Online consultation slow to grow

Since 2002, First Health Group Corp., a Downers Grove, Ill.-based PPO, has stood ready to pay $25 for each online consultation physicians conduct with chronically ill patients.

But the volume of online consultations has been so anemic that the PPO can do nothing but wait for patient and physician demand for the service to materialize.

"Every once in a while somebody uses it," said Scott Smith, MD, the PPO's chief medical officer. "If my career was dependent on this, I'd have been out of business a long time ago."

Physician resistance, concerns about medical and financial privacy, the newness of the service, lack of patient awareness of its availability and patient reluctance to pay a co-pay -- or anything -- are some of the key reasons why online consultations haven't yet taken off, according to several health plans that have been reimbursing for online consultations either on an experimental or non-experimental basis since 2002.

Although recent surveys have found that most consumers want to communicate online with their physician, plans report that they have seen little evidence that patients will use the service heavily at this time.

In March, for example, a survey by JupiterResearch found that a majority of adult Internet users were interested in engaging in online consultations with their physicians but only 3% of them did in 2003.

A key reason is that 92% of consumers are unwilling to pay more than $10 for an online consultation, said Monique Levy, an analyst with the Darien, Conn.-based market research firm.

"What I've learned is that what doctors and patients say they will do in a survey and what they actually do are often times different," said Paul Bluestein, MD, chief medical officer of Connecticare Inc., which stopped reimbursing for online consultations this year after its more than 12-month-long test with ProHealth Physicians, a 180-physician primary care practice, failed to lure member participation. "It is an idea whose time hasn't yet come perhaps," he said.

Like Connecticare, Horizon Blue Cross and Blue Shield of New Jersey's pilot has been plagued by low member adoption. Consequently, the payer expects shortly to stop reimbursing.

Five insurers that continue to pay for online consultations are First Health, Blue Shield of California, BlueCross BlueShield of Tennessee, Anthem Blue Cross Blue Shield in Colorado and Blue Cross and Blue Shield of Massachusetts.

All except First Health are reimbursing on a temporary basis, seeking answers to several questions before deciding whether to offer online reimbursement across all of their business lines. The testing plans want to determine whether physicians and patients will access online service for minor, non-urgent problems; and whether online visits can replace office visits, save money, improve physician and member satisfaction, and help payers retain and attract doctors and members.

Money savings possible

In 2002, a study found that Blue Shield of California could potentially save money by reimbursing for online consultations for PPO members, but the plan is conducting a second test involving HMO members.

Today, there are two models of reimbursement for online consultations. Under one model, health plans directly pay physicians $19 to $25 per online encounter, and patients generally pay an extra $5 to $20, though some insurers don't require a co-pay.

In the other model, patients bear the full cost of the online consultation, which is set by the physician. One way a doctor can offer online consultations is through a secure network operated by a third party such as Medem. The San Francisco-based company, which is partly owned by the AMA, collects payment from patients by credit card and submits a check to the physician, minus a $2.50 fee, each time a physician bills patients for an online consultation.

Medem is open to offering online consultations through deals with insurers but has not gone after that market because most payers don't reimburse for online consultations, said Edward Fotsch, MD, Medem's CEO.

The low volume of online consultations insurers are seeing doesn't surprise Dr. Fotsch. "They simply don't know that the online consultation with their doctor exists," he said.

The lack of promotion by physician offices could be one reason why the New Jersey Blues' pilot has limped along since it was launched in 2003, said Nicholas Bonvicino, MD, the plan's senior medical director.

Online consultation volume also has been low because patients were reluctant to enter their credit card number, he said. They also were reluctant to pay for a service they perceived to be the equivalent of one they would get for free by telephoning their doctor, he said.

Michael Good, MD, a family physician in Middletown, Conn., who tested the service with Connecticare, found that online consultations worked well and helped improve office efficiency.

Although Connecticare doesn't reimburse anymore, ProHealth Physicians continues to offer the online service, charging patients $5 for an online follow-up to an office visit and $35 for non-follow-up visits.

Future growth seen

While online consultation "was never a big hit" as far as volume, he thinks the service eventually will become more popular. "Patients and doctors are learning how to do more transactions online," Dr. Good said. "As more time goes on and the environment matures, people will continue to use online consultations for simple or trivial problems."

Blue Cross and Blue Shield of Florida and Group Health Inc., New York, agree. They believe online consultations are the wave of the future and believe that reimbursing doctors for them will help the insurers retain and attract doctors and physicians. As a result, they recently announced that they will skip tests and phase in reimbursement for Web visits across all their business lines, starting at the end of the year.

"We know that the uptake initially is not going to be huge, but what we want to do is take advantage of that [lull] to make sure the system is tightly integrated with our other systems and well-developed," said Robert Forster, MD, the Florida Blues' chief medical officer.