American Well Partners with Microsoft, Lands Hawaii Health Plan as First Major Customer

6/19/08Follow @wroush

When I wrote my post yesterday about the launch of American Well, the Boston-based startup that plans to let patients visit with doctors via a multimedia Web interface, I couldn’t tell you the whole story. That post was tied to the company’s formal debut at the AHIP Institute 2008 meeting in San Francisco Wednesday morning–which, truth be told, was a bit of a non-event, considering that executives have been talking with the press for months and that many details of the company’s plans have been up on its website for just as long. Two much more interesting pieces of news about American Well had to wait until today, due to embargoes requested by the partner companies involved in the announcements. Here’s the scoop:

1) American Well has signed up its first major customer. The Hawaii Medical Service Association (HMSA)—the Hawaii franchise of the Blue Cross Blue Shield network and the state’s largest health plan, covering some 710,000 citizens of the island state—says it will make American Well’s online services available to its entire membership starting with the plan’s next open enrollment period in January 2009. The 600,000 Hawaiians who don’t belong to HMSA will also be able to use the American Well system, on a pay-to-play basis.

2) American Well will work with Microsoft to integrate the software giant’s HealthVault health information management service into the American Well interface, and will promote HealthVault as an option to American Well users, starting with members of HMSA. The HealthVault system allows users to collect their personal health information online and share it with authorized users; integrating HealthVault with American Well’s system means, among other things, that caregivers will be able to view information stored in HealthVault accounts during their live sessions with patients.

Together, the two announcements lend substance to American Well’s story. The two-year-old startup boasts well-spoken executives, colorful mockups of its patient-doctor interface, slick Web videos explaining the service, expert public-relations handlers, and lavish 26th-floor offices overlooking the Custom House Tower in Boston’s financial district. But until now, it’s been unclear whether the company’s ambitious plan for an online healthcare marketplace is actually practical.

American Well promises that its service will set up video, instant-messaging, and telephone links between patients who need medical advice urgently and physicians who have time to moonlight on the Web, while handling all of the tedious details of the healthcare process, such as computerized record keeping, claims processing, and malpractice coverage, behind the scenes. On the surface, it sounds like a great idea: virtual house calls from credentialed caregivers with virtually no wait, at far less cost than a traditional office visit. (A 10-minute online session with a physician will cost roughly $45, billed either to the patient’s credit card or directly to their health plan, according to American Well.)

But making such a system work poses several Herculean challenges. The communications technology is the least of it: in the era of Internet dating, features such as webcams, text chat interfaces, and automated telephone systems are old hat. “If we had just wanted to build a system that allows Web chats between consumers and providers, we could have done it in a week,” says Roy Schoenberg, CEO of American Well Systems, the operational side of the venture. (Roy’s brother and co-founder Ido Schoenberg is CEO of American Well Incorporated, the company’s business side. Both brothers are Israeli-born MDs, and privately funded American Well is their third healthcare-industry venture together.) Much more problematic is … Next Page »

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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