The ailing U.S. economy might turn out to be just the right medicine for a long-debated proposal to take the nation’s health care system deeper into the electronic age.

Known as “health information technology,” the legislation could provide doctors with financial incentives to move to electronic prescriptions and medical records with the goal of giving all health professionals a patient’s history at their fingertips.

President-elect Barack Obama has said he wants health IT included in a potentially fast-moving economic stimulus package to help ease the financial crisis.

“The possibility of including it in the stimulus package is the best chance for passage since health IT was introduced four years ago,” said Kara Calvert, a director of government relations for the lobbying group Information Technology Industry Council.

“There are sticking points that are certainly going to be a challenge, but you have some really committed Members. And the fact that the president-elect is committed to this will drive the train a lot,” she said. “The momentum wasn’t there the previous years, but it’s up and running now.”

The high-tech industry and many medical and health care groups support the idea, at least in theory, because they say it could reduce medical errors and help lower costs by eliminating unnecessary hospitalizations or duplicate tests by different doctors.

But differences remain in how to implement a program that would truly allow the new systems to work together — if doctors and hospitals buy new equipment that doesn’t operate with other providers’ new systems, then the effort could be moot, many argue.

And perhaps the biggest concern comes from privacy advocates who argue that any government-encouraged move to electronic medical records must include strong protections for patient-sensitive data.

Ashley Katz, executive director of Patient Privacy Rights, said one of her group’s top concerns is to make sure that patients’ online information is protected from potential marketers.

Katz also wants governmental standards for data encryption and for giving patients control over how their medical data is used.

“We would be opposed to spending millions or billions on health IT without those things being put in place,” she said.

Katz’s organization has joined with other groups — including the American Civil Liberties Union, National Association of Social Workers and the AIDS Action Council, among others — and is sending a memo to Capitol Hill this week outlining their concerns.

“Progress for health IT and privacy is being made! We hope you will join our Coalition in protecting the right to privacy for consumers, employees, and providers,” the memo states.

The Center for Democracy and Technology is also examining the potential privacy concerns, said Deven McGraw, the group’s Health Privacy Project director. “There’s a double-edged sword to these technologies,” she said. “They have so many potential benefits, but on the other hand, they also make it easier for people to get access to your data who would want to use it for marketing purposes. We’re very eager to see a set of privacy provisions.”

Many doctors say they would welcome a hefty government investment in the new technology and believe privacy concerns are exaggerated.

Take Dr. Jim King, a physician in Selmer, Tenn., who is board chairman of the American Academy of Family Physicians.

“We personally think it’s a great idea that they’re considering adding a significant amount of money for health IT to the stimulus package,” he said. “We’re going to have to move to the point of having electronic health records in our offices so we can follow protocols and share information with other physicians and decrease duplication of different services.”

King said small medical practices of two to four doctors are the ones that need the most help in buying the technology equipment. “They have such a thin profit line,” he said. “They need to make sure the stimulus is going to help them.”

He added that he doesn’t think concerns over privacy should delay the measure. “All the privacy issues that people are discussing are protected in your banking,” he said. “We can have the same protections. We definitely don’t want to use it as an excuse not to do this.”

The Pharmaceutical Care Management Association, a group that represents companies that manage prescription drug plans, has long lobbied for health IT legislation, but the group’s president, Mark Merritt, said any bill must include electronic prescribing.

“The funding should only pay for electronic medical records that include e-prescribing,” he said.

That’s a key to reducing health care costs and medical errors, which can lead to unnecessary hospitalization, complications and deaths, Merritt said.

“If the physician knew all the medications, knew all the allergies and had that information in real time, you’d have just thousands and thousands of lives saved,” he said. He added that if doctors, when prescribing drugs, could immediately access a patients’ plan to know what drugs are available to them at affordable prices, then the doctors could opt for cheaper drugs when appropriate.

“We’ve met with transition officials, folks on the hill, and we have a lot more of that to do,” Merritt said. “We’re at a point where people really want to get this right. We’re in a good position to help them understand.”

He said his group definitely does not want to see a health IT bill that simply provides money to buy tech equipment. “We want to make sure that this equipment is actually used and operational, not just benefiting the IT companies,” he said.

Calvert, the tech industry lobbyist, said the companies that she represents have the same goal of building networks that can talk to one another.

“We actually think that that is the probably the most critical piece of a bill, to make sure that there is a framework in place for interoperability standards,” she said. “It actually helps technology companies.”

The broader business community, too, is throwing its weight behind the bill.

John Castellani, president of Business Roundtable, said his group is putting its lobbying behind health IT by taking its message to Capitol Hill leaders.

“Our broad guidelines for supporting a stimulus package include making sure that we make transformational investments so they enhance the nation’s competitiveness and productivity,” he said. “Health IT is one we think meets that criteria and can not only help our ability to compete, but also is a critical part of controlling our health care costs.”

Even though the massive stimulus package is a priority for the incoming president and the Democratic Congress, that scarcely guarantees health IT’s future. “We’re hopeful, but there’s a long way to go on the package as a whole,” Castellani said.