Open Data in Healthcare

We often take for granted Global Positioning System (GPS) technology and forget it is only in existence because the Department of Defense has the scale and human capital to have a.) built it and maintain it and b.) share it with the world.

In 2000 GPS accuracy improved by an order of magnitude (Selective Availability, see here:  Those early adopters who owned GPS devices prior to the accuracy improvement found value in them, but that value mushroomed when the SA change was made.

Healthcare open data today can, I think, be fairly compared to the GPS function prior to the SA change.  Having it is certainly valuable.  For example, consumers can research quality data for hospitals, home health agencies, & nursing homes amassed by the Centers for Medicare & Medicaid Services.  As of last year, consumers can also review relative Medicare charge amounts at the procedural level across dozen of provider specialties and 800,000 physicians.  While the press may be focusing on the less than 1% of the physicians that may be committing Medicare fraud, the real value lies in the broader open data initiative and the positive implications it has for all stakeholders, including physicians.  (Note, we don’t publish total amounts paid to doctors because it does not add any value – we are not in the Witch Hunt business.  Reimbursement rates are very complex, the total amount often applies to a practice and not an individual doctor, some claims data contains modifiers, which can skew the appearance of costs lower, and finally, the amounts are only for Original Medicare.)  But we do think knowing the specific procedures physicians have performed are extremely relevant.  If you want to buy a pair of shoes, its nice to search for “shoes”.  If you need a CT scan for your back, the same principle applies.  That is why we have built our procedural search tool.)  If you have a loved one who needs home health care services or a nursing home facility, our site is a great place to reference.

Today, open data in healthcare is off to a great start.  It may not be as accurate as GPS in the sense of knowing the exact amount you will pay, but it performs a lot of the “heavy lifting” for consumers looking to become more engaged in the management of their health care budgets and desire to become more informed.  The federal data we are using can be applied to consumers in private insurance plans; its value is not limited to consumers enrolled in Medicare.  Furthermore, the actual consumer of the federal healthcare open data may be the primary caretaker – the beneficiary’s adult child(ren).  In terms of the benefits for the private sector, we are just one example of a company benefiting.  It is unfathomable to think how much it would cost us to be able to publish our content were it not for open data.  It’s easily over $100 million, if not $1B.  GPS, for example, exists because of the development and delivery of 24 satellites! Even Elon Musk would have a hard time footing that bill…

From Gasoline to Jet Fuel

I often describe our site as an oil refinery.  We take the raw material (open data) and refine it so it is more useful and relevant by categorizing it, enabling geographic searches (thanks to GPS), and adding more value through search functionality and combining some cost data with quality metrics.  So its pretty damn good for government work, as no one ever said until now.  But how can we as entrepreneurs do better?  How can we take regular unleaded gas and convert it to jet fuel?  We have some ideas and will hopefully get the opportunity to develop them.  We think the next stage is creating more value for the providers; in fact its the providers that will need to get us to the equivalent of Selective Availability abolishment.  Buried in paperwork and faced with constant change, physicians today are losing their passion for why they pursued the medical sciences.  Who can blame them?  It’s akin to successfully training for Carnegie Hall and being relegated to performing on a side street in a rural town.  We believe that the consumer-provider relationship needs to become more intimate and less constrained by managed care.  Technology is the reason this can happen efficiently.  For example, we want to give providers the ability to “claim” their profile on our site to let them perform their own enriching and refining.  Allow them to tell us more beyond “eligible network provider”.  Allow them to post cash prices to the extent it is feasible (to avoid paperwork and payment cycle delays).  Allow them to list the insurance plans they accept, and if there is a change, consumers that make them a “favorite” provider on our site are notified via email or text.  Allow providers and small, medium, and large provider networks to develop their own equivalents to health insurance plans.

The Gods Amongst Us

It will take time, a moment of clarity that competition belongs in the healthcare sector, innovation, and the failure of some industries if we are going to take healthcare as a percentage of our overall economy from 19.3% to a more sustainable level.  People will continue to get sick and die (at least until Musk turns to healthcare) and hopefully we will have a growing supply of doctors (a topic for another day is the need to welcome more foreign physicians).  Examples of mass disruption exist today.  Anyone who hasn’t read about Theranos Founder Elizabeth Holmes needs to; it is people like her that will save healthcare and improve quality of life:  Disruption like Theranos will be uncomfortable for entrenched companies, but I don’t hear people lamenting the demise of the horse-drawn carriage today.  If we get a few more Elizabeth Holmes to arrive on scene, our country will be in a much improved state.

Industries that elect to keep their blinders on will be the first to fall.  For example, the fact that Zenefits was not named the benefit broker of the year sure puts a giant bullseye of the benefit brokerage industry…Zenefits is an example of a incredibly brilliant business model disruption; get their robust software for free so long as you use them as your insurance broker.  That no one in the benefits space attacked this opportunity earlier sure makes us worry less about not receiving calls back from them when we try to introduce our solutions.

Thankfully there are innovators out there that will create massive disruption in the healthcare sector.  Their efforts are already being recognized by the aggressive valuations being assigned to them by leading venture capital firms.

To see what dent we are trying to make in the universe, register at the link provided below.  A great starting point is our home health, nursing home, and hospital compare tool:


Comments are closed.