STANFORD GRADUATE SCHOOL OF BUSINESS — For as long as people have been talking about the World Wide Web, they've been talking about telemedicine, or using internet technologies to connect doctors with patients who are in remote areas or confined to their homes. But despite all the talk, little has actually happened in telemedicine. That is one reason we were interested in talking with David J. Wong, a Stanford dermatologist and cofounder and CEO of Direct Dermatology, a telemedicine practice now open for business in California. Dr. Wong was a panelist at the recent Stanford Graduate School of Business’ Healthcare Innovation Summit, sponsored by the school’s Program in Healthcare Innovation. Here are excerpts from the interview:
Stanford GSB: Direct Dermatology is a for-profit company, but its main venture backer is the California Healthcare Foundation, which practices social entrepreneurship by funding businesses that are targeting medically underserved populations. Yet most people don’t think of dermatology as one of the medical issues affecting underserved populations.
David Wong: Actually, there is a shortage of medical dermatologists. We train a relatively small number of dermatologists each year, and many dermatologists are tending to go into cosmetic dermatology — what people think of as Botox and laser procedures — because of the financial incentives. In addition to this shortage of medical dermatologists, there is also a geographic maldistribution; most of those practicing are in urban areas.
This social mission is what drove the founding of Direct Dermatology; many of our first patients were from poorer rural areas in California's Central Valley. But we are also looking to build a scalable business. Our belief is that by doing social entrepreneurship, we will simultaneously create something that will have a return on investment.
What are some of the major dermatological health challenges you deal with?
One of the biggest is melanoma, a cancer that has very few treatments. The best thing we can do is screen early, and that requires medical expertise. Another example is severe psoriasis, a chronic condition that can be very disabling and disfiguring. Direct Dermatology also sees patients with any problem of the skin, hair, and nails.
Who can go online and make a Direct Dermatology appointment?
Currently, we are only in California, because of state licensing requirements. All of our doctors are in California. But we will soon be offering our service in other states.
So how exactly does a Direct Dermatology visit work?
The interaction is asynchronous. It's not a live interactive visit over Web cams. A patient takes a picture of their skin problem, then sends in that picture along with their medical history. And then a dermatologist will review it, and send back a report and any prescriptions that are needed. We have a two-day turnaround. Dermatology is such a visually based specialty that dermatology consultation works well through images.
What’s the cost?
It’s $85. In a big urban area, if you were paying out of pocket, it might be $200-plus.
Has your asynchronous, picture-based approach been tried before?
It's been done in academic environments. And the military has done it with soldiers in the field.
Clearly, you're confident that you can provide good care based on, for example, cell phone pictures.
Obviously, there is a certain basic level of picture quality that we need, including a minimum size and resolution. We also tell patients what kinds of images we need. In most cases, we want a distance photo, as well as a close-up photo of the skin problem. Ultimately, we as physicians have to be sure that the pictures we get are of adequate quality for us to give an accurate diagnosis. Nearly all of the submissions are of sufficient quality, mostly because of the education we do with our patients in advance.
Even though it is telemedicine, you are entering into a doctor-patient relationship that has all of the legal and liability issues involved with a traditional doctor's office. How much of a challenge was that in setting up the business?
There are definitely liability issues you have to deal with, even when you are interacting with a patient remotely. The people who founded Direct Dermatology are all dermatologists. And because of our experience, we know what we can and can't do. We know our limitations. We have to maintain a high level of care. Our reputations, our licenses, all depend on that.
How is the business doing?
We are excited about the way Direct Dermatology is growing. We continue to reach more of the unmet need for dermatology care, especially in rural and underserved areas.
How many daily visits are you getting?
The number of visits continues to grow rapidly. I'd rather not get into specific numbers.
How is customer satisfaction?
We have had extremely positive responses from both patients and primary care providers. Our customers value the better and more convenient access to high-quality care.
How relevant is your work to other medical specialties?
While some specialties will always require some live interaction, nearly every specialty can provide better access, higher quality care and lower cost by integrating telemedicine in some fashion. Dermatology is a great one to start with as a proof of concept, because it is so visually based. But we believe similar concepts can be spread to other specialties.
In ophthalmology, for example, much of the exam is based on images of the retina. Cardiologists are looking at EKGs and echocardiograms. A lot of those types of images you'd have to first acquire at a lab or clinic, and then send them in. That being said, there is a growing number of home consumer appliances that will take your EKG, for example. And consumers will be soon able to send those in directly to their physicians.