Key Takeaways:

• Humana and Walgreens jointly announced a partnership for Human to operate senior-focused primary care clinics in Walgreens stores.
• This comes as a response to a clear industry need for new “front doors to care” and other investments in retail health by competitors to both companies.
• We predict these sorts of deals and services will expand in number and into other regions with these and other companies in response to unsustainable healthcare spending.

Medicare Advantage (MA) continues to show the most robust growth of any line of business for health insurers. Overall MA growth was 7.8% year over year in July 2018, reaching 21.4 million, while Part D enrollment grew to 25.5 million. To better serve these members, health insurers are considering several strategies – one of which is operating primary care clinics that exclusively focus on Medicare patients.

Overview

On June 19, Humana (NYSE: HUM) and Walgreens (NASDAQ: WBA) jointly announced a partnership under which Humana will initially operate two senior-focused primary care clinics inside Walgreens retail stores in the Kansas City, Missouri area. The clinics will open under Humana’s Partners in Primary Care banner; they will join four existing Kansas City area clinics, opened in 2017, which share the same name. The two co-located clinics are slated to open in the fall and occupy ~2,500 square feet (~25% of an average Walgreens store).

These clinics will have their own separate entrance, with an exit into the Walgreen’s pharmacy. While the companies are not sharing details on the nature or economics of the partnerships, Humana did note that it will operate the clinics and staff the doctors and accept a variety of Medicare coverage, including fee-for-service, MA, and Medicare Supplement plans. The clinics will serve seniors exclusively; Humana expects they could take 3-4 years to reach capacity. The companies noted that the collaboration could expand into other markets over time.

This partnership shows how both Humana and Walgreens are focusing more heavily on their longer-term clinical strategy and responding to other competitors “front door to care” strategies.

Outlook: Humana

For Humana, this pilot is a logical extension of the company’s longstanding commitment to an integrated care model that more closely aligns primary care, pharmacy, in-person health plan support, and other services for Humana’s MA and Part D members. It also follows recently acquired minority/joint venture stakes in home health and hospice providers Kindred and Curo.

Humana believes the convenience of the retail pharmacy model should help make primary care more accessible to seniors. In addition to the co-located Partners in Primary Care clinics, Humana representatives will work in select other Walgreens stores to provide general assistance on health-related services to Humana Medicare members and other customers. These in-store “health navigation” services will be available at no cost to members inside the Walgreens pharmacy store (as opposed to the co-located clinic).

The Partners in Primary Care model offers integrated services that “go beyond addressing acute and immediate health issues, and [focus] on developing long-term relationships with patients living with chronic conditions.” In addition to the four wholly owned, standalone clinics that opened in Kansas City in 2017, Humana operates two clinics under the Partners in Primary Care banner in Greenville, SC and another in Gastonia, NC.

All of these providers are risk-bearing for Humana, as will be the locations co-located with Walgreens; the latter may or may not bear risk with other payers, depending on the contracts struck with third parties. Importantly, the collaboration with Walgreens does not preclude Humana from striking any other potential arrangements with other retailers. Humana will also continue to work with Walmart on a partnership that encompasses a value-oriented, co-branded Medicare Part D plan as well as other in-store consultative efforts.

Outlook: Walgreens

Walgreens has recognized the need to make changes to its store format and is exploring various partnerships that will add new services. This announcement with Humana appears consistent with a strategy of incremental, capital-light partnerships with other healthcare services providers to convert its stores away from retail toward a more comprehensive healthcare offering.

Others within the healthcare continuum have received more attention for their efforts to provide a more convenient location to access healthcare services – namely CVS Health with its acquisition of Aetna. But Walgreens has been actively growing its suite of healthcare services that can be offered both inside and outside the retail pharmacy: Partners in Primary Care with Humana, MedExpress with UnitedHealthcare, LabCorp PSCs, Walgreens Hearing, Walgreens Optical, and its new Find Care Now telehealth service.

In addition, Walgreens is piloting a set of differentiated service offerings in the Gainesville, FL market. These include Walgreens Plus (a subscription-based, in-store savings program with an option for free same-day prescription delivery) as well as an in-store partnership with Sprint for phone purchase and activation.

It appears that any new store concept is very much a work in progress, and Walgreens expects to update investors on its store strategy in about a year. We expect Walgreens to test the “Partners in Primary Care” concept in these two test stores before making a decision to roll it out more broadly, as with its other pilots.

Looking Ahead

We see four key questions about the Humana-Walgreens partnership.

