DAOU Systems and Celotek partner to provide solution for enhanced security of health care system information

-- DAOU Systems, Inc., a leading provider of Information Technology solutions and services to the health care industry, and Celotek Corporation, the leader in high-speed Virtual Private Networking (VPN) security solutions for commercial Asynchronous Transfer Mode (ATM) networks, have entered into an agreement allowing DAOU to resell and install Celotek's full line of CellCase cryptographic devices that secure the transmission of ATM-based information through encryption.

Utilizing encryption in health care Information ATM-based networks, such as that provided by implementation of the CellCase devices, will allow health care providers to protect sensitive patient information over wide-area and campus-based networks, and support their ability to meet the significant challenge of complying with the Health Insurance Portability and Accountability Act of 1996 (HIPAA). The proposed HIPAA regulations mandate that patient information be encrypted when sent through data links outside of a health care facility's direct control. By adding transparent ATM encryption technology to its offering of security products, DAOU will strengthen its position as a provider of solutions to the HIPAA challenges facing the health care system.

Commented Eric Ringwall, Chief Technology Officer for DAOU Systems, Inc., "We are very pleased to be adding the CellCase product line to our diverse set of security-focused solutions and products. The product line provides protection of our customers' ATM networks, aiding in their compliance with the HIPAA mandates and providing a secure infrastructure that will support secure e-business-based initiatives in the health care arena. The Celotek products fit very well with our line of security services, and extend DAOU's ability to provide high-quality ATM infrastructures that provide secure transmission of voice, video and data."

"Security is a critical issue in the health care industry, and is becoming more difficult to ensure with today's complex networks," said David Brame, Vice President of Sales for Celotek. "Our leading broadband network security products, coupled with DAOU's established relationships in the health care sector and expertise in the integration of hospital and telemedicine networks, creates a partnership that can effectively meet this market's growing security needs." Brame added, "Several upcoming strategic installations of our product in the health care arena require a premier health care integrator, and we are extremely pleased to announce that we will be working with DAOU to meet those needs."

Noted Larry Grandia, DAOU Chief Executive Officer and President, "It is anticipated that the health care industry will face a large and potentially costly task, perhaps greater than the Y2K challenge, in implementing mandated HIPAA requirements. Regulators are drafting final language of the regulations, which are expected to be issued soon. The health care industry will have only two years to comply with these new regulations, and we intend to strategically position DAOU to meet our customers' needs in this area and to participate in this potentially significant market opportunity."