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AOL, CareInsite Align to Streamline Health Care Communication

In a multi-year, multi-million dollar deal America Online Inc. has aligned with CareInsite Inc. to streamline the flow of medical information.

As part of the deal, CareInsite has designated AOL the exclusive provider for network that allows health care providers, insurers, HMOs, covered pharmacies and labs to directly communicate with their patients.

Through the agreement, AOL (AOL) members and participating physicians will be able to better handle information from office visits, providing them with more time to discuss care plans and review treatment options.

CareInsite will provide $30 million in guaranteed payments to AOL. Under a separate agreement, AOL will purchase $10 million of CareInsite stock, with an option to purchase an additional $10 million shares in one year.

Martin J. Wygod, CareInsite chairman, said that the partnership with AOL and CareInsite's access to nearly 200,000 physicians will change forever the way they the heath care industry communicates with patients.

"The need for fast, efficient, organized communication in the healthcare industry runs very deep. There is a direct relationship between the problems affecting healthcare and the lack, until now, of an easy, systematic approach to communication between all of its constituents" Wygod said.

Bob Pittman, AOL chief operating officer, said the union would form an efficient means for AOL members to manage their healthcare.

"This strategic alliance with CareInsite will provide critical new benefits and convenience for AOL members and their families, offering an online gateway of communication for consumers with their providers, HMOs, insurers, labs and covered pharmacies," Pittman said.

Under the agreement, AOL and CareInsite will create co-branded sites that enable AOL members to communicate with their own health care providers, insurers, HMOs, covered pharmacies and labs to better manage their health care.

AOL members will have access to secure, real-time online services that allow them to enroll in health plans, choose their providers online, review insurance claims status, receive benefit explanations and receive plan treatment authorizations.

The companies plant to collaborate in sales and marketing promotions to the health care industry. Both companies also intend to leverage their alliance into cross-promotional opportunities.