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Technology Stocks : America On-Line (AOL) -- Ignore unavailable to you. Want to Upgrade?

To: Annette who wrote (30828)	9/16/1999 5:10:00 AM
From: puborectalis	Respond to of 41369

AOL To Help Doctors Make House Calls By Eric Auchard NEW YORK (Reuters) - America Online Inc. (NYSE:AOL - news) and online health services provider CareInsite Inc. have agreed to an alliance that promises to allow tens of millions of AOL users to consult doctors and other health care suppliers over the Internet, the companies said Wednesday. In a statement, the two companies said they would jointly develop Web sites that would allow AOL members to communicate with their doctors, insurers, health maintenance organizations, pharmacies and laboratories. The agreement marks one of the broadest efforts to date to use the Internet as a medium for allowing consumers to communicate with their healthcare providers and could help speed the movement of the medical industry online. ''This deal certainly gives consumers some really unique features ... and it does that in a very broad-reaching way,'' Richard Lee, an analyst with online brokerage Wit Capital, said in reaction to news of the deal. Shares of CareInsite shot up $5 after the deal was announced, but turned around mid-afternoon to close at $44.50, down $5.88 on the day in Nasdaq trading. The share price has doubled since CareInsite's initial offering in June. Meanwhile, America Online fell $1.88 to $89.06 on the New York Stock Exchange, as its shares continued to suffer through a late-summer slump. Lee said consumers would benefit from the broad range of information available to them on doctors, ''payers,'' or health insurers and pharmacies. ''Payers desperately want to improve relations with their patient members,'' he said. Dulles, Va.-based America Online said it will offer exclusively the CareInsite services to the more than 18 million members of its flagship AOL Internet services. The deal also covers its two-million-member CompuServe service and visitors to AOL's Web-based Netscape, AOL.COM and Digital City sites. Under the deal, CareInsite guaranteed to pay AOL $30 million. In return, AOL said it would buy $10 million of newly issued CareInsite preferred stock and an option to buy another $10 million of CareInsite preferred within 12 months. The preferred stock is convertible into CareInsite common stock. While industries such as retailing and communications have been rapidly transformed by the rise of the Internet, the healthcare field remained largely immune until recently to potential efficiencies the Web offers. This is due in part to the lack of common standards for computerized healthcare information and a desire by the medical profession to communicate directly with patients, reflecting perhaps an antipathy to automation of such relationships. Wit Capital's Lee said the deal with AOL is a natural extension to individual consumers of CareInsite's primary business focus on providing electronic links between doctors and insurers. For AOL, Lee said the deal marks the latest example of how the world's No. 1 supplier of Internet services is adding features to its network that extend beyond its previous focus on providing communications, commerce and published content. He continues to advise investors to buy CareInsite, noting that the latest deal is bound to raise consumer brand awareness for the company. Wit Capital helped underwrite the company's recent IPO. Lee does not follow America Online directly. Lee said the deal could help raise the profile of the Internet as a means of delivering health services and possibly lead to further partnerships between online health companies and other major Internet networks such as Yahoo! Inc. . But reaction was muted in online health stocks, except for Healtheon Corp. (Nasdaq:HLTH - news), which gained $6.25 to $43.94. AOL and Elmwood Park, N.J.-based CareInsite said they will collaborate on sales and marketing to the healthcare industry and they intend to use their alliance to cultivate cross- promotional and shared advertising revenue. The companies said that, through the deal, 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. CareInsite services will help AOL members investigate the status of insurance claims, provide links to certain pharmacies and labs, help them find physicians, schedule appointments and verify services eligibility with health plans. In addition, AOL members will be able to renew expired prescriptions and view lab results in conjunction with participating pharmacies and clinical laboratories, they said.