Ehealth: Market Potential and Business Strategies

Due to the economic and social priorities afforded health services in the United States, research on new delivery modalities such as the Internet is gaining in popularity. Claims of the Internet's potential range from a promise to revolutionize the fundamental way health care is delivered to a tool for empowering patients through enhanced interaction with providers (Rice, 2001). Even though a great amount of attention has been given to e-health activity, the preponderance of publications to date has focused on the Internet as a source of health information. However important this form of e-health is, this type of service simply does not face the same constraints that must be addressed by those actually delivering health care services or tightly regulated pharmaceutical products. In this paper, we examine e-health by focusing explicitly on the delivery of health care products and services. Our examination of e-health activity is guided by two broad research questions. First, we ask what the potential is for the development of online health care services by examining its potential in major health care service and product sectors. Second, based upon case studies of two online health service firms, we seek to understand the emerging strategies of firms that are attempting to enter the health care market with an entirely online approach. Our examination of current e-health trends, as well as our two case studies, demonstrates the tremendous potential for health-related commercial activity on the Internet. However, our examination of the barriers facing ehealth from the US health system also pointed out the almost insurmountable challenges. We therefore conclude that a “click and mortar” model may perhaps be the optimal strategy for e-health.