Will patients come?

Humana has stated that it could take 3 to 4 years for the two new clinics to reach capacity. Humana did not provide details on how it will advertise these new clinics to new or existing Humana MA beneficiaries, what types of MA beneficiaries are likely to enroll in these clinics, and how it might convince MA beneficiaries to switch from the long-term relationships they have with their PCPs. These clinics might be a good fit for certain Humana MA beneficiaries (e.g. patients within walking distance of a Walgreens or patients without a regular PCP) – but it would not be surprising to see these clinics struggle to reach capacity unless they hire an existing PCP or two who can bring a large patient panel of MA beneficiaries.

Will it actually bend the cost curve?

Assuming a patient panel of 500 to 700 MA patients per physician at these new clinics, they are likely to only serve 1,500 to 2,000 Medicare patients in addition to the four existing Partners in Care clinics in the Kansas City area. Humana currently supports more than 65,000 MA and Part D prescription drug members in the Kansas City area. Will those few thousand beneficiaries regularly seeking care at Walgreens be enough to decrease hospital admissions and ultimately the medical loss ratio?

How quickly will the model expand?

While Humana has acknowledged that retail could be a powerful distributor of provider capabilities for its MA members, its view that model as still unproven. Humana expects to experiment with smaller, more targeted retail initiatives vs. broader ones, at least in the near term. Walgreens as well appears to be in no rush to rapidly expand this concept either, with its pilot starting at two sites and expected to last at least 12 to 18 months.

Will they build or buy an EHR?

It has not been disclosed if Partners in Primary Care is using a commercially available EHR or choosing to build its own product. Some primary care clinics focused on the MA population, such as One Medical, use a commercially-available EHR (eClinicalWorks). Others such as ChenMed and Iora Health have chosen to build much, if not almost all, of their own IT offerings, including a proprietary EHR. The startups that have built proprietary solutions felt that commercially available EHRs were not well-suited for their patient populations for several reasons (such as insufficient HCC coding and documentation support); as long as they only served the Medicare population, they found they were better off building and maintaining their own EHR.

We expect this type of coordinated care services model for MA beneficiaries to expand to other geographies over time. While this partnership is immaterial to either Walgreens’ or Humana’s financials over the next few years, it shows how both companies are focusing more heavily on their longer-term clinical strategy and responding to other competitors “front door to care” strategy for MA – especially CVS-Aetna and UnitedHealthcare-WellMed.

By now you’ve probably seen the Health Affairs study (and requisite mainstream media coverage) stipulating that retail health clinics actually add to the nation’s healthcare spending by encouraging the use of medical services. The study is not without merit, but it’s worth taking a step back and getting to the root of why retail health has increased utilization and spending.

The study (abstract here), which examined Aetna claims data from 2010 to 2012 in 22 cities, found that 58 percent of retail health clinic use represented new utilization, compared to 42 percent for services that would otherwise occur in urgent care or an emergency department (ED). All told, these visits led to a “modest” healthcare spending increase of $14 per person per year.

The natural conclusion, as study co-author Dr. Ateev Mehrotra of Harvard Medical School told CNBC, is that payers and employers should think twice about covering retail health visits since, on the face of it, they don’t save money. This conclusion may be correct, but it misses the bigger picture.

New utilization isn’t necessarily bad. Some consumers visit the retail clinic and receive a diagnosis of a “cold” when a trip down the over-the-counter cold remedy aisle would do. Others visit the retail clinic only to discover that they should, in fact, go to urgent care, their primary care physician, or even the ED. Yes, such visits constitute waste. However, to deny a consumer who wishes to engage in their care just because that care isn’t occurring in the correct venue is poor service at best and a violation of the Hippocratic Oath at worst. Healthcare needs to accommodate those who actively seek services, not push them away. (Besides, wouldn’t the average physician receiving a referral prefer a diagnosis from a retail health clinic to one from Dr. Google?)

Retail health fills a void. Half of the customers at CVS Health Minute Clinics don’t have a PCP, according to the Washington Post. Forty percent of Walgreens Healthcare Clinic visitors say they would otherwise get care at a more expensive venue or skip care altogether. For these consumers, retail health clinics offer a foot in the door – one that leads to shorter waits, faster answers, and better customer service than a trip to urgent care, the PCP, or the ED.

