Baidu Launches China's 'OpenTable For Medical Care' (Investor's Business Daily)

August 31, 2015


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Baidu (NASDAQ: BIDU), China’s Internet search leader, is in the matchmaking business — connecting patients and doctors, that is.

Some call the company’s physician-patient booking venture “China’s OpenTable,” referring to the popular Priceline Group (NASDAQ: PCLN)-owned online restaurant reservation booking system.

In August, Baidu released a service that lets China’s expanding Internet population make doctors’ appointments online via Baidu’s existing health information portal, (“Jiankang” means “health.”)

Baidu says that the service is needed in a country with growing health needs but limited medical personnel. While free now, the service eventually will charge doctors a small percentage of their consultation fees.

Similar systems are catching on outside of China.

Online doctor booking service DocDoc, launched in 2012, covers Hong Kong, Korea, Malaysia and Singapore.

In the U.S., online doctor appointment scheduling startup ZocDoc has grown in eight years to an estimated valuation of $1.8 billion.

“We’re accustomed to being able to schedule reservations online. Why shouldn’t we expect to be able to schedule some doctor’s appointments online as well?” said Darria Long Gillespie, an assistant professor at the Emory University School of Medicine. She has researched ways to streamline emergency care systems in the U.S.

Since 2009, the Chinese government has expanded its national health coverage. But the nation has just 1.4 physicians per 1,000 people, compared with 2.4 in the U.S. and 2.8 in the U.K., according to the World Health Organization. The number of doctors per 1,000 patients in China actually fell 26% in public hospitals and 16% in private hospitals between 2008 and 2012, according to a Deutsche Bank study.

Add in China’s aging population, the rise of age-related illnesses such as diabetes, and growing Internet use, and this combination of factors is spurring new health technology investments from several deep-pocketed firms.

Last year, China Internet messaging leader Tencent Holdings (OTCPK: TCEHY) led a $100 million funding round for health-care platform, and it took a stake in popular drug information platform

In 2014, China e-commerce leader Alibaba Group (NYSE: BABA) — along with Yunfeng Capital, a private equity firm owned in part by Alibaba Chairman Jack Ma — invested in health-care data firm Citic 21CN, which manages data about pharmaceutical products.

Baidu sees opportunity in boosting its mobile health care offerings as more people in China use their smartphones as gateways to the Internet. Nearly 90% of China’s 668 million Internet users — some 594 million people — used mobile devices to go online in June, up 2% over the past six months, according to a recent government report.

China’s mobile health care market — excluding sales of fitness trackers such as Apple (NASDAQ: AAPL) Watch and Google (NASDAQ: GOOGL) Wear — has jumped 60% to $234.7 million last year from $146.4 million in 2011, according to Marbridge Consulting.

China’s mobile health care market, however, is expected to soar to $2 billion in 2017, Marbridge said.

Eyeing that potential, the health care industry has embraced the mobile Internet as a way to improve efficiency, cut costs and provide more targeted, customized services, Marbridge said.

While there’s no official tally of how many people in China turn to the Internet when researching health issues, Baidu says its research shows that 15% to 20% of its search traffic is medical-related.

That’s why Baidu started Jiankang at its Big Data lab in Silicon Valley, as a painless and easy way to search for medical information.

Development of the effort is led by Wei Fan, faculty director of Baidu’s Big Data Lab. He works in Baidu’s Silicon Valley office.

Getting medical care in China is a hassle for many, and Baidu says that its service can be a solution.

It’s common practice for patients to go to a public hospital or clinic for routine medical problems because of the modest price, according to an online health guide for Americans working in China from U.S. health insurer Cigna (NYSE: CI). But as a result, patients have flooded those centers; think of a U.S. hospital ER on steroids.

“Anyone — including foreigners — can use the public hospitals and clinics in China. Prices are cheap, but you may not get the treatment you are used to in your own country,” Cigna’s information said. “There is no appointment system, so you need to wait in line, pay the basic fee and then pay again for each treatment required.”

The last time Fan went to a hospital for a routine medical checkup, “the whole lobby in the hospital in Beijing was flooded with patients waiting to get an appointment,” he said. “It looked almost like an airport with cancelled flights due to a blizzard.”

At the hospital, Fan said, patients took numbers.

“They just line up in front of the doctor, waiting to be treated next,” he said, adding, “The doctor spends just a couple of minutes with (each) patient.”

Baidu’s product allows people to use everyday language and non-medical terms to describe their symptoms, either by using a computer or by speaking to their cellphone. Based on those symptoms, they’ll get back a list of the most likely conditions, and they can read more about both the conditions and recommended treatments.

Users can also book an appointment with a doctor rather than have to show up in person and wait, Fan said.

The system solves a second issue, he said, that of people being seen by the doctor who’s available rather than the correct specialist for their condition.

“Many people go to a hospital without knowing very clearly which department or specialty they should go to, so many things can be optimized in this process to connect the patient to the right doctor the first time and get their problem solved,” Fan said.

Sometimes, he said, people with health questions resort to posting them in online forums and hoping that a doctor replies. “It’s almost like if I have a question … I pose it on TripAdvisor (NASDAQ: TRIP) and (hope) some good-hearted person will answer that,” he said.

“We have limited doctors available in China,” Fan said. “We cannot expect all the doctors to get online and answer questions. They have to stay in hospitals and treat patients. That’s why some level of automation and intelligence would be extremely helpful to alleviate the workload.”

Consistently matching Jiankang users to the correct doctor or specialist at the allotted appointment time will be “crucial” to the product’s success, said Emory physician Gillespie.

“If patients see that it’s not working, then it’s wasting their time,” she said. “And if a physician has 10 or 20 minutes booked in their schedule, and it’s for someone they cannot treat, then they’re losing money.

“If that happens once or twice, you’ll have both physicians and patients stop using (the service) very quickly.”

Connect with Michele Chandler on Twitter @IBD_MChandler and Facebook.

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