Health 2.0 Meets Government Stimulus

Stepping into the recent Health 2.0 conference in Boston, one is startled by the optimism of the presenters and attendees. One would be tempted to ask if they knew what year it was and if they had any recollection of the economic crash they had just barely survived.

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Health 2.0, cousin to Web 2.0, has become energized by Congress' $34 billion commitment to invest in Healthcare Information Technology (HIT). The celebratory mood of the Health 2.0 community is the same as we have witnessed in industries on the verge of rapid growth-and simultaneously very different. Advocates and entrepreneurs make up the community, the healthcare advocates charged up by the first healthcare reform rhetoric and government programs since the Carter administration and the entrepreneurs attracted by the large opportunity a nimble young company can exploit. Both groups are almost indistinguishable in the din of their enthusiasm.

The headlines only reported $19 billion of the $800 billion American Recovery and Reinvestment Act (ARRA) that was designated for HIT, but in fine print the government is committed to spending $34 billion to reimburse doctors and hospitals for HIT investments offset by an anticipated $15 billion savings.

Only 17% of the nation's doctors use HIT according to a recent report in the New England Journal of Medicine, significantly lagging other industries' use of computers and the Internet to reduce cost and improve efficiencies. During the five years beginning in 2011 doctors and hospitals will be reimbursed for their investments in Electronic Health Record "EHR" systems. The efficiencies that have resulted from EHR systems built by large vertically integrated healthcare providers have convinced Congress that significant efficiencies will accrue from the broad use of EHR systems in doctor's offices and hospitals, interconnected into a single secure electronic healthcare system of independent providers.

Google and Microsoft publicly christened and legitimized EHR two years ago when both offered EHRs free to the consumer with Google Health and Microsoft HealthVault. Recently Walmart announced it will sell EHR systems for doctors offices.

Late last month, Allscripts, Cisco, Citrix, Dell, Intel, Intuit, Microsoft, and Nuance Communications announced that they have teamed up as the "EHR Health Alliance" aimed at educating doctors on the many tools available to help set up electronic health records. Soon they will begin associating their brands with healthcare via nationwide roadshows and telephone hotlines. The EHR Health Alliance was created to overcome healthcare industry inertia, but there is much more innovation needed to knit the independent EHR systems into a single, secure electronic EHR system.

Massachusetts Health 2.0 companies lifeIMAGE and MedCommons have more specialized EHR offerings. LifeIMAGE has a definitive business case for eliminating redundant radiological exams by offering doctors and hospitals a service that lets them securely access a patient's radiological images ordered by other medical entities. MedCommons provides secure authorized transport of diagnostic and medical records that are consistently presented to the patient's primary and referral health service providers. The value of both companies is in making the patient's EHR portable and useful to the patient and those providers from whom the patient seeks treatment.