Thursday, April 27, 2006

 

Future of WebMD

Emdeon (Formerly WebMD)

April 17, 2006

Quan M. Nguyen




Current Landscape


Currently within the healthcare sector, much of power resides within the service and healthcare providers. These two providers dictate to employers the service

s offered as well as work with healthcare solutions to provide added value to the back to the payers and hence the patients. The new player within this industry is the web portal, with WebMD being the primary player. WebMD initial goals are to provide information for patients, making it easier for them to make various health decisions.

Changes to the Sector

The Electronic Medical Record has become the new disrupting technology within the healthcare sector. The EMR provides the healthcare industry the ability to have a consolidated data record for each patient. This record would include all health care records from physicians, hospitals, and health insurance providers. This record would change how patients decide on doctors as well as allow providers the ability to analyze data to help reduce health costs. Payers would then be able to change their selection process of health insurance providers.

Future Landcape


The future landscape of the healthcare is dictated by the addition of EMR’s. Currently the providers had much of the power and revenue stream. In the future, the power is shifted towards the payers and patients. This is due to the empowerment of the patient having the EMR as reference to any medical issue that may arise. The patient can now analyze their health care to others as well as examine common health care practices. Payers will now be able to dictate to providers specific performance metrics to providers to ensure that their employees are taken care of health wise. Within the sector, privacy issues arise as well as a need to central data repository to handle this data. Many discussions will take place in who will maintain and secure the EMR. Players such as WebMD have the opportunity to increase their power and revenue share in this future landscape.

WebMD Overview

"WebMD is the leading provider of health information and services to consumers and healthcare professionals. The online healthcare information, decision-support applications and communications services that we provide: -help consumers take an active role in managing their health by providing objective healthcare information and lifestyle information. -make it easier for physicians and healthcare professionals to access clinical reference sources, stay abreast of the latest clinical information, learn about new treatment options, earn continuing medical education credits and communicate with peers. -enable employers and health plans to provide their employees and plan members with access to personalized heath and benefit information and decision support technology that helps them make informed benefit, provider and treatment choices."

WebMD is currently one segment out of the 4 segments integrated into Emdeon. 4 Segments of Emdeon are Emdeon Business Services, Emdeon Practice Services, WebMD Health, and Porex.

Description of Emdeon 4 Segments (From www.emdeon.com)

Emdeon Business Services provides revenue cycle management and clinical communication solutions that enable payers, providers and patients to improve healthcare business processes. Emdeon Practice Services provides physician practice management and electronic health record software and services that increase practice efficiency and enhance patient care.

WebMD Health provides health information services for consumers and physicians through our public online portals, and for employees and health plan members through our private online portals.

Porex is a developer, manufacturer and distributor of proprietary porous plastic products and components used in healthcare, industrial and consumer applications.

Moving away from just being a web company, WebMD changed their name to Emdeon Corporation. This move can be attributed to the move into business and practice services. WebMD is most likely the face of Emdeon to the typical patient in providing health information services. The 2 segments, Business and Practice Services show their willingness to move into additional avenues of revenue. With the increase interest in Electronic Medical Records, Emdeon is attempting to position themselves as one of the major players within the healthcare sector. Recently, WebMD/Emdion created a partnership with Dell in providing Dell employees with Electronic Health Records. This along with their continued exposure with WebMD, Emdeon can become a possible warehouse for all patients, physicians, payers, and providers in terms of the medical record. Although privacy is a major concern, this risk offers a greater reward in terms of Emdeon’s profitability. Emdeon could then compete with consultant companies such as Accenture and IBM Services in terms of supporting the payers and providers in terms of support as well as providing an outlet for the physicians and patients in viewing new medical information and history of care.

Suggestions Moving Forward

I believe that Emdeon must position their WebMD segment to patients and physicians in the fore front. WebMD can be the Google of the healthcare sector. They can then position themselves with providers and payers, pushing the brand awareness of WebMD. By bundling this service with their other core segments, Practice and Business Services, they can combine information between the segments to provide the ultimate warehouse for anyone in the healthcare sector. I believe that the WebMD segment is the key to their success. If patients understand that WebMD is the place to go to find any information about medicine, physicians, and other provider information, I believe that the hospital health systems and other health care players will be more willing to work with WebMD and other Emdeon business segments.

With the push of the electronic medical record in the healthcare sector, Emdeon’s data competency makes them a perfect fit in getting themselves firmly entrenched in the electronic medical record race. Their Business Segments are setup to handle all aspects of the electronic medical record. Initially, Emdeon should work on getting the initial electronic medical record started. They can work with getting patients and providers connected and initial medical information together. This can then allow them to add in the physicians and then the actual medical history from hospital systems and other medical care facilities.

Consequences

The consequences of Emdeon/WebMD failing to taking advantage of the EMR transition in the healthcare sector can be extremely great. Without a added information from their core business, you will see other layers take advantage and strengthen their hold within the healthcare solutions as well as add web solutions to compete with WebMD. The winner in the privacy services layer could also easily take over WebMD’s strength on the web. The web portal layer is already very week in revenue and power compared to the other layers in the health care sector. WebMD can ill advise not working themselves into the EMR competition to grow the Emdeon and WebMD name.


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