LOL! Hi Tom, betcha you remember healtheon (HLTH). Those were the days when we would buy any stock Kleiner pushed out the door.
I miss those because investing was easy.:)
>>By Bill Berkrot
NEW YORK (Reuters) - When Internet pioneer Jim Clark took his third brainchild public in 1999, he boldly pronounced that Healtheon would fast become the world's biggest company and ''fix the U.S. health-care industry'' in the process.
While he may have helped launch the Internet revolution with Netscape, Clark's grandiose design to gain control of the $1.5 trillion health-care industry via the Internet proved a pipe dream and his former firm, now WebMD (HLTH.O), has yet to show a profit.
''We were probably a little naive in how quickly we expected to inject ourselves into the process ... thinking we could come in and be a bull in a china shop and alter the whole terrain in short order,'' admits ''Kittu'' Kolluri, a key member of Clark's team at both Silicon Graphics and Healtheon.
''That has happened in certain other industries which have been a little more receptive to the injection of technology,'' added Kolluri, who is now reunited with Clark at Mountainview, California-based technology firm Neoteris, with Kolluri as chief executive and Clark a key investor and chairman.
Clark and his Healtheon adventure were prominently featured in the book ''The New New Thing'' by Michael Lewis, author of ''Liar's Poker.''
As Hillary Clinton found in trying to reform U.S. health care as first lady in the early 1990s, Clark was taking on a multiheaded beast that is mightily resistant to ''fixing.''
But the Internet is making inexorable inroads into every facet of the health-care industry, if at a snail's pace compared with Clark's original vision.
''It just doesn't happen in health care; nothing's ever been adopted overnight,'' said Anthony Vendetti, an industry analyst for Gruntal & Co.
''The Internet will fundamentally change the way health care is practiced ... but we're talking a minimal five-year process,'' Vendetti said of the evolutionary rather than revolutionary pace.
Sam Karp, chief information officer of the California HealthCare Foundation, agreed with that assessment.
''We're at least five years out before in a significant way we're going to see all the benefits that the Internet has to offer,'' said Karp, whose organization just launched iHealthBeat (http://www.ihealthbeat.org), a free service aimed at care providers offering the latest information on the Internet's impact in health care.
''We think it has extraordinary potential and the fact that we're through this hype of the dot-com world, and the collapse of it, doesn't mean that many of the benefits that the Internet offers to health care won't be achieved. It's just going to take a lot longer to achieve them,'' Karp said.
Analysts say the jury is still out on WebMD, which under Clark's original Healtheon model was going to position itself as the prime Internet go-between for care providers, patients and insurance companies, eliminating paperwork while making money on each transaction.
''They (WebMD) have a couple of real businesses that they purchased by acquisitions ... but in terms of figuring out how to capitalize on the Internet, they are still struggling to figure out how they're going to do that,'' Vendetti said.
WebMD Chief Executive Martin Wygod said this month he expected the company to show its first profit before one-time charges this year. Shares in the company were trading at about $7.60 last week, compared with a high of $105 in May, 1999, before the technology bubble burst.
Part of the problem for investors and boon to consumers is the plethora of health-care Web sites -- more than 20,000 by some estimates -- many offering free medical advice.
''The rub is there's too much good free information on the Web to make money charging for access to information on the Web,'' Banc of America Securities analyst Patrick Hojlo said.
Kolluri still believes WebMD's name recognition gives it a leg up on the competition and the ability to attract advertising revenue.
''If you are able to establish your credibility in the minds of people you can actually make money off of that,'' he said.
While health-care Web sites try to figure out how to turn profits and make money for investors or risk following those who didn't into cyberspace oblivion, several companies are embracing ''e-health'' technology, creating devices to connect doctors and patients through the Internet or wireless Web.
Minneapolis-based Medtronic (MDT.N), for example, has developed its CareLink patient monitoring system, which gives patients the ability to send data from implanted cardiac devices to doctors from home or work via the Internet.
Others companies are also developing ambulatory monitoring devices that could dramatically reduce office visits or trips to the hospital.
VivoMetics, based in Ventura, California, has developed the LifeShirt, which it hopes will gain FDA approval and hit the U.S. market this year.
The shirt is embedded with sensors that continuously monitor more than 30 vital signs. The data, collected by a small computer in a hip pocket of the shirt, can be transmitted to health-care providers.
Technology such as the LifeShirt, says VivoMetrics President Paul Kennedy, could give people in countries with inferior health-care access to U.S. doctors without expensive overseas trips, or, for example, transform the way clinics deal with sleep disorders by allowing patients to be monitored from their own beds under normal sleeping conditions.
Despite all the innovations, concerns over confidentiality could slow the availability of patient information to doctors or insurance companies accessible on the Internet.
And many longtime doctors remain resistant to spending money on new computer technology or the time to learn to navigate cyberspace. But an inevitable changing of the guard will eventually eliminate that intransigence.
''When we've analyzed (Internet) usage rates for medical residents and medical students compared with older practice-based physicians it's a wide chasm,'' said Amith Viswanathan, a health-care industry analyst and consultant with San Jose, California-based Frost & Sullivan.
''We're seeing usage rates of 85 (percent to) 90 percent with medical students and less than 30 (percent to) 40 percent with private practice doctors. Give it five years, it will clearly be different,'' Viswanathan said.
But it remains to be seen who will figure out how to reap the billions of dollars of which Clark once grandly predicted his former company would seize the lion's share.
Said Gruntal's Vendetti: ''I think we're a long way from determining who's going to be successful, profitable and an eventual winner in this case.''
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