President-elect wants to computerize the nation’s health care records in five years. But the plan comes with a hefty price tag, and specialized labor is scarce.

NEW YORK (CNNMoney.com) — President-elect Barack Obama, as part of the effort to revive the economy, has proposed a massive effort to modernize health care by making all health records standardized and electronic.

Here’s the audacious plan: Computerize all health records within five years. The quality of health care for all Americans gets a big boost, and costs decline.

Sounds good. But it won’t be easy.

In fact, many hurdles stand in the way. Only about 8% of the nation’s 5,000 hospitals and 17% of its 800,000 physicians currently use the kind of common computerized record-keeping systems that Obama envisions for the whole nation. And some experts say that serious concerns about patient privacy must be addressed first. Finally, the country suffers a dearth of skilled workers necessary to build and implement the necessary technology.

“The hard part of this is that we can’t just drop a computer on every doctor’s desk,” said Dr. David Brailer, former National Coordinator for Health Information Technology, who served as President Bush’s health information czar from 2004 to 2006. “Getting electronic records up and running is a very technical task.”

It also won’t come cheap. Independent studies from Harvard, RAND and the Commonwealth Fund have shown that such a plan could cost at least $75 billion to $100 billion over the ten years they think the hospitals would need to implement program.

That’s a huge amount of money — since the total cost of the stimulus plan is estimated to cost about $800 billion, the health care initiative would be one of the priciest parts to the plan.

The biggest cost will be paying and training the labor force needed to create the network. Luis Castillo, senior vice president of Siemens Healthcare, a company that designs health care technology, said the laborers will have the extremely difficult task of designing a a system that “thinks like a physician.”

“Doctors cannot spend hours and hours learning a new system,” said Castillo. “It needs to be a ubiquitous, ‘anytime, anywhere’ solution that has easily accessible data in a simple-to-use Web-based application.”

But highly skilled health information technology professionals are as rare as they come, and many IT workers will need to be trained as health technology experts.

Early government estimates showed about 212,000 jobs could be created from this program, but Brailer said there simply aren’t that many Americans who are qualified.

Furthermore, ensuring the privacy of patients’ records in a nationalized computer network will be tricky. There are obvious concerns about hackers and system failures. And new online health record systems, such as Google Health are not currently subject to the Health Insurance Portability and Accountability Act, the national health privacy law.

“HIPAA was never intended for the digital age, because the laws never anticipated the emergence of Web-based records,” said Brailer. “Congress can pass one of numerous policy proposals for change, it’s just a question if they have the will to do that.”

The Obama transition operation declined a request to elaborate on Obama’s proposal. The president-elect said Thursday in a speech on the economy thatthe benefits of a modernized national health record system go beyond just cost savings.

“This will cut waste, eliminate red tape, and reduce the need to repeat expensive medical tests,” said Obama. “It just won’t save billions of dollars and thousands of jobs — it will save lives by reducing the deadly but preventable medical errors that pervade our health care system,” he added.

Still, compared to the $2 trillion a year that the industry spends, the$100 billion experts say it may cost to implement Obama’s planis a drop in the bucket.

“We must reduce waste to become more efficient” said Brailer.

The savings of such a plan could be substantial. Brailer estimates that a fully computerized health record system could save the industry $200 billion to $300 billion a year.

That could ultimately slow the rapid rise of health care premiums, which have cut into Americans’ paychecks. While wages are rising at a rate of around 3% a year, health care costs are growing at about three times that rate.

“Obama’s support for electronic medical records is one of the key efforts of health reform that actually will deliver lower costs for hard-working American families,” said Larry McNeely, a health care advocate at U.S. Public Interest Research Group. “Long-term savings can’t happen unless we have 21st century health information technology.”

Massachusetts has developed a plan to fully computerize records at its 14,000 physicians’ offices by 2012 and its 63 hospitals by 2014. After a pilot program, the state legislature estimates it will cost about $340 million to build the statewide computer system, with a cost of about $2 million per hospital.

“[Obama's] timeframe is very ambitious, but there is a need to be able to track data on patients and talk across providers and health care systems,” said Dr. JudyAnn Bigby, Secretary of Health and Human Services for Massachusetts. “The program will allow for greater patient safety.”

Some say some of the hard work has begun. The Bush administration laid much of the groundwork for the program, leading to several pilot programs in a handful of states, as well as a standardization of medical records.

“The whole structure has already been developed,” said Stephen Schoenbaum, executive director of The Commonwealth Fund’s commission on a high performance health system. “It’s feasible to at least make a lot of progress on this in the next five years.”

[via CNN Money] by David Goldman

After years of suing thousands of people for allegedly stealing music via the Internet, the recording industry is set to drop its legal assault as it searches for more effective ways to combat online music piracy.

