As we’ve learned since the advent of the Industrial Revolution, major technological advances have the potential to radically transform a whole industry, but realizing that potential generally requires large intangible investments and a fundamental rethinking the industry being transformed. So, it’s not surprising that there’s much hope and excitement that the advent of AI as a major 21st century technological advance might, over time, help to radically transform our highly complex and expensive healthcare industry.
Healthcare is a system of coupled systems, encompassing medical and pharmaceutical research; the delivery of healthcare to patients by a variety of practitioners, including hospitals, physicians, nurses, and pharmacists; and the insurance companies and governments that pay for healthcare. Healthcare costs have continued to rise across the world, especially in the US. Total healthcare spending in 2023 was approximately $4.7 trillion, accounting for 18% of US GDP, and is projected to grow at an average of 5.5% per year to over $7 trillion in 2031, roughly 20% of US GDP.
The potential evolution of healthcare brings to mind my personal experience in the information technology (IT) industry for the past 50 years.
US productivity grew at only 1.5% between 1970s and the early 1990s, a period of slow productivity that coincided with the rapid growth in the use of IT in business. “You can see the computer age everywhere but in the productivity statistics,” said MIT Nobel Prize laureate economist Robert Solow in 1987, in what’s become known as the Solow productivity paradox.
A major reason for the slow productivity growth is that despite advances in computer technologies, proprietary systems from different vendors didn’t interoperate with each other in the early decades of the IT industry. Just sending an e-mail across two different proprietary networks and applications from different vendors was quite complicated, as was sharing information across disparate systems
This all changed in the 1990s, when the Internet and World Wide Web brought a badly needed culture of standards, interoperability, and collaboration to the IT industry. Open network protocols, e .g., TCP/IP, were widely embraced across the marketplace, making it possible to interconnect systems from any vendors. Internet e-mail protocols, — SMTP, MIME, POP, IMAP, — enabled people to easily communicate with anyone on any system. Similarly, the Web’s open standards, — HTML, HTTP, URLs, — enabled any PC connected to the Internet to access information on any web server anywhere in the world.
A similar story played out with Unix. In the late 1980s, Unix became a popular operating system for technical workstations, supercomputers, and the emerging internet systems. But, every vendor had developed its own proprietary version of Unix, — IBM’s AIX, Sun’s Solaris, HP’s HP-UX, and several others, — and they were all somewhat different and incompatible with each other, making it difficult to port applications across these different flavors of Unix. Finally, Linux emerged in the 1990s as an open source Unix-like operating system that over time was embraced by just about all vendors.
A paper published by the US National Academy of Medicine (NAM) in June of 2022 noted that “Digital health has evolved as a broad term encompassing electronically captured data, along with technical and communications infrastructure and applications in the health care ecosystem. Revolutionary advances in digital health are transforming health, medicine, and biomedical science, and redefining and re-engineering the tools needed to create a healthier future. Developments such as cloud computing, artificial intelligence, machine learning, blockchain, digitally mediated diagnostics and treatment, telehealth, and consumer-facing mobile health applications are now routinely used in self-management, health care, and biomedical science. These developments promise to drive earlier diagnoses and interventions, improve outcomes, and support more engaged patients.”
Could these digital health advances help us transform our highly complex and expensive healthcare sector?
“Despite important gains in the last two decades, made possible by significant investment by payers, providers, and the federal government in electronic health records (EHRs), progress toward interoperable systems, and advanced technology to coordinate care and manage disease, the promise of digital health remains illusory,” said the authors of the NAM paper. “The ability to use interoperable digital technology to improve the effectiveness, efficiency, equity, and continuity of care remains substantially conceptual. For example, digital interfaces in inpatient care systems are often clumsy; volumes of health data are mostly sequestered, inaccessible, and difficult to aggregate in a meaningful and actionable way, in part due to the ongoing need for evolving data standards.”
Over the years, we’ve learned that standards and interoperability protocols that enable access and exchange of data through open source projects encourage innovation and collaboration among all the participants of an industry sector. Could open source platforms help overcome the interoperability and coordination issues across healthcare systems from different vendors and institutions?
“Healthcare systems around the world are under increasing pressure and while there is a widespread belief that digital technologies have the potential to have a transformational impact, as they have in other sectors, we are yet to see this in health and care,” wrote Ewan Davis and Tony Shannon in Defining an Open Platform, a paper published in 2017 by the Apperta Foundation, a UK-based not-for-profit organization that promotes open systems and standards for digital health and social care.
“This failure flows from the complexity (technical, cultural, and regulatory) of the health and care environment which creates insurmountable barriers for the sort of innovative start-ups that have been the engine of transformation in other sectors. There is a strong and growing view that open platforms represent a solution, lowering the barrier of entry into the market and through this, supporting the injection of innovation.”
Why does the status quo inhibit innovation in the health care sector?
As articulated by Harvard professor Clayton Christensen in his books and articles, disruptive innovations play a major role in rejuvenating an industry with new concepts, products, and business models, and these innovation are generally introduced by startups entering at the bottom.
“The complexity of both the health and care environment and the data means that the likelihood of a new entrant succeeding is significantly less than in other sectors,” wrote Davis and Shannon. “Any new product must integrate with existing systems and share data with them. Here the proliferation of non-standard interfaces and data formats and the difficulty of getting information and cooperation from existing vendors make this an often impossible task.”
“In addition, regulatory barriers relating to safety, information governance and cybersecurity which are necessarily higher in health and care than many other sectors, place a further burden on new entrants. These combine with a conservative, risk averse culture and the horrors of public sector procurement to make health and care an extraordinarily difficult market for a new entrant to get a foothold in.”
The answer, argues the paper, is the development of an open health platform that provides infrastructure and services based on openly published standards. Such an open platform would make data and applications portable and interoperable across different platform implementations, thus eliminating lock-in and facilitating innovation and competition.
“An open platform implementation will exist in a secure cloud environment exposing the services that application developers need to securely store, share and process data. It will enable them to access and consume knowledge and resources via a set of standardised open Application Programming Interfaces (APIs). This frees the application developer to focus on what they are good at — creating applications! There are potentially many hundreds of possible platform services, but a minimum viable platform needs only support a handful of services based on the core standards of HL7 FHIR, SNOMED CT, openEHR and IHE-XDS.”
“The endgame is to create an open ecosystem that will drive competition at the application, service and platform levels. There will be no vendor lock-in. The end user will be able to select a unique set of applications drawn from multiple vendors, where each application will meet the end user’s unique needs, and where each application will work seamlessly together. The user will make their selection on the basis of quality, value and performance.”
Comments