NEW YORK -- Faced with a patient with a stubborn headache, a U.S.
doctor can use some of the world's most up-to-date technology to scan
the brain, looking for problems.
The doctor's diagnosis, though, is still likely to be jotted on
paper and filed in a folder, even though companies such as HBO & Co.,
Cerner and Shared Medical Systems offer computer products that makes
it easy to record, store and manipulate patient information.
Computers are a fact of modern life. So is the pressure on the
health care industry to operate more efficiently. Slowly, the
nation's doctors, hospitals and managed care companies are putting
two and two together, analysts said.
"The health care industry in general is still in the dark ages
when it comes to (information) technology," said Todd Richter, an
analyst at Morgan Stanley Dean Witter Discover. "Use of information
technology and application technology is going to separate the
winners from the losers."
Many information service companies do everything from selling
software to building complete computer systems for health care
providers. HBO, the largest, sells Pathways Smart Medical Record,
software that documents patient histories. Another package handles
scheduling of patient appointments. HBO shares have risen about 60
percent in the past 12 months.
Some smaller software companies have hit snags recently. Medirisk
reported profit per share that was more than 80 percent lower than
what analysts were predicting before the company said earlier this
month that problems with software sales would hurt earnings.
Advanced Health anticipates a second quarter loss.
The larger companies have the ability to weather ups and downs,
with their size giving them more chances to cross-sell different
products, produce individual packages more cheaply and offer greater
variety. As health care companies consolidate, they need to buy
larger and more varied software and computer products, analysts said.
"You've got bigger companies with more users," said Sharon Corr, a
Merrill Lynch analyst. "The health care companies are standardizing
themselves on major vendor systems."
The need to keep patient data private has also hampered automation
of health care.
Because of "the big bugaboo of patient confidentiality, people
were less eager to jump into automated medical records," said Annie
Driscoll, a health care consultant at NWB Managed Care Development.
"No one saw the advantage of typing medical records into a system if
they weren't going to be able to use it."
Improvements in security technology, though, are making this less
of a worry. For example, the Brigham and Women's Hospital in Boston
is working to put patient data onto a computer network, easily
accessible from many different locations for those who have all the
A group of doctors, students and computer scientists is working to
put details on the Web, such as where outpatient surgery patients
should go when they arrive at the hospital and descriptions of