America Online and CareInsite Announce Multi-year, Multi-million Dollar Strategic Healthcare Alliance
Business Wire - September 15, 1999 13:31
DULLES, Va. and Elmwood Park, N.J.--(BUSINESS WIRE)-- September 15, 1999--
Co-branded Sites with Several AOL Brands to Provide CareInsite
Content and Services to Streamline Connections among Consumers,
Physicians, HMOs, Insurers and Suppliers
America Online, Inc. (NYSE: AOL) and CareInsite, Inc. (Nasdaq: CARI), America's interactive healthcare network services company, announced today a strategic alliance that will help streamline the flow of information within the healthcare system. The multi-year, multi-million dollar deal will enable the companies to connect CareInsite with the largest online consumer audience in the U.S. and make CareInsite AOL's exclusive provider of the network allowing healthcare providers, insurers, HMOs, covered pharmacies and labs to directly communicate with their patients.
Under the agreement, AOL and CareInsite will create co-branded sites that will enable AOL members to communicate with their own healthcare providers, insurers, HMOs, covered pharmacies and labs to better manage their healthcare. AOL will exclusively offer the CareInsite services to its more than 18 million members as well as to CompuServe members and visitors to AOL's Web-based brands Netscape, AOL.COM, and Digital City.
AOL members will have access to secure, real-time online services that allow them to conveniently select and enroll in health plans, choose their providers online, review claims status, receive explanations of benefits, understand plan policies and procedures and receive plan treatment authorizations.
AOL and CareInsite will also collaborate in sales and marketing to the healthcare industry, and the companies intend to leverage their alliance into cross promotional and shared advertising revenue opportunities.
"The need for fast, efficient, organized communication in the healthcare industry runs very deep. There is a direct relationship between the problems affecting healthcare and the lack, until now, of an easy, systematic approach to communication between all of its constituents," said Martin J. Wygod, Chairman of CareInsite. "AOL is the most trusted brand in interactive services. Their services are member-centric and revolve around maximizing the member experience. We believe the combination of their members and CareInsite's access to nearly 200,000 physicians will provide America's health plans, labs, covered pharmacies and pharmaceutical companies with the means to change forever the way they communicate with their patients."
Bob Pittman, America Online's President and Chief Operating Officer, said, "This strategic alliance with CareInsite will provide critical new benefits and convenience for AOL members and their families, offering an online gateway of communication for consumers with their providers, HMOs, insurers, labs and covered pharmacies. There's nothing more important to people than their healthcare, and these services are centered around our members as patients and geared to provide them with an efficient, trustworthy and informative healthcare experience. This alliance adds features and functionality that enhance AOL's long-term value to our members and further empower them as we make their everyday lives more convenient."
Through the agreement, AOL members and participating physicians will be able to streamline the flow of information before and after office visits, providing them with more time to discuss care plans and review treatment options. The CareInsite services will allow AOL members to investigate claims status inquiries, provide links to covered pharmacies and labs, help them find physicians, schedule appointments and verify eligibility for services with participating health plans. In conjunction with participating pharmacies and clinical laboratories, AOL members will be able to renew expired prescriptions and view lab results.
Under the financial terms of the agreement, CareInsite will provide $30 million in guaranteed payments to AOL. In addition, under a separate agreement, AOL will purchase $10 million of newly issued CareInsite convertible redeemable preferred stock with an option to purchase an additional $10 million of the same security in 12 months.
In addition, CareInsite has signed a contract to integrate iPlanet end-to-end e-commerce solutions by the Sun-Netscape Alliance to ensure the scalability and performance of its network. In addition, the co-branded sites will also use AOL's calendaring and instant messaging tools to enhance overall communications functionality.
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