Microsoft, Cisco push paying doctors for online work

In a development that could kick start the adoption of online consultations between physicians and patients, self-insured employers are starting to reimburse for care delivered online.

On Jan. 2, Microsoft Corp., Premera Blue Cross and Virginia Mason Medical Center in Seattle launched an 18-month program under which Microsoft will pay $30 per online consultation between 100 participating Virginia Mason physicians and 5,000 Microsoft employees and their dependents.

Physicians get paid when established patients use a secure-messaging system from California-based Relay Health Corp. The system includes an "interview" in which patients answer questions about their problems, information then used by the physician to determine whether to handle the issue online or schedule an office visit. Physicians would not get paid for e-mail with patients.

And starting in 2007, Cisco Systems Inc., one of Silicon Valley's biggest companies, plans to begin reimbursing doctors for online consultations.

Industry observers are closely watching the Microsoft pilot because, so far, "there hasn't been overwhelming evidence of money being saved or health outcomes improving" from online consultations, said Erika S. Fishman, senior analyst at Manhattan Research, a New York consulting firm. If the pilot produces results showing online consultations are cost-effective, other self-insured employers likely will reimburse for the service, followed by commercial insurers, she predicted.

Most health plans that assume risk don't reimburse for online services because they don't receive a direct benefit from it, Fishman said. For example, when a health plan member initiates an online consultation from his or her workplace, the productivity benefit arising from the employee not taking time off from work to visit a physician flows to the employer, not the plan, Fishman said.

A key reason Redmond, Wash.-based Microsoft is testing online consultations is to determine whether they will lower health care costs.

"We average 3½ physician office visits per enrollee per year, and as I understand it the national average is about half of that," said Tom McPherson, senior benefits manager at Microsoft, which pays 100% of its employees' health care benefits. "So we'd like to see if by using this Web visit there's a reduction in those in-office visits for nonurgent or potentially unnecessary in-office visits."

Based on conversations he's had with doctors around the country whose health plans sponsor online consultations, L. Keith Dipboye, MD, an internist at Virginia Mason, doesn't expect online consultations will have much initial impact on his practice.

Doctors considered to have a high volume of online consultations average only one or two a week, which takes them five to 10 minutes to process, Dr. Dipboye said. "That will just fall or disappear into the noise of things that we do that are similar to what we do now, like answering patients' phone calls and things like that."

In the long run, however, he believes that could change because online consultations are potentially an excellent disease management tool for physicians. "Doctors might be spending an hour of their day just doing e-consults with their patients," Dr. Dipboye estimated. "At the most it has the potential to become 10% of a doctor's day because we're never going to feel entirely comfortable not having a face-to-face visit for many sources of complaints. But as we get more comfortable with the system, both patients and doctors will come to understand what they can do that is legitimate medicine without face-to-face contact."

The AMA, which in 2004 created a Current Procedural Terminology code for online consultations, supports the procedure as long as certain criteria are met. These include physicians and patients having established a relationship before the online consultation, which should be used to address only nonurgent issues, said AMA Secretary Joseph Heyman, MD.

The Microsoft pilot meets those guidelines, McPherson said.

While Microsoft wants to use online consultations to drive down costs, Cisco's motive is to boost usage of online consultations by consumers and physicians, said Jeffrey Rideout, MD, the company's corporate medical director. In 2004, Cisco invested an undisclosed sum in Relay Health, the company Microsoft is using, but that was not a factor in its decision to reimburse for online consultations, he said.

Cisco hasn't decided how much it will reimburse, but it has asked its health plans to take steps to make secure messaging and online consultation services available to Cisco employees in California in 2007. The company won't dump insurers from its lineup if they decline to administer and implement the benefit, "but at the same time if any carrier offered it and one didn't ... that does become potentially a tiebreaker, if you will, as to how we represent the carriers to our employees and I'd assume how the employees would view their options," Dr. Rideout said.

But some say it will take more than that to drive online consultations from the cellar to the penthouse.

For online consultations to be widely adopted by physicians, enough employers, insurers or both must pay for the service, so the potential pool of users would make up a greater percentage of any given doctor's patient panel, said Edward Fotsch, MD, CEO of Medem Inc., which offers online consultation services and is partly owned by the AMA.

At this time, most doctors aren't willing to change how they practice if only a tiny fraction of their patient panel have online consultations as a covered benefit, Dr. Fotsch said.

Dr. Rideout agrees. "The power of these services isn't going to be if ... a few large employers do it as much as if Cigna and United do it all for all their members in a certain geography," he said.