I read with great interest Paul Roemer's post last month -
EHR market is ripe for the taking by Google, Microsoft, Oracle
I've a lot of respect for the people working at that other sharp end of health. There are times when they are where I would like to be: not the bleeding edge, but the business edge:
Paul is a healthcare strategist and the managing partner of Healthcare IT Strategy, which helps health care providers solve business problems using EHR, workflow improvement, and change management.
Mr Roemer is out there among the corporations, the deals, the media frenzy and the stock market's take on health care AND health IT. He is addressing specific audiences and over here in the UK we can hear the debate raging. My problem is that working for the NHS all my career I have been and am cocooned. Even though I try to venture out and get involved, this is the very powerful criticism of long-term public sector employees. While far from totally sheltered from economical and political climate change, we are protected from the worst of
the business elements. Despite this, seeing the title of Paul's post and his two rules:
Rule No. 1: Content is king. In cable, it is channels such as HBO and Discovery. In healthcare it is data--patient data, effectiveness data, disease data.
Rule No. 2: The cable/telco model values the businesses based on the number of assets (subscribers--you and me). Each body adds somewhere between $5,000 and $10,000 to the valuation model of a Comcast or a Verizon. Downstream, some valuation will be placed on each PHR subscriber.
- two additional rules sprang instantly to mind. ...
Rule 3: Beware low hanging fruit
I posted in April 2009
Data sharing, privacy, health, citizenry.... "Database State" expressing concern that the sanctity of personal data is being eroded bit-by-bit in the mind of the general public by the media and the sheer ubiquity of information and technology.
Peaches, plums, pears are delicious when ripe, but as such they need to be handled very carefully. So too does the
Personalised health record amid a variety of threats - the worst of which are often internal. In health care the patient data that Paul identifies in his Rule 1 is central, and a key issue is the demarcation of individual and anonymised aggregated data. Hence, Paul quite rightly points to a
regulated market. Personal data can be far more valuable in terms of direct marketing and so the temptations for misuse are profound.
In the UK an
NHS consultation has addressed the additional uses of patient data. This concerned the research capability programme and provision of a
health research support service; with events to present proposals and debate the various issues that include information governance....
Information governance is not fixed, nor should it ever be.
In Paul's rule 1 content is king and content=data - in this case:
- patient data;
- effectiveness data;
- disease data.
This list of data would surely qualify as being 'broad spectrum' in nature. If its circulation is not very tightly controlled it can damage the (care) environment. If not managed effectively across multifold 'borders' - national, regional/state, corporate, systems, organisations, users, testing, interfaces, legislative, public bodies - this data can mutate markedly despite the insistence upon standards. You see although Google, Microsoft and Oracle may take that ripe fruit, as they pick it they come across -
Rule 4: Whenever and wherever picked,
fruit can be tainted
This might include the odd bug, or one or two tainted fruit items perhaps? It could be problems in the form of parts of the EHR that are difficult to incorporate, with questions of shared access and
ownership? If the fruit is indeed pristine, no blemish, no chemicals, no truly-devoted-insect-kisses: what are the overheads with this particular harvest?
If Google, Microsoft and Oracle believe they can
do an Indiana Jones and just shoot to solve the problem because, as Paul suggests, they have the 'numerics' in the cable/telco model, then they need to take care
(even if only improvising).
Microsoft, CSC and many other corporations already know of the complexity that reigns (pours in fact!) from their experience in health IT. Paul highlights Google as a new kid in town. Maybe acquisition does obviate the need to learn quickly (let others learn the lessons). But whatever the point of entry: health care (IT) remains a cussed business. And the future mix demands (begs!) the integrated addition of social care, but how and to what level?
It is not enough to counter "let's attack this complexity with simplicity." Health and social care are metronomic. They alternate between complex - simple descriptions (one of which is
re-organisation). Plus, that metronome may as well be in a closed box:
Its owner is one Mr Schrodinger.
Care to
gamble?
Paul's post is also fascinating since predictions about subscription numbers do count and speak volumes (sorry - but they really do). They will not only reach shareholder's ears, but when the model takes off - the general public's too. This could help erode the cherished sanctity of my personal data. So am I saying that some of the giants of corporative intelligence turn and run screaming, arms raised like surprised Martians in alien territory? No.
Maybe, as I have found -
the real low hanging fruit is the m+del.
Is it as ripe and appropriate in this market as it seems?
Or is it past its sell by date?
Time as ever will tell.
Additional link: NHS data breaches: the 'cogeography' of who and where?
Image source:LowHangFruit.com
=============== Paul's Post Follows ==============
December 17th, 2009
by Paul Roemer
The national EHR market is ripe for the taking by a big three like Microsoft, Google and Oracle. Heck, I'll even go so far as to suggest that when the dust settles in about five or seven years, the National Health Information Network will be a regulated combination of a handful of those firms.
As for the other firms offering or planning to offer PHRs, permit me to suggest the following scenario: Let's say I am in charge of Google's somewhat non-existent healthcare line of business. One of my goals would be to have more users of my PHR than any other firm.
Why does this model make sense? Two ways, both of which come from the cable/telco business model.
Rule No. 1: Content is king. In cable, it is channels such as HBO and Discovery. In healthcare it is data--patient data, effectiveness data, disease data.
Rule No. 2: The cable/telco model values the businesses based on the number of assets (subscribers--you and me). Each body adds somewhere between $5,000 and $10,000 to the valuation model of a Comcast or a Verizon. Downstream, some valuation will be placed on each PHR subscriber.
So, back to the example of me running Google's healthcare offering. (If you don't like Google as an example, insert your favorite firm.) If I'm Google, am I troubled by the fact that other firms are building their own solutions? No, because the difficult part of the business model is adding users, adding subscribers. Why not let a bunch of firms do the business development work for me, do the dirty work to get the users, and then just devour those firms? Once I own them, I convert them to my platform. Do I then get some 'ownership' or right to use the data? That would certainly be the business goal.
One million users valued at $5,000 adds $5 billion in valuation. Ten million adds $50 billion. Ten billion is about 2.5 percent of the U.S. market. Do I stop at the border? Of course not.
By the way, while all this is going on, Google, Microsoft, or some other company will also be creating standards and building or buying up EHR firms.
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