Retail health is transparent. The healthcare industry has been quick to force consumers to pay more for services but slow to actually tell them what those services cost. Retail clinics, operating in an industry where price transparency is paramount, make pricing readily available at the consumers’ fingertips.. There’s no obfuscation or chargemaster at work.

It’s simple economics. As a good or service becomes less costly and more accessible, people are more likely to be willing to pay for it. As this happens, overall spending on that service increases, even as the cost decreases. (Think about it: When was the last time you changed your own oil or cut your own hair?) And treating common conditions is cheapest at retail clinics, according to Mehrotra’s own research.

Momentum is building. There’s a reason payers and employers are willing to cover retail health (and, for that matter, telehealth). The promise of consumer-driven health is meeting patients where they are – and, despite the billions of dollars spent erecting lavish facilities during the last construction boom, patients are less likely than ever before to be in ambulatory care let alone an acute care facility, regardless of the beauty of the edifice. Retail health visits topped 10 million in 2015, and the number of retail clinics topped 2,000. As patients face a heavier burden for the cost of their care, these numbers will only rise.

Smart healthcare organizations (HCOs) partner with retail health clinics instead of dismissing them as a costly fad. CVS Health has more than 50 clinical partners, while Advocate Health Care and Providence Health & Services run Walgreens clinics in Chicago and Seattle, respectively. This helps eliminate duplicate services while also steering patients without PCPs or specialists toward physicians within that system. Meanwhile, both retailers are implementing Epic electronic health record (EHR) systems, which will enable retail clinic data to be folded into the one of the most prevalent EHRs in the market today to create a more complete longitudinal patient record.

Overall, Chilmark Research remains bullish on retail health. Traditional healthcare is inefficient, wasteful, inconvenient, cold, and driven by volume. Healthcare organizations (HCOs) excel at high-touch engagement for high-acuity patients, but they treat low-acuity patients – the vast majority of the population, and those increasingly likely to be selective about where they receive care – little better than cattle en route to market. Only about one in four ED visitors is seen within 15 minutes, according to the National Center for Health Statistics. That’s the norm for retail health.

Retail health usage does merit additional scrutiny. After all, the last thing the industry needs is higher healthcare costs (even if $14 per patient amounts to a handful of tongue depressors). However, a prudent strategy for incorporating retail clinics into low-acuity care, personal wellness, and even disease management will relieve overburdened EDs and PCPs, give patients an accessible venue of care, improve patient education and communication, and ultimately drive costs back down. It will take effort, but the potential impact of retail health cannot be ignored or dismissed, nor should it be perceived as adding to the total costs of care delivered to any given population. That is a conclusion that has no merit, going against the grain of improving the health of a community and one of the primary tenants of the triple aim – removing disparities to accessing care.

The Walgreens PR team has been busy of late, announcing a spate of partnerships that aim to transform them from a brick-and-mortar retail pharmacy into a digital one-stop shop for health care consumers. Specifically, three press releases in recent weeks have revealed a strategy that aims to leverage the 82 million “Balance Rewards” members by trading them store loyalty points for using various features from an expanding in-app menu.

First, Walgreens and WebMD have been collaborating for months on a partnership that brings WebMD tools (namely an online goal-setting/care coaching program) to the Walgreens website, and introduces Balance Rewards-based incentives for users of the WebMD app who are tracking fitness, nutrition, or other health data. It also introduces a refill feature to the WebMD app, so that users can order a refill or change pickup location after scanning the bar code on their empty Rx.

Second, Walgreens is working with Qualcomm in a similar fashion to link the usage of a specific set of devices (so far, two blood pressure cuffs and a blood glucose monitor) to members’ Balance Rewards account. This partnership was unveiled at the Health2.0 conference last fall – It will be housed in the Walgreens app at some point in “early 2015.”

Finally, late last year, Walgreens announced they will partner with MDLive, a leading virtual visit supplier, to give patients round-the-clock access to doctors through a smartphone camera-driven visit. This is available to customers in two states today (California and Michigan). Functionality-wise, this represents an expansion of a “pharmacist chat” feature that came out in the Walgreens app last year.

It’s a no-brainer that Walgreens is looking to incent people into coming to their stores. But their strategy to leverage wearables, at-home biometrics, virtual visits, and in-app tools is worth a closer look. The first two announcements above essentially provide people with coupons that they must earn – by monitoring a chronic disease, making progress against a weight loss plan, and so on. The MDLive partnership will likely route any prescriptions through Walgreens pharmacies, while building loyalty to the app and establishing brand credibility in the eyes of the time-pressed, convenience-seeking healthcare consumer.

