Health care was so slow to adopt Net technologies that output per worker in the sector fell in the 1990s. Now spending is beginning to rise. Take Hackensack: Since 1998 the New Jersey hospital has spent $72 million to upgrade its tech infrastructure, automate its pharmacy, and roll out electronic medical records.2. SELLING DOCS ON GOING DIGITAL
Doctor resistance is a major hurdle to e-health. To get past this obstacle, in 2002 Hackensack hired a trauma surgeon as its tech evangelist. He's making progress: The hospital's internal Web portal had 344,000 visits last year, up from 3,000 in 2000. Yet hurdles remain: Only 10% of tests and drugs are ordered electronically.3. USING DATA TO BOOST QUALITY
The real payoff is finding errors and improving care. Hackensack halved the time between when a drug is prescribed and when it reaches the patient. It also redesigned its congestive heart failure and orthopedics procedures, improving to the top 10% of hospitals treating those diseases in a Medicare program.4. GETTING DEALS FROM INSURERS
Insurers are paying more for better care, since it leads to fewer repeat visits. Medicare is testing a program that pays an extra 2% per case to hospitals with treatment scores in the top 10% for illnesses such as pneumonia, heart attacks, or hip replacements. Since Medicare pays for about 30% of U.S. hospital care, that's enough to double profits at some hospitals.5. USING QUALITY TO LURE CUSTOMERS AND BUY MORE TECH
Insurers and big employers are trying to push consumers to tech-savvy, high-quality hospitals. How? They reduce co-payments if patients use preferred providers and post care-quality info on insurers' sites. Horizon Blue Cross is pushing cardiac patients to Hackensack because of the improvements it has made using tech.