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Digital Medicine

SalickNet shows how the health-care industry, one of the last frontiers of computerization, can put information technology to good use.


For Bettina Kurowski, the memory of her mother's losing battle with breast cancer 15 years ago provided a painful lesson in medical economics. She recalls her anger at doctors who, even after the cancer had spread throughout her mother's body, continued to order up more rounds of chemotherapy. A medical researcher, Kurowski believed the potent, costly treatments were unnecessary--her mother was beyond cure and the side effects only made her remaining days worse.

"With cancer, more care, or more expensive care, is not always the best thing," says Kurowski. "The money that was literally wasted on my mother's chemotherapy might have been given to someone who might really have benefited, where a cure was possible."

The experience helped convince Kurowski to get involved with one of the hottest areas in health care--the effort to develop better guidelines for treating specific diseases and gathering better medical-quality information about those illnesses.

With more stringent treatment guidelines, Kurowski says, doctors are less inclined to order expensive and unnecessary medical services, such as excessive chemotherapy.

Kurowski is director of SalickNet, a unit of Los Angeles-based Salick Health Care, at the forefront of efforts to improve cancer treatment and collect data on the care of patients with the nation's costliest disease.

However, capturing that data requires, among other things, sophisticated information systems. And that's a task at which medicine, for all its high-tech gadgetry, has been glaringly dysfunctional.

For years, the health-care industry has been notoriously inefficient at the task of gathering medical data in a form that can be distributed electronically among insurers, doctors, hospitals and pharmaceutical companies.

And entrepreneurs have only begun to recognize the potential for bringing the information revolution to health care.

In addition to Dr. Bernard Salick, who launched SalickNet, the field has attracted the likes of Silicon Valley entrepreneur Jim Clark, founder of Netscape Communications, the red-hot Internet software firm. Clark recently started a company called Healtheon Corp. to bring online medical information to doctors and other health-care providers.

"There's a huge untapped opportunity out there to invest in [health care] information companies," says Sage Givens, managing partner of Acacia Venture Partners, a San Francisco investment firm specializing in health-care services. "Health care is way behind the rest of industry in automation."

Myriad problems stand in their way. Perhaps the biggest is that a sizable chunk of the data collected in medicine is confined to insurance billing claims. These claims are designed to provide insurers and government purchasers of health-care data about medical costs, not about the care rendered to patients.

"Insurance companies can tell you the total members in their plan, how much they spent for care, but they can't tell you how their patients are actually doing," says Salick, who founded a chain of cancer and dialysis outpatient clinics in 1984, partly out of frustration with the quality of care received by his then-6-year-old daughter after she was stricken with bone cancer.

Dr. Lawrence Piro, director of the Green Cancer Center at San Diego's Scripps Clinic, illustrates the insurance-claims problem with a hypothetical example of a breast cancer patient who complains of chest pain. If the doctor orders an electrocardiogram and it indicates a mild heart attack, the visit would probably be recorded on insurance records as related to the patient's breast cancer because that is her primary illness.

And anyone who has ever tried to collect medical records knows that the information resides in disparate locations--insurance companies' files, doctors' medical charts, hospital records, nursing homes' files and so on.

Not only are many of these records kept on paper--doctors' medical charts, for example--but even computerized records cannot be easily shared because most doctors and hospitals are not electronically linked.

Thus when the Pacific Business Group on Health, a San Francisco employer insurance-purchasing coalition, tried to gather immunization rates at HMOs, it had to hire an outside company to pull more than 30,000 patient files from doctors' office shelves and compile the information manually.

In addition to Healtheon and SalickNet, which is focusing its efforts on cancer and the managed care market, the field includes Value Oncology Services, a Santa Monica-based unit of Value Health Inc., and an oncology services network set up by the City of Hope cancer centers.

SalickNet, founded in 1994, seeks to help HMOs curb costs in cancer treatment while also exploring ways to improve patient care. Last December, London-based drug maker Zeneca Group acquired a 50% stake in SalickNet's parent firm, Salick Health Care, for nearly $200 million.

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