The decision represents an abrupt shift of strategy for the industry, which has opened legal proceedings against about 35,000 people since 2003. Critics say the legal offensive ultimately did little to stem the tide of illegally downloaded music. And it created a public-relations disaster for the industry, whose lawsuits targeted, among others, several single mothers, a dead person and a 13-year-old girl.

Instead, the Recording Industry Association of America said it plans to try an approach that relies on the cooperation of Internet-service providers. The trade group said it has hashed out preliminary agreements with major ISPs under which it will send an email to the provider when it finds a provider’s customers making music available online for others to take.

Depending on the agreement, the ISP will either forward the note to customers, or alert customers that they appear to be uploading music illegally, and ask them to stop. If the customers continue the file-sharing, they will get one or two more emails, perhaps accompanied by slower service from the provider. Finally, the ISP may cut off their access altogether.

The RIAA said it has agreements in principle with some ISPs, but declined to say which ones. But ISPs, which are increasingly cutting content deals of their own with entertainment companies, may have more incentive to work with the music labels now than in previous years.

The new approach dispenses with one of the most contentious parts of the lawsuit strategy, which involved filing lawsuits requiring ISPs to disclose the identities of file sharers. Under the new strategy, the RIAA would forward its emails to the ISPs without demanding to know the customers’ identity.

Though the industry group is reserving the right to sue people who are particularly heavy file sharers, or who ignore repeated warnings, it expects its lawsuits to decline to a trickle. The group stopped filing mass lawsuits early this fall.

It isn’t clear that the new strategy will work or how effective the collaboration with the ISPs will be. “There isn’t any silver-bullet anti-piracy solution,” said Eric Garland, president of BigChampagne LLC, a piracy consulting company.

Mr. Garland said he likes the idea of a solution that works more with consumers. In the years since the RIAA began its mass legal action, “It has become abundantly clear that the carrot is far more important than the stick.” Indeed, many in the music industry felt the lawsuits had outlived their usefulness.

“I’d give them credit for stopping what they’ve already been doing because it’s been so destructive,” said Brian Toder, who represents a Minnesota mother involved in a high-profile file-sharing case. But his client isn’t off the hook. The RIAA said it plans to continue with outstanding lawsuits.

Over the summer, New York State Attorney General Andrew Cuomo began brokering an agreement between the recording industry and the ISPs that would address both sides’ piracy concerns. “We wanted to end the litigation,” said Steven Cohen, Mr. Cuomo’s chief of staff. “It’s not helpful.”

As the RIAA worked to cut deals with individual ISPs, Mr. Cuomo’s office started working on a broader plan under which major ISPs would agree to work to prevent illegal file-sharing.

The RIAA believes the new strategy will reach more people, which itself is a deterrent. “Part of the issue with infringement is for people to be aware that their actions are not anonymous,” said Mitch Bainwol, the group’s chairman.

Mr. Bainwol said that while he thought the litigation had been effective in some regards, new methods were now available to the industry. “Over the course of five years, the marketplace has changed,” he said in an interview. Litigation, he said, was successful in raising the public’s awareness that file-sharing is illegal, but now he wants to try a strategy he thinks could prove more successful.

The RIAA says piracy would have been even worse without the lawsuits. Citing data from consulting firm NPD Group Inc., the industry says the percentage of Internet users who download music over the Internet has remained fairly constant, hovering around 19% over the past few years. However, the volume of music files shared over the Internet has grown steadily.

Meanwhile, music sales continue to fall. In 2003, the industry sold 656 million albums. In 2007, the number fell to 500 million CDs and digital albums, plus 844 million paid individual song downloads — hardly enough to make up the decline in album sales.

—Amol Sharma contributed to this article.

[via WSJ Online] by Sarah McBride and Ethan Smith

The notorious urinal that served patrons of the famed New York rock club CBGB for 33 years now sits retired in a basement in Manhattan’s posh SoHo district.

Plucked from the graffiti-covered walls when the club closed in 2006, the urinal is among several CBGB artifacts — such as the gritty “CBGB & OMFUG” awning that hung over 315 Bowery and a phone booth covered with punk-rock band stickers — donated to the Rock and Roll Hall of Fame Annex NYC, which opened its doors last week.

The donation is just one step taken by entrepreneurial group CBGB Holdings LLC to revive the brand and transform it once more into a money-making business — without jeopardizing its counter-culture past.

Last month, the group struck a distribution deal with Bravado, a Universal Music Group company that markets rock-themed merchandise around the world, to help sell millions of CBGB T-shirts. Next summer, the Vans Warped Tour music festival will showcase an interactive CBGB exhibit.

