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Tech Industry

A bitter pill

The grand ambitions of online health companies have been stymied by offline competition, the New Economy bust, opposition by physicians and daunting technological obstacles.


Online medical industry tries to cheat death

By Sandeep Junnarkar
Staff Writer, CNET
September 26, 2001, 4:00 a.m. PT

Led by Netscape Communications founder Jim Clark, online health companies once promised to revolutionize the way patients, doctors, drug manufacturers and insurance carriers do business.

In the five or so years since, little has changed. The original grand ambitions have been stymied by a wide range of problems that include offline competition, the New Economy bust, opposition by physicians and daunting technological obstacles.

Making matters worse, the entire industry is facing a 2002 government deadline to electronically modernize the way health claims are processed. In the meantime, companies such as WebMD are struggling simply to stay alive.

Technology: A beast untamed
In their rush to make a name for themselves, online companies have underestimated the monumental difficulties of integrating the massively outdated technologies used to run the medical business.

Business: Old-line companies revolt
It took awhile for them to get started, but the health insurance carriers have stunted progress of the dot-com medical companies by joining forces to protect their control of the industry.

Culture: Not what the doctor ordered
Despite their reliance on cutting-edge science, physicians are notorious for their resistance to change--and their refusal to adopt cost- and time-saving business technologies is no exception.


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NY doctors join MedCard System

Doctors shun Web as business tool

Wall Street questions WebMD's AOL deal

Online security key to health care venture

WebMD, News Corp. scrap joint ventures

Insurers concoct a system to ward off WebMD

Analyst reports: Wall Street divided on WebMD's pulse

WebMD to lay off 1,100 workers

Jim Clark's stock purchase boosts Healtheon/WebMD

Editors: Mike Yamamoto, Jon Skillings, Dina Gachman, Jennifer Balderama
Design: Jeff Quan
Production: Mike Markovich