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AMA Becomes Latest Online Health Player

The American Medical Association Friday became the latest organization to become a player in the health care information market, signing six physician groups to create a mega site for both professionals and consumers.

Partners for the Medem project include American Academy of Ophthalmology, American Academy of Pediatrics, American College of Allergy, Asthma and Immunology, American College of Obstetricians and Gynecologists, American Psychiatric Association and American Society of Plastic and Reconstructive Surgeons. The coalition will jointly own the new venture charged with creating the Web site.

The Medem site, which takes its name from an abbreviation for "medical empowerment", will become operational by early next year. The newly created company will be divided into independent editorial and business units. The editorial operation will create the site's health care content.

The business unit will design, develop and manage the Web site as well as select advertising, which will be accepted under strict guidelines. The coalition said it will ensure that the revenue generated by the venture is used for supporting and improving the site, and to support a charitable foundation to assist the poor with health care costs.

Any revenue earned by the AMA will support the association's role as advocate for the medical profession and the patients it serves, the company said. The site will also offer a feature which will allow patients and physicians to communicate confidentially via the Internet.

"What makes this site unique is that it is founded by well-established, professional organizations with proven experience. The AMA has been providing reliable patient information for more than 150 years," said Dr. Manhood, an AMA trustee.

"And, of course, we wrote the book on medical ethics. The bottom line is, no one can surpass this collection of associations when it comes to quality and integrity."

The site pits itself in competition against a long line of established health care sites, including drkoop.com (KOOP), CBS' recently acquired Medscape (MSCP), Healtheon (HLTH) and WebMD. Healtheon and WebMD recently merged, although the deal has not closed. Each site has had its moments of substantial investments, mega deals, and several have made notable IPO appearances.

With many analysts citing Dr. Koop's former post as U.S. Surgeon General and Medscape editor-in-chief Dr. George Lundberg's 17-year reign heading the Journal for the American Medical Association as major factors in the success of their sites, the AMA hopes its credibility will compensate for its delayed entry into the market.