These deals all appear to be win-wins for the companies involved at first, but real success for the healthcare system will hinge on consumers actually participating. And if we’ve seen one thing in digital health, it’s that if you build it, they’re not guaranteed to come.

More importantly, “success” needs to be defined here. Is more business and brand glad-handing by three publicly traded companies worth celebrating? Measuring outcomes and quantifying the public health impact of an undertaking of this scale will not be easy – nor do any of these three entities really have an obligation or incentive to do so publicly. Will rewards points lure people in to buy discounted soda and candy, or will this function as more of a health savings account (HSA) that only applies to healthcare items in-store?

And speaking of HSA, how will other stakeholders such as employer groups and payers get involved – is there a bigger role that WebMD can/will bring to the table? Walgreens embarked upon a handful of ACO partnerships in the last 18 months – will they be able to use these new mobile tools to add in a new layer of data about consumer preferences and behaviors (and take advantage of a new set of between-visit reimbursements by CMS)? Is there a strategic role for their partnership with Theranos in all of this? Will their partnership with Qualcomm just be another corporate co-branding PR play, as it appears to be today, or will they take a more device-agnostic approach moving forward that really enables their pharmacists to monitor populations, regardless of which device a patient is using?

All in all, while these partnerships need to play out and mature over the next couple of years, Walgreens is taking a bold, app-first step into the age of the digital pharmacy. This comes at an interesting time for the company, as they recently completed their acquisition of Alliance Boots, the European pharmaceutical wholesaler. As a result, Walgreens faces some questions about leadership of the new global corporation, and is in earnest cost-cutting mode. It remains to be seen if these recent announcements are aimed solely at ensuring their investors of a long-term strategy during this merger process. Perhaps their shift to digital-first entry points is aimed at reducing in-store overhead and improving overall operational efficiency for the long-term.

Either way, our take is that Walgreens has obtained a diverse set of pieces to enable them for long term success – but it remains up to them to execute. It’s too early to predict what will happen, but if these pieces align properly, Walgreens will be able to take advantage of the emerging age of the new healthcare consumer, for whom convenience, access, and cost are dominant drivers of utilization and spending.

One thing is for sure – their main competitor, CVS, is taking a no-holds barred approach to the same opportunity – albeit with a slightly different strategy involving deeper clinical services, delivery system partnerships, and of course more investments in their digital presence. For CAS subscribers, this month’s domain monitor explores this emerging consumer trend through a deeper dive on two key forces shaping the new landscape: virtual care and retail care, including a deeper look at what the other 900-lb gorilla of pharmacies, CVS Health, has got planned for the next few years.

Maintaining a tradition among IT analyst firms, following is Chilmark Research’s forecast of Top Trends for 2009.  While there is a significant amount of “crystal ball gazing” in any forecast, 2009 is particularly challenging due to an economy that has yet to stabilize and a new administration and re-invigorated Congress that seeks to “reform healthcare.” Against this backdrop, our predictions reflect and extend what we have seen in 2008, our continuing research, and conversations with numerous stakeholders in the healthcare sector.  As always, we welcome your feedback, via comments on what you foresee in 2009 as well.

Without further adieu our Top Ten are:

Healthcare Not Immune to Economic Woes: Declines in investment returns and philanthropic giving coupled rising bad debt, fewer consumer/patient visits (delay care) and increase in charity care will wreck havoc on an industry sector that is accustomed to being immune to economic downturns. As it pertains to healthcare IT (HIT) spending in 2009 will be way down as healthcare providers look to control costs.  Providers will go into maintenance mode simply maintaining the systems they now have in place. IT projects at least 50% of the way towards completion will see continued funding, if they can see light at the end of the tunnel and ROI will be quickly realized.  All other projects will be curtailed, delayed or killed.  Some bright spots in all this doom and gloom; apps that focus on eligibility checking, revenue cycle management and more progressive cloud-based offerings (e.g., HIE with hosted EMR) will see reasonable growth in the 8-12% range.

Health 2.0 Companies Shrivel on the Vine: As consumers take on more responsibility for healthcare costs and seek low cost alternatives, use of the Internet as a virtual doctor/adviser will increase.  Despite this increase, most Health 2.0 companies fortunes will evaporate for three simple reasons:

1. Not enough competitive differentiation. There are far too many “me too” apps in market today.
2. Access to additional funding and exit strategies have evaporated. Reliance on advertising revenue will only sustain “Big” Brands as Internet advertising contracts.
3. Poor go-to-market strategies including; lack of partners, ill-defined value proposition and poor positioning.

