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Health Market Potential and Strategies- A Study








General use of the Internet for health points to a great demand for health-related information. For example, almost half the Internet users in 1997 reported looking for health information or support (FIND/SVP, 1997). A survey of 2,000 Internet users estimated that more than 24.8 million people sought online health and medical content in 1998, an increase of 44% from 1997 ("Double Mastectomy," 1999).
E-health web sites have enjoyed growth that has outpaced general Internet use. For example, in 1999, general use of e-health sites grew 176% to almost 11 million (Media Metrix, 2000). According to Newsweek, the Web is currently a source of health or medical information for more than 50 million Americans. Patients and their families do more actual web surfing than investors, students or people who purchase online (Watson, 2001). Data from Forrester Research (Yonish, Ranguelova, Shrier, & Broadben, 2001) indicates that women are twice as likely as men to visit health sites. In addition, Internet users diagnosed with a serious illness in the past year, whether young or old, visit medical information sites more frequently than their healthier cohorts.

A 1999 study reported in Nature documented more than 15,000 health information Web sites categorized at the prime tier of both the Yahoo and Netscape directories. Yet, health information on the web is not limited to simple non-interactive informational sites. For example, there are many specialized online support groups that offer active mailing lists. Rice (2001) reported that a search on Liszt.com yielded 278 health-related mailing lists. In 1995, the last date individual newsgroup readership figures were provided (Rice, 2001); half of the top 10 Usenet newsgroups were concerned with health topics.

In addition to being a source for health or medical information, the Web is also a site for health-related commercial activity. With respect to online health purchasing behavior, of those who go online three times per week (defined as active Web users), more than 6 percent purchased nonprescription health products, almost 9 percent purchased prescription medications and just under 6 percent bought some type of formal healthcare service (Yonish et al., 2001).




To date, an estimated 2.5 million consumers have actually used a medical practice Web site, but more than 35 million report that they would like to (Guglielmo, 2001). Physicians are hearing this message. Up to 37 percent of all physicians already have some kind of Web presence and a quarter of net-connected physicians use e-mail to communicate with patients (Guglielmo, 2001).


Health commodity items are perhaps the easiest to transition from traditional hard copy catalogs to online publications. Traditionally, health providers must work through a company sales representative or distribution middleman in order to purchase medical equipment and supplies for their clinics or offices.

The web offers an opportunity for staff to shop on the web for everything from hospital beds to bedpans and tongue depressors. This category refers to all items that are tangible and require physical transportation for delivery.

There are two separate sets of potential clients for medical equipment and supplies. The first are industry members. These would include hospitals, doctors' offices, outpatient health centers, home health agencies, nursing homes, and medical laboratories.

Any organization that provides direct or indirect patient services is able to purchase equipment and supplies necessary to supply that care through these web sites. The second set of clients for this category is comprised of the care recipients. This would include the actual patient or a family member or non-professional caretaker of a patient.
There is a host of medical equipment and supplies that are directly purchased by the actual patient such as special functioning beds, wheelchairs, canes, glucose monitors and strips, blood pressure monitors, or bulk items such as wound care dressings and bandages. It appears that the preponderance of e-commerce sites currently being developed are directed at businesses rather than individuals, which is logical given current computer dissemination and utilization trends.


Payers of health services obviously play a pivotal role in the entire health system. Currently, most health insurance companies are utilizing the web for informational purposes. However, some companies are utilizing e-commerce in one of two ways.

First, following the traditional independent agent structure of the insurance system, insurance companies use the Web to enable agents to order policies for their clients electronically. Second, insurance companies are utilizing the Internet to bypass independent agents, and sell health insurance policies directly to the end consumer.
Some sites provide consumers with electronic forms to speed up the process of obtaining health insurance. Other sites go a step further and actually support the online purchase of health insurance.


Consumers use a wide range of prescription and over-the-counter medications for prevention and treatment purposes. Medications include anything traditionally provided in the health section of a supermarket or drug store or products supplied only through a physician's prescription.

E-commerce sites offering medication products are emerging in three distinct forms:
[1] online sales of over-the-counter medications that are delivered directly to the consumer;

[2] ordering of prescription medications on-line that can be picked up by the consumer or delivered directly to the home or office and;
[3] direct marketing with on-line consultation service for a specific product available by prescription only.


The Internet serves as an innovative source for the actual acquisition of medical care and services. The purchasing of medical diagnoses, treatment recommendations, ongoing care management, or a simple second opinion from a licensed health provider falls in this category. These services could be theoretically purchased from a physician, nurse, nurse practitioner, physician assistant, psychologist, social worker, or speech/physical/occupational therapists. Currently, the handful of forays into cybermedicine appears to be coming from a few enterprising physicians who have set up medical practices on the Web.

In these practices, patients log onto the Internet, type in a description of their symptoms accompanied by a credit card number and are then connected to a real doctor who offers a diagnosis as well as a prescription if warranted. This new service is often touted for its potential to solve the issue of access for people who are unable to see a physician in her office due to geographic, economic or time constraints. However, the practice of medicine is a highly regulated business and this modality of service raises a number of perplexing questions ranging from licensure requirements to efficacy of care.

Additionally, there are worries that Internet-based clinical service provision opens the door to increased probability of misrepresentation of health provider credentials, as well as patient attempts to fake illness in order to obtain prescription drugs.

Though health information on the web is obviously popular and an important application, it is not challenged by the many stringent health guidelines and requirements that confront the other categories of e-health firms. Specifically, online pharmacies and clinical providers face the same strict legal and delivery-based barriers that confront traditional health firms.
We will Discuss barriers to all this in my next post.....Cheers!

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