Everyone Is Having the Wrong Healthcare Debate


In 1807, in an effort to spite the British and French for shipping interference (and forced recruitment of American citizens into military service), the United States Congress passed an Embargo Act, effectively shutting down trade with these two countries. Britain and France quickly found other trading partners; the US, then limited in our capacity to sell products outside our borders, was left with a devastated economy and a gaping hole in our face. It took only weeks before Congress passed a loophole; they repealed the act within 15 months of its passing. It was a great lesson in unintended consequences.

Today, ignoring history, both Republicans and Democrats seem to spar continuously around healthcare: whether the message is about tearing down the Affordable Care Act or about some version of Medicare (For-All, For Whoever Wants It, For America, or For Better or Worse), both parties are terribly wrong.

Assuming the social imperative for healthcare is to eliminate preventable morbidity and disability (and associated costs) and improve (or sustain) quality of health of all our citizens (in order to help as many of them as possible remain productive, contributing members of society), another approach to ‘universal care” would be to flip the figure/ground relationship for our current efforts: instead of developing better payment systems, let’s develop and commit to a universal clinical operating framework that ensures that every member of society has the same opportunity to optimize their health status.

“Centralizing” the methodology around a universal model for how we plan for care, and allocate resources to ensure care plan goal achievement, would be far more valuable to society than centralizing the sources of funds to pay for care, because then we’d know what we’re paying for.

While Federal mandates may smell to some like limits on personal liberty, more than 70% of American healthcare expenses are already not paid by patients themselves; 20% are subsidized by employers and 50% (or more in the case of citizens over age 65, families with children at risk and adults with special needs) are paid out of Federal and State government coffers. This means we are paying for each other’s care right now, and will continue to do so in one way or another.

When the ACA was passed, one of the elements of that seemed most offensive to critics was its most prominent feature: Essential Health Benefits. Yet, it is the “essential health benefits” feature that holds the greatest promise to help manage health spending. Here are a few of the common critical questions that were asked:

Why should I pay for maternity and newborn care if we’re done having children?

First, your insurance premiums don’t really pay for your expenses; they are put into a pool that is used for all its “members”. Some pay more than they use, some pay less; others contribute so that there is a chunk of money available to them in case of disaster.

So, here’s the thing: sick newborns, whether the result of nature or nurture, require extensive, expensive resources, special supports and services in school and can have lifelong disabilities. However, many of these problems are easily preventable through good prenatal and newborn care. While the disabled baby may not be yours, it could be your neighbors, or drain resources from your town fire department or your grandchild’s school system budget.

So, while you may see a small reduction in your insurance premium by being able to “opt-out’ of maternity and newborn care, you are going to pay anyway, and pay far more than the additional cost of that premium.

Why should I pay for preventive and wellness services I don’t want?

Whether through Federal or state tax dollars, or contributions to non-profit hospitals, we all pay for late stage cancers, heart attacks and strokes, depression, anemia and vaccine-preventable infections such as the flu or pneumonia. “Essential health benefits” reduce many of those late-stage and catastrophic costs, freeing up money for law enforcement, community services and better roads.

Eliminating essential health benefits may result in a short-term premium savings, but the economic consequences are substantial, especially as our society ages; the ACA resulted in an increase of 8,400 diagnoses of early-stage colorectal cancer among US seniors in the period 2011–13, saving hundreds of millions of your tax dollars which would have been required for late stage treatment.

Since we’re already paying a share of the costs of our fellow citizen’s medical problems, I want to make sure that my money is being spent well, or at least not spent unnecessarily. I can’t support the freedom to delay the diagnosis of colon cancer, acquire bacterial pneumonia, or go blind from diabetes or glaucoma; I can think of a few other things I would like my taxes spent on other than a completely preventable stroke and the subsequent physical and neurological consequences. These conditions put limits on freedom that go well beyond anything imposed by the ACA.

Improving the health of Americans is not really about coverage, but about increasing the use of preventive, wellness and chronic disease management services that were part of the essential health benefits. This is where the real, big league, benefits lie; but first we need to make up for lost time (and care) for millions of people with under-managed chronic illness. Only then will the overall cost of maintaining our health will go down; and, even they don’t, we will all just be healthier and live longer.