Those Health 2.0 companies that address all three concurrently and successfully are the ones to watch – ignore the rest.

Retail Health Clinics Gain Traction, Corporate Clinics Stall: Budget-constrained consumers seeking lower cost alternatives, and payers encouraging such practices, will increasingly turn to retail clinics for much of their healthcare needs in 2009. This will lead to continued growth in use and build-out of retail clinics across the country.  Despite their potential savings, corporate clinics are a long-term investment. Corporate clinic providers such as the two Walgreens acquired in 2008, (i-Trax and Whole Health) will see growth stall as employers layoff employees and pursue shorter-term cost cutting strategies.

Virtual Visits – A Mixed Bag: Related to Health 2.0 is the proliferation of Internet-based third party healthcare service offerings, (e.g. American Well) which bring together technology, streaming video and an ability to access a doctor over the Web 24/7.  Problem is, healthcare is based on trust and as inherently social creatures, humans base trust on direct, in-person interactions.  Thus, third party virtual visits will struggle.  This will not be the case for eVisits with a consumer’s existing physician/care team where a relationship already exists.  eVisit reimbursements are now becoming commonplace and consumers will increasingly use such services due to convenience and lower costs.

Dossia Ramps-up: Over two years in the making and a couple of stumbles along the way, Dossia was finally launched in late 2008 with roll-out to consortium member Wal-Mart employees (actually, WebMD roll-out with WebMD sitting on top of Dossia stack).  Earlier this month Dossia announced its second PHR partner, Medikeeper.  While Dossia’s ecosystem of partner apps is dwarfed by Google Health (GHealth) and Microsoft’s HealthVault, Dossia brings something to the table that the other two platform providers do not, some 8M+ potential users (employees). Expect at least three more of the consortium’s eight members to begin rolling out the solution, via PHR vendor, to their employees.  We are placing our bets on Pitney-Bowes, AT&T and Intel to go live in 2009.

Chicken & Egg Scenario Plays-out for GHealth and HealthVault: As Google Health and Microsoft look to add more partners, in particular data providers such as pharmacies (GHealth) or payers (HealthVault) the big question remains: Will consumers begin actively storing their health data on these sites and subsequently engage any of the numerous apps that sit on top of these repositories?  Right now it is a very mixed message.  Today, traffic and subsequently use of either platform remains lackluster.  Early reports are that GHealth is generating some decent consumer traffic (click-thrus) for partners.  HealthVault, however, is generating very little traffic for its partners, but has created better visibility for these partners among larger corporate entities (e.g., payers, employers, providers, etc.).

Over the course of 2009 expect Google to become slightly more aggressive, first with biometrics, second with support for other standards and third attracting new partners, especially data owners.  This last point is contingent on additional standards support. HealthVault will couple its aggressive actions to bring more data providers (payers & providers) and software partners into the ecosystem with direct to consumer marketing. HealthVault’s biggest challenge will remain – creating an engaging and easy to use interface for the consumer.

New HIE Models Leveraging Cloud Computing and SaaS Gain Traction: Chilmark Research recently completed a project for a client that gave us an opportunity to gain an in-depth understanding of the HIE/RHIO market.  What is clear is that the vast majority of  quasi-public RHIOs still have not figured out a funding model that is sustainable (e.g.,  CalRHIO is one hairy initiative that will be declared DOA in 2009).  Health Information Exchanges (HIEs), that are increasingly receiving funding from payers or are set-up within a given IDN will continue to see reasonable, low-double digit growth.  Those HIEs that prosper will be based on a cloud computing model and offer small physician practices, at little or no cost (sponsored by payer), via SaaS, such services as lightweight EMRs and eRx capabilities. We learned of several such projects, yet to be announced, that will roll-out in 2009.

Continua Compliant Devices Hit Market with Little Impact to Anemic Telehealth Growth: The industry consortium, Continua, recently announced that Continua compliant biometric devices will enter the market in 2009.  Problem though is that Continua compliant devices only alleviate vendor lock-in for one can now mix and match Continua compliant devices from various vendors.  Continua does not address the much broader and seemingly intractable problem of how to incorporate telehealth into the existing workflow of care providers and even more importantly, reimbursement models for telehealth remains immature.  Until these issues are addressed, 2009 will not see a major boost in the sales of biometric devices.

