Building the Medical Internet

The vision of a digital health network faces funding and compatibility challenges.

Mychelle Mowry began working in health care information technology for a small software company in the 1980s. "That was before its time," says Mowry, now vice president for health care with Oracle in Redwood Shores, Calif. It took years before hospitals and doctors offices began adopting systems to store patient information electronically.

Twenty years later, digital health records are coming of age. "Now we're getting front-page headlines," Mowry says. Health care IT could save lives, she says. For example, access to electronic records could help identify trends such as the increased risk of heart attack and stroke associated with the painkiller Vioxx, which was pulled from the market in September.

Activity on the federal stage is one encouraging signal to Mowry and other technology executives. During the third election debate last fall, President Bush highlighted the importance of electronic health records. "One of the reasons why there's still high cost in medicine is because they don't use any information technology," he said. "It's the equivalent of the buggy-and-horse days, compared to other industries here in America."

Health care's paperbound system for storing patient information, prescribing treatments, billing insurance companies and performing other administrative tasks doesn't just lag other American industries, such as banking. It's also the "buggy-and-horse days" compared with health care in Europe. In Sweden and the Netherlands, 90 percent of general practitioners use electronic health records, compared with about 20 percent in the United States, according to the research firm Harris Interactive of Rochester, N.Y.

A number of factors have impeded the modernization of American health records. Cost is one; independent physicians, especially in rural areas, are reluctant to invest in expensive technologies. Another problem is that doctors and hospitals would have to make the investment, while third-party payers, including insurance companies and Medicare and Medicaid, would reap the savings from systems that eliminate unnecessary tests, office visits and days in the hospital. And because the technology is relatively new, some systems fail and physicians' productivity can dip during the initial adjustment period. Privacy is another obstacle; federal regulations for medical privacy are stringent.

Advocates say digital records systems improve health care and cut costs. Doctors can access medical histories and the results of tests faster. Systems can alert physicians to potential conflicts between prescriptions. Rural practitioners can more easily consult with specialists in other parts of the country. Providers can issue bills automatically. Public health specialists can monitor symptoms for outbreaks or biological attacks. And everyone can save time and money on storing, copying, mailing or faxing paper.

Trinity Health, a medical care system in Novi, Mich., with 44,000 full-time employees, is implementing a more than $200 million automation project including 23 hospitals and hundreds of outpatient facilities. Trinity's doctors revised orders 25,000 times over three years, thanks to a system that alerts them to harmful drug side effects. Nurses provide more complete documentation with electronic records and patients get faster treatment, says Mary Trimmer, Trinity's senior vice president for the modernization project.

Bush made upgrading health care information systems a federal priority in April. In an executive order, he called for widespread deployment of electronic medical records by 2014. He also created a position at the Health and Human Services Department to lead the push to digitize health records. In May, HHS Secretary Tommy Thompson picked David Brailer to be the national coordinator for health information technology. Brailer, who has doctorates in medicine and economics, served for 10 years as chairman and CEO of CareScience, a health care IT company in Philadelphia.

In July, Brailer published a plan for developing health IT over 10 years. His vision includes individual electronic health records connected through a nationwide information network-a medical Internet. The report outlines four goals: giving physicians access to electronic health records at the point of care, connecting patient records and health care information on the national network, allowing consumers to access their own records and other health information online, and improving public health monitoring and research.

Making sure systems are interoperable will be a key challenge. Segments of the vast, decentralized American health system already have invested in systems that might be incompatible. The Veterans Affairs Department, for instance, reports that it already has electronic health records in use nationwide. Plans for a new hospital in California don't even include physical space for record storage, a sign that paper medical records are quickly becoming a thing of the past, says Jim Krouse, manager of market analysis at INPUT, a government market analysis firm in Reston, Va.

Brailer's mission includes coordinating health IT among the federal agencies. He is charged with creating incentives for investing in health IT. One idea is to leverage Medicare and Medicaid, the largest purchaser of health care in the world, by paying for quality of care, not just quantity. Brailer's office also is looking into helping the health care industry develop standards for technology products that would reduce the risk of system failures.

Brailer consistently has emphasized his interest in partnerships with the private sector, much to the delight of technology companies. "You do not want the federal government to do this," he said in June at a Washington conference organized by the Center for Health Transformation, a think tank founded by former House Speaker Newt Gingrich. No one knows yet exactly how much a nationwide health network will cost, but some estimates put it at more than $100 billion. (The investment would be more than offset by a 10 percent reduction in costs, according to Thompson, about $140 billion a year.) When Brailer issued a request for information in November, technology companies eagerly got to work.

But companies expecting the government to invest heavily in health care IT might be misguided. Brailer has said all along that most of the spending will come from the private sector. "I'm not sure the government is going to write any check for this," he said at the June conference. And when Congress passed an omnibus spending bill for fiscal 2005 in November, a $50 million budget request for his office was zeroed out. The request wasn't much money in federal terms. It would have been used primarily for seed funding and research. But unless the new Health and Human Services secretary redirects department funds to Brailer's office-which is a strong possibility-Brailer will have to work without a budget.

Some see the cut as a serious setback. "The signal that it sent to the private sector was a question about whether the government is serious about this," says Anne Woodbury, chief health advocate with the Center for Health Transformation. Still, Woodbury says, Brailer's leadership and the government's enormous health care purchasing power give him authority. "The biggest tool that he has is his voice," she says. "When he talks, people listen. Everybody wants to get in to see him and show him their solutions."