Source: CDC

Essential health benefits should not be viewed as an imposition, but a means to assure that our communities and our country has a better quality of health, which improves workforce productivity and economic vitality. Putting our lives at risk to defend our freedom is a fundamental aspect of American life, but this is not the same as letting people have the freedom to put their own lives at risk when the consequences, and their associated economic and social costs to us all, are completely preventable.

Steven Merahn, MD is a physician executive with experience in health policy, clinical operations and patient experience management. He is the Managing Director of Thinkwell Health and recently founded Union In Action, a non-profit focused on behavioral health integration.

This post originally appeared on Tincture here.

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Health in 2 Point 00 Episode 92, Takeover Edition | Louise Schaper, HIC 2019 Australia

Today on Health in 2 Point 00, we have another takeover edition! On Episode 92, Jess talks to Louise Schaper, CEO of the Health Informatics Society of Australia (HISA) at HIC 2019. Louise’s key takeaway from the conference is that health tech in Australia is focused on humanity and improving outcomes for all people. Jess also asks Louise about the Australian Digital Health Agency’s MyHealthRecord, an online summary of individuals’ health information. It’s got a great participation rate with 90% of Australians opted in, but it’s not being utilized as much as it could be. Finally, Louise debunks some of the chatter around HealthEngine’s data scandal in which they were caught sharing health data with law firms. The thing is, the press has sold it as if they have full access to your medical data and has sold that, but that’s not the case.

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How a Value Focus Could Change Health Care


How will the drive to health care value affect health care’s structure? We tend to assume that the health care structure we’re become accustomed to is the one we’ll always have, but that’s probably far from the truth. If we pull levers that incentivize the right care at the right time, it’s likely that many of the problems we think we’re stuck with, like overtreatment and a lack of accountability, will disappear.

A large part of getting the right results is making sure that health care vendors have the right incentives. All forms of reimbursement carry incentives, so it’s important to align them, to choose payment structures that work for patients and purchasers as well as providers. Fee-for-service sends exactly the wrong message, because it encourages unnecessary utilization, paying for each component service independent of whether its necessary and independent of the outcomes. Compare US treatment patterns to those in other industrialized nations and you’ll find ours are generally bloated with procedures that have become part of practice not because they’re clinically necessary but simply because they’re billable.

By contrast, value-based arrangements are really about purchasers demanding that health care vendors deliver better health outcomes and/or lower cost than what they’ve experienced under fee-for-service reimbursement, and the payment structure often asks the vendor to put his money where his mouth is, at least where performance claims are concerned. In a market that’s still overwhelmingly dominated by fee-for-service arrangements, one way for a vendor to get noticed is to financially guarantee performance. Integrated Musculoskeletal Care, a musculoskeletal management firm based in Florida, guarantees a 25% reduction in musculoskeletal spend on the patients they touch. This typically translates to a 4%-5% reduction in total health plan spend, just by contracting with this vendor, a compelling offer in an environment that makes it hard for upstarts to get market traction.

But the real power of possible payment reforms become clear when one considers how it might affect utilization, cost, and workforce patterns in medical domains that have been particularly out of control. Think about spine surgery, where good data exist to argue that half or more of procedures are unnecessary or inappropriate. What would happen if, in addition to tying payment to health outcomes, reimbursement for spine surgeries suddenly was no longer fee-for-service, but a capitated rate, meaning that a limit was imposed on funds that could be devoted to it?

  • Fewer surgeries would likely take place because there would be little or no financial benefit in doing unnecessary procedures,  plus any inability to show a positive impact on health outcomes in questionable cases. 
  • Spine surgeons’ caseloads would drop and incomes would fall. Some spine surgeons would retire or transition to other specialties.
  • The spine surgery market might quickly become very competitive. In an effort to win volume, spine clinics would quantify and then market their health outcomes and pricing, particularly to health plans and primary care practices seeking , preferred surgical providers.
  • Spine surgeons would become far more interested in approaches that consistently deliver better health outcomes and/or lower costs. Evidence-based medicine would find a much more receptive audience and treatments that have data showing they work would gain a following much more quickly than they do now. Non-operative treatments would become much more mainstream.
  • Spine surgery organizations with excellent performance would grow at the expense of their competitors and the variability of health outcomes would diminish. Centers of excellence would become much better established.
  • In general, costs of spinal surgeries would drop, possibly precipitously, and health outcomes would blossom.

Imagine the implications if similar payment reforms were implemented across all health care, impacting other niches with excessive utilization and cost, like cancer care and cardiovascular medicine. The workloads, numbers of physicians, and revenue base within each specialty would be reshaped, each one finding a new level.

