LDI Health Policy Seminar Series

Vip Patel, MBA
Chairman of the Board
e-Healthinsurance.com

"From e-Commerce To e-Healthcare: Characteristics of a Thriving Exception"

April 6, 2001, 12:00 p.m.
Colonial Penn Center Auditorium
(3641 Locust Walk)

Summary Biosketch

Summary:
By applying business acumen, technical savvy, and spiritual principles, ehealthinsurance.com has succeeded when many "dot.coms" have failed, according to Vip Patel, its Founder and Chairman. Mr. Patel, a Wharton alumnus, spoke at a noontime seminar at the Leonard Davis Institute of Health Economics on April 6, 2001.

Unlike other e-health ventures that sought to revolutionize the health care industry, ehealthinsurance.com focused on a narrow part of the industry, and built strong partnerships with "old-economy" insurers. It built a technically impressive Web site that adds value by organizing information not readily available in one place. And finally, Mr. Patel noted, he drew upon spiritual principles of humility, patience, and "love your enemy" in a business plan that should allow the privately held company to reach profitability by early next year.

Since its Web site went live in 1998, ehealthinsurance.com has become the nation's largest distributor (broker) of health insurance to individuals and small businesses. "The way we've become the largest is by having a tool-the Internet-with geographic reach that has not been there before. So we're licensed in 50 states, and selling in about 43 states that represent 90 plus per cent of the population," Mr. Patel explained.

Part of the business strategy was to use the Internet to simplify the process of applying for health insurance. The challenge, Mr. Patel said, was to make a complex process "brain-dead simple." Although he admitted that the company has a long way to go before achieving that goal, he cited improvements and innovations that are "several orders of magnitude" better than traditional methods of obtaining insurance. The Web site features a user-friendly interface that helps consumers identify plans suited to their needs and their budgets.

Mr. Patel noted that consumers consider several factors when purchasing insurance, including recognition of the plan, price, availability of doctors, and benefits. To maximize recognition of plans, ehealthinsurance.com tries to list all major insurers in each state. The Web site also includes a provider directory, where consumers can check if their physician participates in the health plan they are considering. Another feature of the Web site allows consumers to easily compare plans. According to Mr. Patel, the site has achieved "price transparency"-the ability to compare apples to apples.

Another unique aspect of the site is that it goes beyond just quoting rates by providing online applications to health plans. With the advent of digital signatures, customers can now complete the application "in one sitting," Mr. Patel noted. In addition, online applications have an error rate of less than 10%, significantly improving upon the 30-40% of applications offline that must be reworked because of missing or incorrect information.

To supplement its online features, ehealthinsurance.com also includes a strong customer service component through an 800 number. The company now employs about 100 licensed agents across 50 states to answer questions and provide advocacy services. "They will escalate an issue if someone's having trouble with their insurance company," Mr. Patel said. This is a "win-win" situation for everyone, Mr. Patel added, because customers gain someone who can go to bat for them, and insurers gain an intermediate step before a customer takes legal action.

The success of ehealthinsurance.com may also have broader implications for reducing the number of uninsured people in the U.S., Mr. Patel said. He reported that more than 40 per cent of applicants through the site were previously uninsured; the reach of the Internet, combined with government action (he supports tax credits), could make health insurance more affordable and accessible for up to half the uninsured population.


Biosketch:
Vip Patel is the Founder and Chairman of eHealthInsurance, America's largest distributor, online or offline, of health insurance to individuals and small businesses. eHealthInsurance markets health insurance from a broad selection of health insurance companies nationwide at the best available prices. Given his passion on helping with the nationís uninsured problem, Mr. Patel is actively promoting various legislative solutions at the Federal, State and local levels.

In his prior role at Healtheon/WebMD, Mr. Patel was responsible for developing current and future Internet services for the health insurance industry. He has an extensive background in high tech product line management at SGI and Hewlett Packard, as well as experience in strategy consulting at Booz, Allen and Hamilton. Mr. Patel holds an MBA from the Wharton Business School and graduated with Distinction from the Stanford University School of Engineering. He also serves on the board/advisory board of NetCustomer(eCRM), FiberYard (Optical switching), TechNet, HIM and JesusInstitute.org.



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