Dreams of Big Fed Spending on HIT Do Not Materialize: Despite campaign promises and HIMSS Blueprints, healthcare reform and funding for HIT will not materialize in any meaningful amount in 2009.  Half of the problem will come from continued economic woes in other sectors seeking rescue from federal coffers that will start drying up.  The other half of the problem will result from healthcare reform, in all its many guises, that languishes as Congress over-reaches with its multitudinous approaches and little reconciliation in ’09.  We expect 2010 to hold more promise.

mHealth Continues Expansion, Most Apps Lame: We see tremendous promise for mHealth and honestly believe it will be here that consumers truly engage in health and wellness at a very personal level.  Despite the enormous potential, and a growing number of mHealth apps available for the consumer, we find that the vast majority of these apps are incredibly simplistic and do not fully leverage new smartphone capabilities.  Over the course of 2009 we will see far more apps, particularly those originally developed for the iPhone, being re-purposed for Google’s Android OS, the BlackBerry OS and in Europe, for Nokia’s Symbian OS.  Some truly novel, excellent apps are expected, but these will by far be in the minority.

That’s “IT” everyone and to a certain extent this list defines our research agenda for 2009.  Stay tuned, it promises to be an extremely interesting year ahead.

One of the nice things about all the writing done over the past year is that one can go back, apply some analytics and see exactly what topics/posts were popular over the past year.

So, drumroll please…

Following are the Top Ten Posts at Chilmark Research for 2008 with brief commentary:

10) Zagat Physician Rating Goes Live:  There are now a plethora of physician rating services with this being but one example.  Unfortunately, this service is restricted to Wellpoint members.  Based on what we’ve seen from most payers in their seeming inability to truly engage consumers/members, doubt this Zagats service is getting much traction.

9) Wal-Mart EMR Mandate Implications: Wal-Mart is a massive presence in any of the markets it enters.  Their decision to chose a single EMR solution for all of their retail clinics reverberated throughout the market.  Now that Wal-Mart is rolling out the Personal Health Platform Dossia among its employees, one can expect eClinicalWorks to be closely tied to Dossia as well.

8 ) Oracle+Cerner=Opportunity: Rumors come, rumors go and some seem to take on a life of their own, resurfacing on a firly regular basis.  The rumor that Oracle will acquire Cerner does have some logic to it, but with the current financial mess, this won’t happen anytime soon.

7) Defining a Functional Model for PHRs or How Many Cooks Does it Take: This post took a critical look at the three functional models: one by HL7, another from the Robert Wood Johnson Foundation’s Project Health Design and the third from the payer organization AHIP.  We’re not too keen on any of these models as it is the market that will define a functional model that delivers value, not academics which predominate the first two groups or one from the payers, which have selfish self-interests at heart.

6) Google Health Goes Live: Post went up the day that Google formally released Google Health to the market.  A belated launch, some eight months after Microsoft released a pre-mature HealthVault.  Google Health will slightly more mature than HealthVault coming out of the gates, as seemingly stalled. See post in the Number 5 spot.

5) HealthVault Surges, Google Health Flounders: After all the anticipation for Google Health and the pending battle royale for mind-share between Microsoft and Google for the hearts and minds of health concious consumers, the battle is turning out to be boring. Google is following its common laissez faire approach to developing its service (very thin on resources being deployed) while Microsoft is investing significantly, and it shows.

4) Mobile Health on the iPhone: Since the launch of the 3G iPhone earlier this year we have seen an incredible number of health & wellness apps showing up on the AppStore, which number well over 400 today.  Recently, Apple redesigned the site to make it easier to see which apps are most popular.  Loads of opportunity remains for those that are creative as most apps are pretty simplistic.

3) eClinicalWorks Tight-lipped on the Wal-Mart Deal: This post followed on the heels of Number 9 above.  eClinicalWorks is one of the EMR darlings for smaller practices which remains a relatively untapped market.

2) Walgreen’s Ups Ante in Retail Health: In March, Walgreen’s made the dual move of acquiring both I-trax and Whole Health Management, two providers of corporate campus health clinics.  What seemed like a good move then, may now be one that they are regretting as employers continue to downsize and trim costs.  If Walgreens would have waited (and they could get the $$$ in this tight credit market) they would have been able to pick up these companies for a song today. Alas, hindsight is always 20-20.

and the Top Post in 2008 was…

1) Google’s Schmidt Outlines Health Platform: We all knew Google was going to release some form of PHR in 2008.  We even saw some early screenshots back in August of 2007 when a few presentation slides slipped into the public domain.  But after those slides, we heard nothing, saw nothing, but knew it was coming.  Thus, when Google’s CEO, Eric Schmidt took the stage as a keynote speaker at HIMSS, we waited in anticipation and Schmidt did not disappoint.