In general, health care professionals who have become comfortable over the past several decades will find the new financial normal less to their liking than before. The winners here would be patients, purchasers, and primary care physicians who will benefit from market-based pricing and a greater reliance on true evidence-based care.

If risk-based arrangements get traction in ERISA health plans as they have in Medicare Advantage and Managed Medicaid, a health care market will take shape and strengthen. The kinds of changes I’ve described above will be increasingly prevalent. The question is whether employers and unions will finally insist that we pay for results rather than for activity.

Brian Klepper is a health care analyst and the EVP of the Validation Institute.

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Selling Your EMR Startup to Apple…Then Leaving Apple to Start-up Again | Anil Sethi, Ciitizen


Anil Sethi had the health tech exit every startup dreams about: a buyout by Apple. Not content to ride that unicorn into the sunset, Anil’s back at it with his new startup Ciitizen, which is another take on better a patient health record. What’s different? Why come back? Tune in for more and this and Anil’s great advice for other health entrepreneurs.

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The Rebellion of the Buyers


Did you catch that headline a few weeks back?

An official of a health system in North Carolina sent an email to
the entire board of the North Carolina State Health Plan calling them a bunch
of “sorry SOBs” who would “burn in hell” after they
“bankrupt every hospital in the state.”

Wow. He sounds rather upset. He sounds angry and afraid. He
sounds surprised, gobsmacked, face-palming.

Bless his heart. I get it, I really do. Well, I get the fear and
pain. Here’s what I don’t get: the surprise, the tone of, “This came out
of nowhere! Why didn’t anyone tell us this was coming?”

Brother, we did. We have been. As loudly as we can. For years.

Two things to notice here:

  1. What is he so upset about? Under State Treasurer
    Dale Folwell’s leadership, the State Health Plan has pegged its payments to
    hospitals and other medical providers in the state to a range of roughly 200%
    of Medicare payments (with special help for rural hospitals and other
    exceptions). In an industry that routinely says that Medicare covers 90% of
    their costs, this actually sounds rather generous.
  2. What is the State Health Plan? It’s not a payer,
    that is, an insurer. It’s a buyer. Buyers play under a different set of rules
    and incentives than an insurer.

Payers are not Buyers

That #2 is key: Insurers
are paying for your healthcare with your money, the premiums you pay them.
Under the Affordable Care Act their entire administrative cost, executive
salaries, and the profit for shareholders comes out of a strictly limited percentage
of the total cost. Think about that. The higher the total cost of the
healthcare they buy for you, the more money to go around for executive salaries
and shareholder profit. The more your healthcare costs, the better their bottom
line looks. How’s that for an incentive?

Buyers, on the other hand,
are paying for your healthcare with their own money and yours together. Self-funded
employers, union health plans, state health plans, pension plans and other
buyers pay the actual medical bills through a third-party administrator (TPA).
The higher the total cost of your healthcare, the worse their bottom line
looks. The lower, the better. If they can help you avoid an expensive
unnecessary surgery, or get it done at a provider that charges one fourth as
much, or help you get your expensive drugs at half the price or less, you will
be happier and so will they.

Buyers’ incentives are
closely aligned with their members, employees, and beneficiaries. As large
buyers buying for thousands, tens of thousands, or hundreds of thousands of
people they have the freedom and power to do something about those costs.

This has been the drumbeat
of my books, talks, columns, articles, YouTube videos, and tweets, for years:
The healthcare economy is hollow, inflated, and flammable, like the Hindenburg
approaching Lakehurst in a thunderstorm. What will set it off? A rebellion of
the buyers.

Analyze This

Can we analyze this for
just a moment? Bear with me for a little systems analysis.

Picture healthcare as a
complex adaptive system with multiple interdependent parts (hospital systems,
pharmaceutical companies, device manufacturers, government payers and
regulators, insurance companies and so on). Each part is busy taking in energy
(mostly money) from the other parts and putting out products and services, or
money to fund other parts. The input of each part is someone else’s output. The
more one part puts out, the more other parts can take in.

Each part is at a local
optimum. Picture this as a 3-D “fitness landscape,” where the height
of each part represents its “fitness,” its ability to survive and
prosper. In healthcare each part is on a tall mesa, that is, they have
optimized their position over time so that they are doing as well as they
possibly can in the system that exists. That’s why they operate the way they do
and make the choices they make.

