VentureBeat

(UPDATED: See below.)

Venture capitalists are throwing scads of money at online health-information startups, figuring that at least one of them might eventually emerge a powerhouse in community-building, health-related search, electronic medical records, or even some combination of the three. Today, the NYT’s Steve Lohr weighs in to argue that the biggest battles in this space might just involve the two familiar names Google and Microsoft.

Of all these opportunities, electronic health records probably have the greatest potential to transform and improve U.S. healthcare, although they’ve so far made little headway in our fragmented medical system. Lohr covered that issue far more thoroughly in this June piece. Here, his Google-Microsoft story is kind of heavy on atmospherics and light on detail, and devotes lots of space high up to the looming clash between online titans, consumer fears about trusting big companies with their health records, and the opportunity created by the slowness of doctors and healthcare providers to adopt electronic records themselves.

When the story does get down to details, however, they’re fairly interesting. Google sees creating, maintaining and providing access to electronic health records as the core of its online health strategy. A prototype of Google Health that Lohr viewed takes a consumer-oriented tack, promising people the ability to control their medical information and to give access to “health care providers, family members or whoever they choose.” Additional pages include:

a “health profile” for medications, conditions and allergies; a personalized “health guide” for suggested treatments, drug interactions and diet and exercise regimens; pages for receiving reminder messages to get prescription refills or visit a doctor; and directories of nearby doctors.

Microsoft, by contrast, seems to be taking its classic technology-first approach. Steve Shihadeh, general manager of Microsoft’s health solutions group, emphasizes the “grand scale” that will be required to handle “data storage, software and networking” necessary to implement a workable electronic-records system, and brags that Microsoft software is already present in hospitals, clinical labs and doctors’ offices and that the most popular electronic-records systems already in place were also built with Microsoft software and programming tools. It’s not clear to me if that’s a boast or a threat, actually, although it’s sure got a familiar Microsoft cadence to it.

Shihadeh adds that Microsoft is building a “broad consumer health platform” and dismisses electronic medical records as “just scratching the surface.” Microsoft’s health effort is due to be launched this fall, while Google’s has apparently been put off until next year.

It’s entirely possible that both giants may fall on their respective faces, of course. Neither has made much headway in health-specific search, an area where companies like Healthline have done well, although the NYT does note a recent Juniper report that found 58 percent of people looking for online health information started with a general search engine like Google.

More to the point, Lohr fails to even raise two important questions. The first is exactly how much control these companies envision handing consumers over their electronic health records. Could, for instance, an individual on the Microsoft service pick up her records and take them to Google? Maybe it’s passé to think of tech giants trying to “lock in” their customers with proprietary formats in this Web 2.0 age, but Microsoft’s seeming inability to stop touting its software ubiquity can’t help but make me wonder what the Redmond giant has in mind. Bear in mind also that competing health-record setups at hospitals and doctors’ offices aren’t particularly compatible with each other, either — another factor that has slowed adoption.

The second question is what, if anything, Google and Microsoft plan to encourage the healthcare system itself to adopt electronic records. Consumers, for instance, might embrace either service — or both — and yet have nowhere to take their nifty new portable records, simply because three-quarters of all doctors don’t use them. Fixing that means finding a way to overcome the financial disincentives most small medical practices face in installing and maintaining electronic-record systems, and that could tax the resources — not to mention the patiences — even of these tech titans.

UPDATE: Google Someone apparently took the occasion of the NYT piece to “preview” some elements of Google Health on the Web. See, for instance, these screenshots and related descriptions at Google Blogoscoped.

Dan Kaplan also has a post on Google’s nascent health initiative up at the main VentureBeat page, although he’s considerably more optimistic about the business opportunities here than I am. Medicine does move a lot more slowly than the tech industry, or you’d have considerably more than 25 percent of doctors’ offices wired for electronic health records already. What’s more, the expansion in healthcare’s share of GDP is almost all slated to come in the cost of treatment and compensation for healthcare workers, with relatively little slated for technology. Tech companies may yet find a way to make money from the healthcare sector, but outside a few niches, the pickings have been pretty slim so far.