And that dear readers is what YOU, found most interesting at Chilmark Research, that is if we not include the post where we announced te release of our iPHR Market Report Executive Summary.  We were absolutely thrilled with how popular that post was (it far exceeded the number 1 post on Google above) and even more thrilled at all the people who have downloaded this Ex. Summary (nearly 400 downloads for all corners of the globe, at least all continents, withthe exception of Antactica, we’re still waiting for that one to come in.

Thank you all for visiting, reading and commenting. We value your input and hope in return, we have provided some valuable analysis on the market.

Late this afternoon, Google Health Beta officially opened its doors for anyone to sign-up. While I did predict they would go live in the 2nd quarter, I was thinking end of the quarter, not the mid-point. Hat’s off to Google for moving so quickly.

As you know, I am at the TEPR conference trying to gather information and more importantly understand just why this conference is still in existence and more importantly, why it still attracts exhibitors as there is virtually no foot traffic, attendance is low and overall organization, well that is better left unsaid. Let’s just say that there is no WiFi and leave it at that.

But enough of TEPR, Google is the real story here (and far more interesting to tell). Following are some quick impressions and analysis.

What I really like:

Since I have a GMail account, sign-in to a Google Health Account was a breeze. Simply read the disclaimers (Terms of Service and Sharing Agreements), agree to them and you are on your way. – Loved It! And those disclaimers and privacy statement are similar to Microsoft HealthVault’s, forthright and easy to understand.

Out of the box connections with a number of data providers including Beth Israel Deaconess Medical Center, Cleveland Clinic, a lot of medication related services (Walgreens, Medco, Longs Drug, and Rx America). Somewhat surprising that CVS/Caremark link is not about medications, but clinicals from Minute Clinic. Likewise, you don’t get clinicals from Walgreens’ retail clinics, only meds. Odd.

They also provide ability to link to Quest Diagnostics so one can get their lab results imported into their Google Health account.

Google Health also provides an ability to link to a number of third party services, including PHR providers Medem, MyMedicalRecords and NoMoreClipboard (each of these vendors as well as Google Health is profiled in our PHR Market Report, that will be available for purchase later this week – drop an email to: info @ chilmarkresearch.com if interested), advocacy groups such as the American Heart Assoc. and LIVESTRONG.COM, Cleveland Clinic’s second opinion service MyConsult and several other services. Some charge a fee for services while others are free, all stated clearly on the Google Health site (though no actual pricing for services is provided).

The real beauty of both features above is that Google provides clear linkages to partner sites. When you click on those links, from within your Google Health account, you are taken to a secure page (https) on the partner’s site where you are clearly asked to sign-in to begin the authentication process and have your records transfered to your Google Health account, or sign-up for a service.

Unlike the less than stellar launch of Microsoft HealthVault, where you clicked on a partner link only to be sent into God knows where, Google has worked closely with this initial set of partners to make it very clear where you have landed and what to do next. Bravo Google.

The interface is clean, crisp and intuitive. Nothing to clutter the eyes/mind as you navigate around the site. This is so unlike most major PHR providers today who seem compelled to barrage you with a visually noisy website experience.

Working with partner SafeMed, the site provides medication interaction checking for the consumer to assist them with managing multiple medications and minimizing adverse drug events. Google Health is supporting such standards as SNOMED CT & ICD-9 (both used for diagnosis/condition coding), LOINC (lab data), and NDC & RxNorm (both used for medications). Google is also supporting a slightly modified form of the CCR standard (which is quickly becoming the defacto standard for PHRs), that they call CCR/G.

What still needs work:

While they have partnered with a number of pharmacy companies and a couple of providers, that is far from capturing the broader market and really making life easier for the average consumer (i.e., a PHR that can self-populate and stay updated without a lot of consumer feeding). An obvious choice is data from health insurers (payers). Payers, arguably, have the largest trove of consumer health data, data that often includes lab results, medications and treatments. Granted, claims data is not as rich as clinical data, but there are very few practices today with as sophisticated digital clinical record keeping practices as Cleveland Clinic and Beth Israel. Google will have to get payers on board to make this work.

