One reason Kipu is attracting treatment facilities is mobility: Most facilities equipped with Kipu software issue Apple iPads to employees to tap into the program. For nurses, in particular, “it makes their life so much easier,” said Tobias Franoszek, chief technology officer of Kipu. “Even most patients have one at home, so people feel very much at home with that type of technology.”

Still, concern over patient-privacy violations can stunt the growth of an EHR vendor. The Health Insurance Portability and Accountability Act of 1996, also known as HIPPA, established standards for securing patient privacy and set penalties for breaches of security. HIPPA rules also bar the transmission of electronic health records through commonly used email services, so software systems for medical records typically have log-in access to secure email communications.

Under a revised set of HIPPA rules, a vendor of such products as software for billing or clinical purposes could be legally liable for a breakdown in patient privacy. Previously, “they were not held liable, but now they are,” said Lisa Rawlins, director of healthcare at Fort Lauderdale-based SRG Technology, a software development company. “That was one of the new provisions in the HIPPA rules.”

Even relatively small security breaches can mean sizable fines for patient-privacy violations. The U.S. Department of Health and Human Services in January imposed a $50,000 fine on a hospice in Idaho, the department’s first financial penalty for a security breach affecting fewer than 500 individual records. “This has caught the attention of many of the smaller providers in the healthcare industry, and rightly so,” said Gail Blount, marketing and communications manager of JDL Technologies, a software company in Fort Lauderdale.

Wellington-based IT entrepreneur Matthew Ehrlich believes the key to avoiding privacy issues is putting the patient in charge of his or her medical records. He has started a business called Healthost.com that aggregates the personal medical records of users with their permission. “The HIPPA restrictions go away the second you agree to put the data with a third party,” Ehrlich said. So, with permission from its registered users, Healthost.com can search for their health records and securely store them on its website. “The data is scattered all over the place,” he said. “That really is the issue, scattered data.” Healthost.com expects to announce new deals with two hospitals soon and to expand its staff of 16 employees.

Despite the risk of privacy breaches, the healthcare industry continues to march away from paper records. Hospitals are leading the way. They not only invest millions of dollars in paper-saving EHR systems but also charge steep prices for printed copies of patient records. “It’s not cheap,” said Robert Seitz, chief technology officer of Support Services Group, a South Dade company that advises physicians on purchases of EHR systems. He said many large South Florida hospitals charge $1 per page or more when patients request hard copies of their records.

To encourage digitalization, Miami Children’s Hospital is targeting the venerable printer. “We’re not going to eliminate [printers] altogether,” said Ed Martinez, senior vice president and chief information officer of the hospital. “But we’re going to minimize the number of printers and force people into a more electronic practice.”

Miami Children’s has invested $60 million in EHR technology in the last 2 1/2 years, Martinez said. Remote access to patient files at Miami Children’s is one of the returns on investment. “Physicians can get into our servers from anywhere,” he said. Though many physicians continue to resist adoption of EHR technology, “the new kids coming out of medical schools and opening up practices are definitely embracing this.”

Although Miami Children’s and many other hospitals use EHR software systems to exchange patient records with physicians, the same type of electronic exchange between hospitals is much rarer. But that may be changing. Florida and the other 49 states have awarded federally funded contracts to create what eventually would be a national health information exchange.

Melbourne-based Harris Corp. has a federally funded, four-year contract with Florida to create a statewide network linking 20 local health information exchanges, many of them created by large hospital systems.

The company is working with EHR vendor Cerner to develop software interfaces that will allow users in different nodes to exchange patient information, said Janet Hofmeister, a project manager with Harris Corp. Doctors in one local health exchange, or node, will be able to search for patient records in another, but patient records filed in one node won’t automatically appear in other nodes.

“There’s nothing automatic about it,” she said. “That is something the physicians were very much against. They really wanted to keep control over their data. It’s all kept at the original edges of the system.”

Memorial Healthcare System, a Hollywood-based hospital operator, is one of the first “nodes” that will join the statewide network. “We anticipate our state connection to go live by the end of this month,” said Forest Blanton, chief information officer of Memorial. The hospital operator selected Epic Systems to provide its EHR software for accounts receivable and clinical functions. Memorial also has helped more than 100 of its affiliated physicians start using the Epic system in their offices. “It’s almost no cost to the physicians,” Blanton said.

Despite promising technological advances in the exchange of electronic health records, casualties are likely among companies currently active in the business. Some of the weakest companies in the business are likely to disappear by the time Harris finishes its work on the statewide health information exchange in 2014.

The principals at Nexus Clinical, a Miami Beach-based developer of physician-practice systems for electronic health records, are determined to stand out in the EHR crowd, not get trampled. “We have about 15 employees right now,” said Dr. Ahbinav Gautam, chief medical officer and vice president of Nexus Clinical, “but we’re trying to expand” despite competitive pressure. “There are many companies in this space.”

He started Nexus Clinical together with serial entrepreneur Pradeep Tripathi, the majority shareholder of the company. Dr. Gautam completed his residency in anesthesiology at the University of Miami and is now an assistant professor there. “I’m working on this endeavor [Nexus Clinical] full-time while practicing on a part-time basis at the University of Miami and Jackson Memorial Hospital,” he said.

The 2009 enactment of the HITECH Act was one of the reasons why the founders of Nexus Clinical launched the company the same year. Dr. Gautam recalled “thinking that this was the right time to get into the marketplace.” He said his optimism hasn’t waned since then, despite the competitive perils his company faces. “There will be some companies that don’t survive,” he said. “But I feel that this industry is a very nascent one.”