to make a positive difference in the delivery of health care, and redefine the doctor/patient relationship and the nurse/patient relationship."

While e-health companies strive to give patients access to instant health information, they still have to support themselves.

Jupiter predicts that by 2004, 90 percent of online consumer health revenues will be generated by commerce – not advertising – as companies redefine the boundaries of e-health.

But some in health care are concerned that the lines between patient and consumer will become blurred.

"I am very concerned about the linking between e-commerce and consumer health," said Vicky Elfrink, RN. While completing her Duke University residency in nursing informatics, Elfrink created a Web site that helps seniors evaluate the quality of Internet health care information.

Virginia K. Saba, Ph.D., RN, a distinguished scholar-professor of nursing informatics at Georgetown University, also has her own nursing Web site.

"I am not selling anything and most of the health-related Web pages are similar," she said. "Do we always have to sell something to be successful in the marketplace?"

"The solution is to not masquerade advertising as content," Leavitt said.

"I don’t think you need to reinvent ethics for the Internet. The Internet should mirror the medical offline world. It would be wrong to interrupt a nurse/patient encounter with an advertisement. But there is nothing wrong with a user looking at ads once that encounter is over."