Retail clinics, who most often are already using CCR are an obvious link/partner for Google. CVS’s Minute Clinic is a good start, but where is Walgreens’ own clinics and will Google extend out to those corporate campus clinics that Walgreens just purchased? I really can’t criticize Google for this last point as Walgreens did just acquire these clinics, but would have like to have seen Google at least, in some fashion address the employer market for these solutions.

Missing any place to put advanced directives.

No capabilities yet to assist a consumer in managing their health savings account. Be a nice opportunity for Google and Intuit to partner.

Site would hang-up on me occasionally, but that may be more of a function of this terrible hotel Internet connection, than Google.

Was not all that impressed with the search engine for finding a doctor. When I entered my doctor’s last name and city, got back a number of hits but they were all peripheral – not a single one giving me contact details or for that matter even identifying my doctor. Wasted effort for me.

Lastly, an odd thing happened in testing the link to Quest Diagnostics. When I landed on the Quest site, it requested a PIN to sign-in to begin transfer process. Well, I don’t think I even have a PIN with Quest so I backed out of the site. Yet, later, noticed on the landing page of my Google Health, the Quest banner for finding a Quest location or scheduling an appointment. Really looked more like an advertisement to me as I certainly didn’t request the banner and now have to figure out how to remove it.

Bottom Line:

While I am sure I’ll find other small quibbles regarding Google Health, all in all, it is difficult to find anything really major to dislike about this offering. My biggest gripe would be that it is too thin, both from a tools /functionality provided perspective and partners from which to import data. These are very important issues but they are also issues that Google should be readily able to address in the future if the have the mind to do so.

And is that really, at the end of the day what matters most?

Will Google and Microsoft stick it out and stay in the healthcare market long enough to see the tide change and the apathetic consumer turn into a proactive and engaged healthcare consumer. This sector is fraught with challenges which I have written about before and it is going to take time to address them. Let’s hope for everyone’s sake that these two companies have the patience to stick with it as I really do not see any other companies in the market that have the breadth of resources to make this happen.

The more I look at this market, the more I am convinced that needed change in the healthcare sector will come from the outside via greater direct engagement of the consumer in managing their health. And that will require giving the consumer the tools to do just that. Something which both Google and Microsoft are on track to provide.

Other Resources:

Google Health FAQ

Beth Israel’s CIO’s Impressions (Note: As he was part of Google’s Advisory team, you won’t find a critical, unbiased view).

Yesterday, mega-pharmacy chain Walgreens announced that it will acquire I-trax and Whole Health Management. With this acquisition, Walgreens is moving beyond its recent venture into retail clinics in its stores, to clinics hosted on-site at major employers.

The adjacent figure, which I found in their investors’ presentation, makes it quite clear that Walgreens is moving beyond the pharmacy model in delivering care to the consumer and could well become a major competitor to more traditional care providers such as physician practices, hospitals, etc.

Based on Walgreens’ numbers, it also looks like an attractive market with a lot of upside growth opportunities.

Both I-trax and Whole Health Management have created a wide range of service offerings for the delivery of care and each have an impressive list of clients (in excess of 180) that include BMW, Continental Airlines, Disney, Goldman-Sachs, Nissan and Toyota. Both acquired companies provided very similar on-site health services including primary care, pharmacies, health risk assessments, disease management and wellness coaching.  In acquiring these companies, Walgreens extends the Brand from your neighborhood to your workplace and gets a jump on both CVS and Wal-Mart, who are each still focused on in-store health service offerings.

One of the interesting aspects of the two acquired companies is that when I looked through their respective websites, I did not see any references to digital health records, in particular Personal Health Records (PHRs). Curious as many PHRs in the market today have offerings that include health risk assessments, education, disease management, in short, similar offerings, albeit via the Web, that I-trax an Whole Health are offering.  This got me to thinking about a previous post I did on whether or not WebMD was an acquisition target nd if yes, who potential suitors might be and why. I did get a harsh comment on that post, but maybe “Jake” also missed something. There are a wide range of potential suitors for WebMD, including one of these large retailers.

For example, a company like Walgreens could see a lot of upside by adding WebMD to its stable of offerings for employer clients. WebMD would bring additional employer clients, an Internet-based service that dovetails nicely with existing solutions and another vehicle for branding and marketing. Then again, a company like CVS or Wal-Mart might also benefit. So, add another one to the list of potential buyers for WebMD. Would give these three a medium-high probability of acquiring WebMD as the synergies are certainly there, particularly for Walgreens.