Mar 21 2014

Why Disruption in Health IT Is Like a Tiramisu Cake

In highly regulated industries, transformations don’t happen overnight in the same way that they do in consumer tech.

I’ve always viewed disruption in a regulated industry as somewhat similar to the process of preparing the batter of my favorite dessert: tiramisu. There is one step in the process that requires you to fold beated egg whites into a soup of yolk, flour, and sugar. This folding process is what gives the tiramisu consistency and weight and is basically the foundation of the entire dessert.

Similarly, in order to innovate or disrupt a regulated industry like healthcare, change requires patience and careful “folding” of whatever innovative technology or process you are bringing into the current status quo.

There are few industries fraught with more regulation and innovation roadblocks than healthcare. Visit any hospital and you’ll find medical devices unable to talk to one another or doctors making uninformed recommendations based on faulty or incomplete data.

But perhaps the biggest sign of the slow pace of innovation in health IT lies in the fact that fax machines remain the method of choice for transferring patient information.

In a world where we can transfer thousands of dollars instantly through the touch of a button, learn French through a mobile app, and the NSA can store, listen to, and compile all my phone calls and texts in less than a microsecond, how can healthcare be still be so far behind?

The Thing About Healthcare

Many will rightly point out that healthcare isn’t like social media or even mobile banking. The industry deals with the livelihoods of patients and the data gathered by healthcare workers holds their patient’s most intimate realities. This kind of environment demands closer scrutiny and the implementation of certain protections to allay the concerns of participants in every part of the healthcare equation. Which is why regulation has been put in place.

But in healthcare, regulatory policies and the patient’s best interests don’t always sync up. In between the misaligned incentives of malpractice insurance, where doctors are scared to try any technology or methodology that hasn’t been vetted by every regulatory agency (just to name a few: the ONC, FDA, FTC, even the FCC), to the compliance necessary to abide by not just the aforementioned organizations but of ancillary standards like HIPPA, ERISMA, HL7.

The daunting challenge that health IT startups face lies in navigating all of this regulatory barbed wire, challenging the status quo, picking up critical mass and doing things differently all at the same time.

Building Change in Health IT One Layer at a Time

Because of how dysfunctional our healthcare system is today, innovation will not happen overnight. Innovation in healthcare will occur through the gradual “folding” of technology and best practice into every aspect of care delivery. The system has put up some incredibly dense ‘firewalls’ for our protection, this is our stinky “soup” of egg yolk, flour, and sugar that lacks any real consistency or purpose (and I say this as I look at how much we spend $2.8 trillion on healthcare every year).

To change the makeup of this soup, we have to fold innovation into the equation by working with each hospital system or agency at a time, convincing them as we build each layer. Encouragingly enough, there have been small folds or changes over the last four to five years in the healthcare space that have slowly transformed the system’s perception of innovation and implementation of new technology.

For example, 10 years ago, any hospital executive or administrator would have told you that the hospital is the owner of a patient’s data. Today, there have been huge strides in changing that perception.

With the onset of mobile apps, wearable devices (like Fitbit, Wiithings, etc.), changes in risk models through regulation like the Affordable Care Act, you are now hearing hospital executives, insurance companies, and even government regulators say that the patient, not the hospital, owns his health data. A seemingly small change in interpretation but a big deal when you start to think of how that patient information is shared amongst doctors, your employer, or even family members.

For many people, particularly millennials, the ideal state of health IT would be one in which you are able to consolidate your healthcare into one app on your phone with a direct line to your doctor. That is our tiramisu in healthcare. But the reality is that we won’t see it unless our industry continues to change in small, measurable ways through slow but steady improvements in technology and processes. But just think, when that tiramisu is finally ready, boy, will it taste great!