Think about the people who
run each of these organizations. By definition, they are at the peak of their
careers. They got all their training and experience, and climbed the career
ladder to the C suite, by being excellent at the existing way of doing things
in an industry that has not changed its fundamental structure for 40 years or

Not all the mesas are the
same height. Some are doing very well, some not so well. But nearly all of them
see a wide gulf between where they are and any other higher level of fitness
that they might hope to reach, a gulf that is fraught with danger and unknowns.

This complex adaptive system
is stuck in a Nash equilibrium. That is, each player, doing as well as possible
for themselves in the system as it is, sees no advantage in changing the way
they do things. In every direction in this fitness landscape, any change they
make will see them and their organization climbing down off their mesa, their
“local optimum” into a lower level of fitness, into a valley of
uncertainty, into being beginners at this game.

Yet at the same time the
system is more and more unbalanced, with some mesas growing ever taller,
drawing in more and more energy from the other actors—the vast health insurers,
the increasingly consolidated healthcare systems, the world-girdling
pharmaceutical companies.

What Breaks the Stuckness?

So what moves a Nash
equilibrium off of its equilibrium? Either new sources of energy, new players,
or longtime players waking up to new energy and awareness and options. Today we
are seeing all three.

Think of yin-yang. The more
unbalanced the system becomes, the greater the energy driving any potential
instability. Any complex
adaptive system in an unbalanced state at a sufficiently high energy level will
resolve its potentials into a more-stable lower-energy state. The greater the
potential instability, the more likely the resolution will not be incremental
but sudden and catastrophic.

What’s that mean? It means
that the “burn in hell” guy is losing in this contest.

Why? Because of something
else we can learn from systems dynamics, which is this: This disruptive
resolution and rebalancing will come from the
system actors who:

  • are the most disadvantaged,
  • have unified
  • and have the greatest freedom of action.

Who am I describing? Where
do we find such system actors?


Not in the political realm.
In their nature, like Obamacare, attempts at reform mostly end up being efforts
to stabilize the existing system a little longer by taking the edge off some of
its inequities and arbitrary cruelties. So for instance the various proposed
reforms, even the most radical ones, are mostly just about making sure that
everyone is covered in one way or another. No mechanisms for actual cost
savings or elimination of rampant waste is contemplated beyond government fiat,
which has proven a slender reed on which to depend.

Not from the healthcare
providers, nor the insurers, the payers, who actually are mostly doing quite
well on their ever-exaggerating mesas in the fitness landscape, drawing in more
and more energy from the rest of us, and whose true incentives are to keep the
imbalance going and keep costs up.

It’s the buyers, who are professionally,
personally, and financially aligned with their members, beneficiaries, and
employees. They have traditionally been quiescent, unaware of their power,
without the knowledge, the strategies, the tools to take up their power, simply
paying the bills without questioning them. All it takes is for them to wake up.

And they are waking up.

Imagine Yourself…

Put yourself in their place. Imagine you are running one of these
entities, buying healthcare for tens to hundreds of thousands of people, in
charge of trying to keep that budget in line and those costs down. With all the
new pricing information coming out in various ways, imagine that you are
contemplating the fact that MRIs in your area may vary from $400 to $2200
depending not on quality but just on the site. Or you see hospital bills that
ring up a single bag of saline for $91 to $758 for no reason, for a generic
item that costs less than $1 to manufacture. Or you see, as we have seen
online, a young man with a rare genetic condition sharing his hospital bills on
the Internet. He requires an infusion that requires an overnight hospital stay
twice a month. His life circumstances have required him to move between states,
change insurers, and get treated at different centers. For the exact same
procedure with the exact same materials his insurers have paid from $3,319 to $20,736, while he has
co-paid from $222 to $4,261.

For no reason. If you have studied quality theory, you know that
variation for no reason is always a marker of damage in a system.

If you were a self-funded buyer, paying directly for medical care
for your employees or beneficiaries, what would you do when confronted with
these random absurd variations in cost for no reason?

You’d say, “I’ll take door number 2.”

You’d say, “Wait, who’s the chump here?”

You’d say, “This is bullshit.”

You’d say, “I will figure out what it takes to pay the lowest
price possible for high quality care.”

