- This story was delivered to Business Insider Intelligence Digital Health Pro subscribers earlier this morning.
- To get this story plus others to your inbox each day, hours before they’re published on Business Insider, click here.
Dubbed The Clinic, the joint venture (JV) will combine Cleveland Clinic’s health services with the telehealth expertise of American Well to deliver what the pair call a first-of-its-kind telehealth platform focused on comprehensive, specialty, and high-acuity care — for patients both in the US and internationally.
Real Life. Real News. Real Voices
Help us tell more of the stories that matterBecome a founding member
American Well and Cleveland Clinic are pulling on years of shared history to create The Clinic — and we think the JV has major upsides for both organizations. The pair’s relationship dates back to 2014, when the two signed a deal enabling physicians at Cleveland to use American Well’s telehealth platform for urgent care. Two years later, Cleveland was one of the first to health systems to implement American Well’s enterprise telehealth suite. We think the JV is a natural progression of this history that lends unique benefits to each firm:
- Cleveland Clinic is leveraging telehealth as a long-term revenue strategy. Cleveland Clinic is no doubt aware of the consumer interest swirling around telehealth: Nearly half of US consumers covered by an employer health plan said they’d be willing to supplant in-person care with a virtual doctor’s visit via a telehealth platform — and 62% of those individuals said they’d give up face-to-face care for the ongoing assessment of a physical condition or ailment, per a 2019 PwC report. And alongside its JV announcement, Cleveland Clinic revealed that its annual telehealth visits grew 68% in 2018. Further, the health system projects 50% of all its outpatient visits will be virtual in just five years — which also likely contributed to its long-term positive outlook on telehealth. Having The Clinic as a JV separate from the health system’s core business should also allow Cleveland Clinic to be more aggressive in its telehealth strategy, while broadening its revenue pipeline in the process.
- Meanwhile, the JV gives American Well a chance to steal away market share from rivals like Teladoc. American Well is a rising star in the telehealth space, scoring $290 million in funding from tech giant Phillips last year, and scooping up partnerships with Cisco and electronic health record vendor Epic. However, the field is still mostly dominated by New York-based Teladoc, which controlled an estimated 75% of the market in 2016, per Zacks Equity Research. But virtual care for chronic conditions could be a key differentiating factor for American Well: We know that the company has been exploring how telehealth could be used to better manage care for individuals with chronic conditions, like diabetes, and it’s possible that whatever strategies it’s been working on will find an outlet at The Clinic. And given that chronic health conditions are responsible for over 90% of the US’ more than $3 trillion annual healthcare spend, it’s possible that a virtual care solution could catch the attention of payers interested in cutting down on costly in-person hospital visits.
Want to read more stories like this one? Here’s how to get access:
- Sign up for Digital Health Pro, Business Insider Intelligence’s expert product suite keeping you up-to-date on the people, technologies, trends, and companies shaping the future of healthcare, delivered to your inbox 6x a week. >> Get Started
- Join thousands of top companies worldwide who trust Business Insider Intelligence for their competitive research needs. >> Inquire About Our Enterprise Memberships
- Explore related topics in more depth. >> Visit Our Report Store
- Current subscribers can log in to read the briefing here.
Subscribe to the newsletter news
We hate SPAM and promise to keep your email address safe