Minn. Web site creates health market
You can buy almost anything online these days, but try shopping the Internet for an MRI, strep throat test or even an annual physical exam and you’ll run into roadblocks.
A new Twin Cities company called Carol is trying to change that with a Web site that gives consumers a ‘care marketplace’ to search for medical services, compare quality and price and make appointments.
Carol joins an effort to transform the U.S. health care system by putting consumers in charge and letting the market do its work.
‘We want to let consumers define value,’ said Tony Miller, Carol’s founder and chief executive officer. ‘We don’t have care competition in the marketplace today.’
The free site, which went live in January, generates revenue from health care providers who become ‘tenants’ on the site. When a consumer sets up an appointment with a clinic or doctor on Carol.com, the provider pays the site a fee.
While limited to about 30 providers in the Twin Cities area at its launch, the company is adding others and plans to serve a second U.S. market sometime this year, Miller said.
Health care experts said Carol will face challenges in getting enough doctors and health plans to participate. But they said it goes farther than previous efforts to use the Web to enhance medical choice, and they praised its ease of use.
Instead of going through a list of doctors or clinics, users tell the site what they’re looking for by clicking on parts of the body.
For instance, if a consumer clicked on ‘entire body,’ then ‘annual exam,’ and chose a routine physical for women age 40-64, the results page would show six different options ranging from $207 to $335. After selecting a number of options, consumers can click ‘compare’ and see exactly what each exam would entail. They can also read a description of the doctor or clinic’s philosophy and link to ratings by MN Community Measurement, a nonprofit that measures health care performance in Minnesota.
Consumers who have insurance can type in plan information to have Carol.com estimate their out-of-pocket cost.
Miller said Carol is sensitive to consumer privacy, allowing people to search the site without registering, and it won’t market to individual consumers even if they do register.
‘The fact that they have a basic set of providers and prices and care packages is very impressive,’ said Greg Scandlen, president of the advocacy group Consumers for Health Care Choices, which lobbies against government regulation of the health care market.
But Dr. Sidney Wolfe, director of Public Citizen’s Health Research Group, said the site is nothing more than advertising, and he hoped it wouldn’t catch on.
‘Among physicians, there’s a belief that health care is too critical … to be left to the usual marketplace,’ he said.
If the site becomes more comprehensive, Carol.com would be most useful to people with high-deductible plans, health savings accounts or those without health insurance, said Elizabeth Boehm, an analyst with Forrester Research (nasdaq: FORR – news – people ) who studies the health care customer’s experience.
She was skeptical of the site’s prospects because many people’s choices are limited by their HMO.
‘(Price is) just not what drives people to make their health care choices,’ Boehm said. ‘The challenge for a site like this is that while conceptually it’s good … the reality is there are only a small group of customers looking for that.’
But Miller said consumers are starting to realize that choosing cheap health care might come back to haunt them in the form of higher premiums or other increased costs. And he thinks there are plenty of people like him who might want different options for care and are willing to pay more out-of-pocket to get what they want.
He said his idea for Carol came in part from his own experience with a heart condition for which he was told he needed surgery. A second professional recommended medication, which Miller, 41, said worked.
‘I had the wherewithal and some of the contacts to help me navigate and find answers in the health care system. Most consumers don’t have that,’ said Miller, a partner in the venture capital firm Lemhi Ventures, which has invested $25 million in Carol.
Park Nicollet Clinic, one of the bigger providers in the Twin Cities with nearly 700 doctors, was one of the first to embrace the Carol idea. Chief executive David Wessner said the clinic was already looking at ways to deliver value to patients and wasn’t afraid to reveal prices.
‘We just think there really is a crisis in value in health care. One of the things that helps us address that crisis is to package high value services and start to be willing to compete on that,’ Wessner said.
Psychiatrist Ronald Groat said Carol is important because it makes health care ‘more visible and transparent to someone who’s looking for help.’
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