Study: Consumers Willing to Pay Fee, Switch Health Plans for Online Services

Sept. 14,  2000  -- More than a third of e-Health consumers, those who seek health and medical information on the Internet, are willing to pay a monthly fee to manage their benefits online, while 25 percent would actually switch health care plans to do so, according to a study released today by Deloitte Research at the eHealthcare Tour in Chicago. The findings, based on a survey of more than 1,000 U.S. adult Internet users, contradict many industry and analyst perceptions that the business-to-consumer (B2C) health care market has limited growth potential at this stage.

"Contrary to many industry perceptions, there's life in the B2C health care market - provided companies know what consumers are willing to pay for," said Graham Pallett, Principal, Deloitte Consulting, Health Care Practice. "E-Health consumers are willing to pay for real-time convenience and customization services, however, they expect to get their content free of charge. Our data also show that e-Health consumers are not just looking to health plans or hospitals to fulfill their demands. It's an open playing field."

These findings are part of a larger Deloitte Research/Cyber Dialogue study of U.S. Internet users and their impact on the online health care market. This study is the second in a three-part series on health care and the e-Business market. Among the major findings:

• Online interaction with doctors high in demand
  Twenty-five percent of e-Health consumers are willing to pay for physician access and connectivity, and nearly 20 percent are willing to switch health plans to do so. Fifty percent of e-Health consumers say they also want direct access to their doctors rather than going through an intermediary. The research also discusses how leveraging physician-to-consumer connectivity will yield significant opportunities.
• E-Health consumers demand more than content
  The e-Health space is evolving from a focus on content to relevance: while consumers are willing to pay to manage benefits and access their doctors online, they are not willing to pay for basic information, such as physician or hospital report cards from health care organizations' Web sites. Only one in 10, for instance, is willing to pay for hospital report cards.
• Neither incumbents or dot-coms have captured e-Health consumer attention
  With very few exceptions, e-Health consumers say it doesn't matter who provides them with content, convenience or customized services. While pharmaceutical companies spent nearly $2 billion on direct-to-consumer advertising in 1999, findings confirm that incumbents and pure-plays have yet to focus on the true demands of the exploding e-Health population.

"There's life in the B2C health care market, but health care organizations still have much to learn about new economy strategies, such as adopting a customer-centric focus and using e-enabled strategies to integrate services, capture market share and improve customer loyalty," says Pallett. "Patients are being empowered by the readily available resources online, and they expect more from the current health care system. Their loyalty is definitely up for grabs. The question is, will there be any takers?"

Copies of the study, as well as camera-ready graphs and charts, are available by request.

Methodoloy

Winning the Loyalty of the e-Health Consumer: Building an e-Business Roadmap is the second in a three-part research series on the e-Health consumer and their impact on the industry. The analysis was launched in 1999 and has continued throughout 2000 in conjunction with, Cyber Dialogue, a leader in providing market research and Internet, customer relationship management solutions. Data is based on a survey of a nationally representative sample of 1,073 U.S. online adults aged 18 and older. All respondents are members of Cyber Dialogue's database of nearly 90,000 online users.

Phase 1: The Emergence of the e-Health Consumer

Phase 2: Winning the Loyalty of the e-Health Consumer: Building an e-Business Roadmap

Phase 3: Taking the Pulse: Physicians and the Internet, coming soon

About Deloitte Research-Health Care Institute

Deloitte Research-Health Care Institute is a cutting-edge thought leadership group within Deloitte & Touche and Deloitte Consulting. The group provides ongoing research and insight into the critical global and industry specific issues facing the health care industry and its leaders. Comprising both consulting practitioners and dedicated research professionals from around the world, the Institute combines industry experience with academic rigor. Our research identifies and analyses market forces and major strategic, organizational and technical issues that are changing the dynamics of the health care industry.

For more information and a complete list of our publications, please see our Web site at http://www.dc.com/research