Recently there has been increased focus on the need to modernize the healthcare information infrastructure in the United States. The U.S. healthcare industry is by far the largest in the world in both absolute dollars and in percentage of GDP (more than $1.5 trillion, or 15 percent of GDP). It is also fragmented and complex. These difficulties, coupled with an antiquated infrastructure for the collection of and access to medical data, lead to enormous inefficiencies and sources of error. Consumer, regulatory, and governmental pressure drive a growing consensus that the time has come to modernize the U.S. healthcare information infrastructure (HII). While such transformation may be disruptive in the short term, it will, in the future, significantly improve the quality, expediency, efficiency, and successful delivery of healthcare while decreasing costs to patients and payers and improving the overall experiences of consumers and providers. The launch of a national health infrastructure initiative in the United States in May 2004--with the goal of providing an electronic health record for every American within the next decade--will eventually transform the healthcare industry in general, just as information technology (IT) has transformed other industries in the past. The key to this successful outcome will be based on the way we apply IT to healthcare data and the services delivered through IT. This must be accomplished in a way that protects individuals and allows competition but gives caregivers reliable and efficient access to the data required to treat patients and to improve the practice of medical science. This paper describes key IT solutions and technologies that address the challenges of creating a nation-wide healthcare IT infrastructure. Furthermore we discuss the emergence of new electronic healthcare services and the current efforts of IBM Research, Software Group, and Healthcare Life Sciences to realize this new vision for healthcare.