A venture capital firm set up by the Central Intelligence Agency is financing a Chicago-based information technology company whose software already is serving as a key component in the nascent national health information network. And the software, produced by Initiate Systems, is poised to play a much larger role in the national network.
While privacy advocates expressed concern over the CIA connection, several healthcare IT experts and users of the firm's software were indifferent to it because of where and how the software is used within their IT systems.
Founded in 1995, Initiate Systems is an IT vendor with operations in several industries in addition to healthcare, including banking, communications and gambling. But in healthcare Initiate is on a roll, racking up a number of big clients for its software, which employs probabilistic matching algorithms to link patients to their records.
Among its clients are: RxHub, a for-profit corporation founded in 2001 by a consortium of the nation's largest pharmacy-benefit management companies; SureScripts, a company that facilitates electronic prescribing; the Veterans Health Administration, which operates more than 150 hospitals among its more than 1,300 care sites; and the industry-leading regional healthcare information organization MA-SHARE, Boston, which is a participant in an HHS contract to develop prototypes of the national health information network.
Initiate's influx of CIA funds came in February, when Initiate received its fourth round of venture capital financing, this time led by In-Q-Tel, an Arlington, Va.-based venture capital firm founded in 1999 by the CIA as an independent organization. But it continues to be financed by and under charter to the spy agency, according to its Web site. In-Q-Tel and Initiate Systems both disclosed the existence of an investment relationship between them in a public statement dated March 22 that was posted on their Web sites. Initiate Systems mentioned it again at the bottom of a news release issued two weeks ago.
"Initiate Systems has unique technology that enables extremely accurate and secure information sharing and entity resolution across organizations, which is of great value to the intelligence community," said Amit Yoran, president and chief executive officer of In-Q-Tel, in the March 22 statement.
The CIA's intent in creating In-Q-Tel was to help the agency "identify, acquire and deploy cutting-edge technologies" by investing in startup companies, according to the company's Web site. But details of the scope of the CIA's involvement and interest in health records were unclear.
In an e-mailed response to questions, In-Q-Tel spokesman Donald Tighe said the company declined to disclose the dollar amount of its investment in Initiate, or the percentage of its ownership stake in the company. In a separate e-mail attributed to Jeff Galowich, Initiate executive vice president and co-founder, Galowich said the entire financing round was "relatively small," and In-Q-Tel did not gain a seat on its six-member board.
Initially, according to Tighe, In-Q-Tel "focused solely on the CIA." Now, however, with enhanced "connectivity between multiple U.S. intelligence agencies, In-Q-Tel now supports both the CIA and the broader intelligence community," he said.
Tighe declined to comment on whether the intelligence community plans to use electronic medical records in intelligence gathering, and if so, for what purpose, and if not, what use will it make of Initiate software in a nonhealth application. "In-Q-Tel cannot answer questions regarding product usage," he said.
CIA spokesman Paul Gimigliano said in an e-mail, "The intelligence community's interest in software from Initiate Systems has nothing to do with its application to the healthcare industry. Indeed, the technology has been used in other fields. The intelligence community is simply looking for tools that will help it assess and verify data of its own." Gimigliano said the CIA and other intelligence services financially support In-Q-Tel as well as receive technologies acquired through the venture capital firm.
Scott Schumacher, senior vice president and chief scientist for Initiate, said in a telephone interview that he doesn't know what the CIA's plans are for the software, just that the agency has asked the company to make what he described as a routine modification to the software to meet government security protocols and adapt the software to recognize Korean and Arabic language characters. Schumacher said Initiate plans to use the language adaptations in commercial applications with private-sector clients. Other than those customizations, the sale will be much as if Initiate were selling the CIA any other commercial off-the-shelf application, Schumacher said.
Several users of Initiate software said they have little concern about the CIA's investment. Broadly characterized, they said that because they run Initiate's software behind their systems' firewalls, intelligence sources can't use the software to mine their data without permission.
Those who said they are unconcerned included Mark Overhage, an associate professor of medicine at the Indiana University School of Medicine in Indianapolis, and John Halamka, chairman of the Health Information Technology Standards Panel, a federally funded body seeking to harmonize healthcare data standards, and chief information officer for CareGroup Healthcare System and the Harvard Medical School. Halamka also serves as CEO of MA-SHARE.
But privacy advocate Deborah Peel, a Texas psychiatrist and chairwoman of the Patient Privacy Rights Foundation, called the CIA connection "outrageous," noting that it simply doesn't pass the sniff test. "Who doesn't believe if the CIA puts up that money, they won't have access?" Peel said. "I'm still not satisfied."
Access, or the lack thereof, isn't the only issue, but how the software could be modified by Initiate or the CIA for future use by the agency, based on lessons learned in healthcare, according to Joy Pritts, a lawyer specializing in privacy issues and a research associate professor with Georgetown University's Institute for Health Care Research and Policy. "It does provide them a window into these (healthcare IT) systems," Pritts said. "If they ever decide under the Patriot Act they want access to these systems, they will know exactly what they can get and how to get it. They will know what is doable."
Schumacher, the Initiate vice president, questioned that conclusion. "I don't think that's really much of a worry," he said. "I don't think that we make that any easier or any harder than it is now. If somebody lets them in, then whatever technology they have, it's no harder or easier. I really do think the people who own the data need to protect it."