The legislation favors software companies that take a cut of doctors bills, such as Athenahealth Inc., run by Jonathan Bush. By contrast, Allscripts-Misys Healthcare Solutions Inc., headed by Glen Tullman, an Obama donor and adviser on health information technology, charges clients upfront for its software and would have benefited more from a failed Senate bill last year.

“Ironic, isnt it?” said Sean Wieland, an analyst at Piper Jaffray Cos. in San Francisco.

During the campaign, Obama championed a plan to spend $50 billion over five years to get the nations hospitals and doctors to abandon paper records, saying the switch would save lives by preventing errors. Health-care companies are scrambling to exploit the legislation, and as Tullman found, the winners and losers may be hard to predict.

The bill, passed last week as part of an $819 billion economic stimulus package, provides $20 billion for electronic health records. The Senate is now considering a similar bill, and House Speaker Nancy Pelosi has said she will cancel the Houses Presidents Day holiday break if a bill is not ready for Obamas signature by Feb. 16.

“The big hope is that sounder, more forward-thinking voices get in there,” Jonathan Bush said in an interview.

Incentive Payments

While investors wait to see which kinds of incentives finally make it into law, stocks that might benefit are surging. The ones rising the most since mid-January would profit directly from Obamas decision to provide incentives over time, rather than doling out lump sum payments.

Athenahealth, which sells services to track patient records and run insurance collections for doctors offices, has almost doubled since hitting a 52-week low of $19.19 on Nov. 21. The stock fell 38 cents to $37.20 yesterday in Nasdaq Stock Market trading. MedAssets Inc., whose software helps hospitals manage billing and purchasing, has jumped 48 percent from its low of $9.91, also on Nov. 21. The stock rose 25 cents to $14.68 yesterday.

Both Athenahealth, based in Watertown, Massachusetts, and MedAssets, in Alpharetta, Georgia, offer their software over the Internet, which means theyll gain the most from Obamas plans of offering incentives over time, Piper Jaffrays Wieland said.

Falling Shares

Allscripts, based in Chicago, has lost 17 percent this year. The shares fell 22 cents to $8.22 yesterday on the Nasdaq. It is still up 23 percent from its Election Day closing price of $6.66. Quality Systems Inc., a software company with a business model similar to Allscripts, has fallen 15 percent this year and is down 7.9 percent from its Election Day closing price of $40.27.

“The most effective way to stimulate any activity isnt to give an incentive tomorrow,” Tullman said. “The president will come out with legislation that combines the best of both approaches.”

The shift to long-term incentives will improve patient care while avoiding subsidies to hospitals that can already afford the technology, said David Brailer, former health-care information-technology coordinator for the Bush administration. That approach is the best way to ensure that providers actually use the new systems, Pete Stark, the chairman of the House Ways and Means health subcommittee, said in an e-mail.

Medicare Reimbursement

The House and Senate versions of the stimulus bill both call for Medicare and Medicaid reimbursement payments to doctors and hospitals of about $18 billion over two years, Brailer said. The House would add $2 billion to pay for infrastructure and to connect providers systems in a national network, while the Senate bill may provide up to $5 billion for infrastructure, he said.

Separately, Senators Olympia Snowe, a Republican from Maine, and Debbie Stabenow, a Michigan Democrat, reintroduced their own medical-record bill last month, proposing $4 billion in grants and loans to help doctors and hospitals pay for technology. Tax breaks could mean total subsidies are worth $12 billion a year.

“Physicians and hospitals will move quickly when they know a substantial portion of their costs will be covered,” Snowe said in an e-mail. “This may be primarily through incentive payments, but supplemental grant and loan programs are also required.”

Finishing Installations

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