| Managed Care On-Line™: Articles |
Because
issues involving health care and the Internet are top concerns for our readers, Healthplan
recently took the opportunity to speak with Clive Riddle, president and
creator of Managed Care On-Line (MCOL)—the online resource for professionals
involved with managed care.
Healthplan: Clive,
what is your background in health care?
Riddle:
I grew up with health care and managed care. I’m 41 and I’ve been in the
business over 20 years. I paid my way through college working in a county
hospital in a finance position, and then obtained an entry-level job with an HMO
feasibility study near the end of the days of HMO public funding. That led to a
job and a 14-year career with Tenet Healthcare
(then National Medical Enterprises).
Healthplan:
How did you actually become involved with managed care?
Riddle:
My boss at
the hospital was named to head a federally funded HMO feasibility study for a
year, and he asked me to be a research assistant. We were in the same building
as the regional office for Tenet The
Tenet people took a liking to me and offered me a job when the study ended.
They
created an administrative job for me at the local hospital. I had numerous
projects, but I was considered the managed care expert because I had worked on
the HMO study. They put me in
charge of forming a PPO with the local physicians.
A
year and a half later I was promoted to the regional office and retained
administrative responsibility for the local PPO. Then the company made a
decision to expand more proactively into managed care, and since I had the most
“hands-on” managed care experience in the company at the time, I was named
to run their California health plan. We grew the PPO, formed an HMO, and later
added an insurance company as well.
Healthplan: How
did that background prepare you to undertake MCOL?
Riddle:
Well, the
experience of taking a managed care organization from start-up to maturity
certainly is helpful heading up an Internet start-up. In my career, managed care
product knowledge, contacts, and perspectives are key. My personal interest in
computers and the Internet round out my credentials. And
my prior relationships with specific individuals who have been called
upon to help to build MCOL have been critical.
Healthplan: Clive,
did you always know you would go into the health care business?
Riddle:
Some people are blessed with the ability to have a plan for their life from the
time they enter high school or college. I was not one of those people. I entered
college as a music major, played gigs every weekend, and thought someday I’d
be a famous musician.
When
my father lost his job during the middle of college, reality paid me a visit. I
held down two jobs to pay my way through school. One was accounting at a county
hospital.
Healthplan: Why have you remained involved with managed care?
Riddle: I
put 15 years into the endeavor for a variety of reasons. I love to create, and
being involved in managed care from its infancy to maturity allowed for
considerable creativity. I believed—and despite the current backlash still
believe—in managed care. I felt that I was making a positive contribution and
a difference. Loyalty was a factor too. The company I worked for was very good
to me, and I thoroughly enjoyed working with the staff and physicians I was
involved with at our health plan.
Healthplan:
Clive, what was your inspiration for MCOL?
Riddle: While
on a family vacation in 1994, I was changing a flat tire in the Salt Flats of
Utah. The idea of translating an America On-Line for managed care suddenly came
to me.
Healthplan:
How did you go from a flat tire to actually getting MCOL started?
Riddle:
Running a health plan, you couldn’t help but see the tremendous waste and
inefficiency with all the paper and manual entry,
when much of the rest of the world had already gone electronic in a big
way. The potential savings in resources for processing managed care transactions
(claims, eligibility, authorizations, patient records) are huge. While the
opportunity was very obvious, I knew it wasn’t obvious just to me—that major
players with major resources would compete in this space.
Healthplan: Where did you acquire the computer know-how, and why did you go into the knowledge side of the online business?
Riddle:
I’ve been fascinated with personal computers. I was the first person to be
issued a PC at my hospital and region. And, I was an early adopter with online
services, and always saw their potential—not just for consumers, but for
professionals as well. But while I saw the potential for managed care
transactions was huge, I knew the competition for that sector would be equally
huge and well funded.
So, I focused on the knowledge resource sector , where I
personally saw the need as a managed care executive, and felt we could get a
running start without a large number of competitors. It took almost a year to
develop a business plan and get the courage to leave a job and company that I
loved. It helped that I had a longstanding relationship with MCOL’s current
chief information officer, Archie Sanford. Shortly after approaching him, we
co-founded the company.
Healthplan: Where
did this longstanding relationship with MCOL’s CIO Archie Sanford begin?
Riddle:
Archie married my sister over 25 years ago. He has had an outstanding career in
information systems. I persuaded him to leave a very secure and respected
position at Ernest and Julio Gallo Winery to become our chief technical officer.
Healthplan: What
about the rest of your team?
I’ve
known our chief operating officer, Karen Hutcheson, for over 20 years. She was
my HMO chief operating officer, and then she went on to run Kaiser’s network
in our area. Our vice president of research and development, Claire Thayer,
I’ve known for over fifteen years, and she consulted for our HMO on key
management projects over the years. Even such Board members as Henry Loubet,
I’ve known for over a dozen years—from when our health plan subcontracted
with his statewide plan at the time.
I’ve
been fortunate to develop a dot com team built on longstanding relationships.
Given the shared vision, sacrifices, and long hours of working together that are
required, it certainly is a critical factor to success to be surrounded by good
people that work together well as a team.
Healthplan:
So, MCOL has been in business for five years?
Riddle:
Yes, MCOL is five-years-old; however, as an Internet company, perhaps that
should be measured in dog years, making MCOL 35 years old.
Healthplan: Why
is the company based in Modesto, Calif.? It’s not really part of the cyber
revolution.
Riddle:
I realize Modesto isn’t considered part of Silicon Valley, but the beauty of a
dot com company is you can be based anywhere. I was already situated in Modesto,
with longstanding relationships with friends and family, and my wife and
children are happy here.