These deals were crafted by two men who believe there’s life after death for the landmark venue: James Blueweiss, a marketer who began advising the club a year before it closed, and Robert Williams, a veteran of the retail music business who helped open HMV stores around the world. The two attracted capital from angel investors and paid $3.5 million for the rights to the CBGB brand in 2008. Their company, CBGB Holdings, owns all intellectual property, domestic and international trademarks, copyrights, video and audio libraries, ongoing apparel business, Web site and physical property of the original club.

Andy Warhol, second from right, and friends stand outside CBGB in 1976. (click for full image)

Hilly Kristal opened CBGB — Country, Bluegrass, Blues — in 1973 and intended it to be New York’s premier venue dedicated to the genre. But with too few acts to occupy its stage, CBGB soon attracted young musicians eager to showcase a new sound. Mr. Kristal added to his marquee “& OMFUG” — “Other Music For Uplifting Gormandizers.” In the years to follow, the Ramones, Television, Patti Smith, B-52′s, Talking Heads, Richard Hell, Debbie Harry of Blondie, Dave Matthews Band, Green Day, Pearl Jam and many others graced the CBGB stage.

“I took Hilly to lunch and said, ‘I’m a salesman. I’m a promoter. I really love your story and I want to help you,” Mr. Blueweiss said of his 2005 pitch to Mr. Kristal. “If you’ll allow me to represent you, I think I can cut some slick deals and give you your pay day after 33 years on the Bowery.’”

Mr. Kristal agreed to work with Mr. Blueweiss, but the club’s future was soon in jeopardy. A dispute arose between CBGB and the Bowery Residents’ Committee, which said the club owed more than $75,000 in back rent. Longtime patrons came to the aid of Mr. Kristal in a fight to save the club. Steven Van Zandt, an actor and E Street Band member organized a petition and a “Save CBGB” rally, but despite the efforts, the club was forced to shut its doors.

“I said, ‘Hilly, sell it to me,’” Mr. Blueweiss said. “I’m passionate about this.”

Mr. Kristal agreed to sell the CBGB to Mr. Blueweiss on the condition that he would remain chairman of the company for three years. The men did not know at the time that complications from lung cancer would keep Mr. Kristal from seeing his club reborn. When Mr. Kristal died in August 2007, just a few months after signing an agreement to sell CBGB, Mr. Blueweiss charged forward with the plan to keep the CBGB legacy alive.

But a new era of CBGB won’t be without challenges. Ownership of CBGB is being disputed by Mr. Kristal’s former wife, Karen. In a lawsuit filed last year in Surrogate’s Court in Manhattan, Mrs. Kristal, 83, claims that she is the rightful owner due to an agreement the Kristals made before they opened CBGB in 1973.

The suit, which names Mr. Kristal’s estate and CBGB Holdings, states that because of legal complications due to a bankruptcy of a previous business, Mr. Kristal listed his wife as the owner of record in order to obtain a liquor license, even though they were already divorced.

In a statement, lawyers for the estate called Mrs. Kristal’s claims on the trademark “specious….CBGB was, and is, synonymous with Hilly Kristal.” CBGB Holdings declined to comment about the suit.

While that dispute plays out in court, CBGB Holdings will be charged with the tough task of keeping the brand relevant to a new generation.

The CBGB exhibit at the Rock and Roll Hall of Fame Annex NYC (click for full image)

“Some amazing pieces of history went down there, and this place deserves to be part of the Rock and Roll Hall of Fame, but how do you take a brand that magically formed and find a way for it to live?” said Julia Beardwood, founder of brand consulting firm Beardwood and Co. “And, is it even right to bring it back from the grave? They have a brand that’s trying to make some money using the CBGB name, but they don’t want to devalue what it stands for.”

The most immediate plans for the CBGB business is an overhaul of the Web site that will include streaming music and videos, social networking components and a forum for fans to add their stories from nights spent at the original club. The site will also promote promising new bands, much like Mr. Kristal did for the Ramones.

Blueweiss said revenue from T-shirt sales is about $6 million a year in Japan alone, but declined to provide total revenue. He said the deal with Bravado should boost overall figures.

Ultimately, CBGB Holding’s dream is to reopen a club. Mr. Williams said discussions are ongoing with properties in New York and Las Vegas, but a new venue won’t be opened for at least 18 months.

“Live music is what CBGB is all about, and ultimately it will be back there, but it has to be done the right way,” Mr. Williams said.

Last week, E Street Band’s Mr. Van Zandt, who lobbied to save the original venue, strolled through the New York Rock and Roll Hall of Fame CBGB exhibit.

“It’s good to keep the history of the club alive,” Van Zandt said. “Hopefully, what they’re doing to help the brand will help do that. We tried to get the mayor and the governor to help save the place and it didn’t work. Rock is a massive part of our identity and it’s good to see people who want to preserve it.”

[via WSJ Small Business] by Ty McMahan