Healthplan: Can
you describe MCOL for us?
Riddle:
Managed Care On-Line is privately held, with numerous individuals and companies
as shareholders. We serve over 6,000 individual members and hundreds of health
plans and provider organizations. It is a resource for any professional involved
with managed care. It provides daily managed care news, a vast library of
publications and articles, thousands of data files, and numerous tools. Plus, we
offer an e-mail delivery service that includes e-newsletters, weekly data
delivery service, and forum message delivery service.
Healthplan: Who
are your customers?
Riddle:
Anyone with a professional involvement with managed care, including health
plans, provider organizations, pharmaceutical companies, employers, government,
and vendors to the industry.
Healthplan: Do
you service all levels of people within the managed care environment?
Riddle:
Our customers tend to be in management positions, particularly upper management
from all major functions—or they are physicians and other clinicians. We also
serve numerous entry-level and analytical positions.
Ten percent of our customers are international.
Healthplan: What’s
it like to be part of a start-up dot.com business?
Riddle:
Two words: sleep deprivation. It is a tremendous outlet for creativity—few
boundaries and ongoing change. Lots of networking, relationships, and strategic
partnering. Testing ideas and watching these ideas become successfully adopted
and eagerly embraced by my peers.
Healthplan: Is
MCOL profitable?
Riddle:
Like nearly all Internet start-ups, MCOL is still growing and improving towards
profitability, but as a relatively older Internet company with an established
revenue stream, MCOL's losses pale in comparison with most Internet start-ups.
Healthplan:
Do the difficulties faced by
DrKoop.com and Healtheon/WebMD and other promising Internet start-ups
give you pause? If not, why not?
Riddle:
The truth is, by definition there's a long-term "going concern" issue
with many start-ups in any infantile industry, until the industry and the
individual businesses have an opportunity to develop and mature. There will be a
continued shake up and evolution, and many of dot coms will get acquired, make
major changes or go away.
MCOL's
situation is more unique. We are not a transaction driven model like Healtheon/WebMD.
While we are content driven like Dr Koop, We have a business-to-business
platform, with a multiple revenue source model including recurring subscription
revenue, content licensing revenue, e-commerce revenue, and business e-solution
revenue.
We
also, as a smaller private firm, have to be leaner and meaner and innovative to
survive, and don't have the luxury of tens or hundreds of millions to burn
through in marketing dollars, which in my opinion is sometimes sadly wasted and
misspent by some dot coms. Also, being private allows us the luxury of not
having to focus our activities only on short-term quarterly results.
Healthplan:
How has the dot.com business changed during the past five years?
Riddle:
It changes every day. It continues to change. “Moving target” doesn’t
begin to describe it. The popularity of e-mail services for professionals has
really grown. The mainstream acceptance of Internet usage by professionals as a
primary medium has finally caught hold. Five years ago we served early adopters.
The technology changes have allowed for much more robust delivery of content.
Healthplan: What
lessons have you learned over the past five years?
Riddle:
You learn from your mistakes so we’ve learned a lot! Fortunately we made ours
early on, without benefit of a venture-funded marketing budget. We relied too
much on software initially, when the market was moving towards the Web. It took
us time to learn who our customers were, and what they really wanted. We learned
the value of strategic partnerships with the right organizations. We learned the
importance of providing a high level of customer service, and interacting with
our members on an ongoing basis. We learned the value of enhancing Web services
with e-mail services.
Healthplan: What
are MCOL’s plans for the future?
Riddle:
MCOL is moving forward from serving its well-established professional niche and
using its existing platform as a base to significantly expand its business
e-solutions, plus launch an employer and consumer portal called eBenefitLand.com.
Healthplan: What
is eBenefitLand.com?
Riddle:
It is the portal for choosing and using health and other related benefits.
EBenefitLand provides employers and consumers answers and tools for their
benefit problems, questions, and needs. Visitors to the site will use
eBenefitLand to assist them in comparing and selecting plans, dealing with plan
service problems, researching benefit information, finding plan websites,
providers, formularies and more. A unique tool, HealthPlanCalc, will allow
consumers to estimate their annual out-of-pocket costs for any health plan after
inputting some basic plan and personal health information.
Healthplan: You
have been credited with coining the term Defined Care. What is that?
Riddle:
Defined Care describes a model environment for defined contributions, as well as
the changes in consumer, employer, plan, and provider behavior under that
system. With Defined Care, the consumer becomes the focal point, and is much
more empowered and engaged. Somewhat like 401(k) plans; employers will fix an
allowance, a defined contribution, that employees spend on a wide menu of
benefit options administered by a third party or the employer directly. We have
opened a new public website, www.definedcare.com,
which is dedicated to providing information on this issue.
Healthplan:What
role does managed care play under Defined Care?
Riddle:
Managed care
plans will be offered as Defined Care benefit options, along with traditional
plans, medical savings and spending accounts and other programs. The majority of
employees should continue to elect coverage through managed care plans.
Expect managed care to adapt and change under this new system.
Healthplan: Clive,
What fuels your passion for business success?
Riddle: It may sound like a lofty goal, but I do have a powerful desire to make a difference in people’s lives. Hard work, long hours, bumps in the road, high points, happy customers, some disappointments – for me this is the fabric of a successful business. I have loved watching the seeds of creativity flourish into a tangible and useful business. Watching the talented professionals from the MCOL team use customer feedback to grow MCOL into an organization that continues to exceed our members’ expectations truly energizes me and is a great source of pride and inspiration.
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