And that’s what’s happening
in 2019, facing 2020. The buyers are not buying the story anymore. They’re
saying, “Show us the goods. Show us:

  • The cost of the whole thing, diagnosis to rehab,
    whatever the package might be.
  • The appropriateness. Does this really need to be
    done? How do we know? Where are the real checks in the system?
  • The quality. How good are you really? Show us.
  • The real outcomes. Not metrics you choose for
    your marketing. Real metrics.”

Why now?

What’s different this year is that increasingly the tools they need exist, the strategies are there and tested, and there are insurgent vendors ready to show them how to execute on the strategies.

This year and the next are likely
to be a tipping point.

The huge cost of healthcare
is rooted in the way we pay for healthcare in a line-item, fee-for-service,
treat-to-code payment system. Fee-for-service is like taking your car’s bent
fender to an auto body shop and being charged for each sheet of sandpaper, each
can of Bondo, and each ounce of paint, instead of getting an overall estimate
and a single bill.

So I am telegraphing the
punchline here: Any serious and widespread attempt to substitute new and
different payment systems based on risk and true competition through
transparent bundled prices and quality of outcomes will implode today’s
healthcare market.

Here Comes Everybody

The North Carolina State
Health Plan is not isolated in its efforts. Similar stories are playing out in
Montana, Kentucky, and other states. Haven, the amalgamation of JP Morgan
Chase, Amazon, and Berkshire Hathaway, is just such a buyer with just such
incentives. Giant retailers like Walmart, Kroeger, and Loews, tech giants like
Apple, Microsoft, and Google, and many other large employers are waking up to
their power as wholesale buyers of healthcare. Buyers across the country are
using multiple strategies such reference-based pricing, bundled pricing,
medical tourism, cost plus caps, even onsite, near-site and direct pay primary
care. Consultants and other vendors are proliferating who are eager to help buyers
of any size, even small employers, map out these strategies. None of these are
yet majority practices across all buyers, but they are trending rapidly and
appear to be at a major bend in the curve of adoption.

The more buyers get up on
their hind legs and insist on their power as true customers, the faster that
change will happen. As more buyers experience and demonstrate that they can get
high quality healthcare for 10 percent, 20 percent, even 30 percent less in the
system as it exists today, the more other players in the system will have to
adjust, accommodate, change their pricing and cost structures, stop wasteful
expensive practices and focus on providing what their customers want, need and
are willing to pay for: real healthcare and real attention at a reasonable

Change is gonna come.  

Joe Flower has 40 years of experience in the healthcare world and has emerged as a thought leader on the deep forces changing the system in the United States and around the world.

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‘I Apologize for What You Are About To See’


The growing movement to include the patient voice in medicine through
Motivational Interviewing, patient-reported outcomes, social determinants of health
and shared decision-making

One day in 2011, as a part of my research on ways
to improve patient-provider communication about health behaviors, I was
shadowing Dr. G., a talented young internist with a cheerleader demeanor. He marched
through 12 afternoon patient appointments with confidence and purpose. But when
he saw the name of the last patient on her schedule, he turned pale, faced me
and said, “I apologize for what you are about to see.”

I must have looked confused. He repeated, “I
apologize for what you are about to see.”

We walked into the exam room. I’m not sure either
one of us knew what to expect. The patient, a white, obese man, was seated,
doubled over. He had a wad of paper towels jammed in his mouth. He threatened
to pull out his own, presumably abscessed, tooth. He refused to see a dentist
because he had no dental coverage, no money and no one to borrow money from. He
said he would use pliers to pull his tooth, but stayed put, rocking in his
seat. At the computer, the young doctor’s white-knuckled hand gripped his
mouse. Click. Click. Click. He searched the patient’s chart aimlessly for help.
Alerts kept popping up about the patient’s missing A1C results. It took two
minutes, but it felt like 20.

Dr. G. left the room and came back a few minutes
later. He gave the patient the name of a dentist who would see him at no cost.
I suspected Dr. G. had called the dentist and said he would pay for the
appointment out of his own pocket. The patient hugged Dr. G. He only wanted
help, and Dr. G. wanted to help. The tension was resolved for the moment.

The visit note looked like nice and neat, bearing
no resemblance to the interaction of human need I had just witnessed.

Problem list:

  • Diabetes Type 2
  • Major depression
  • Acute toothache

Note: “Patient complaining of tooth pain.
Referred to dental for eval of abscess.”

No mention of the patient’s many major stressors.
Lack of dental insurance. Poverty. Pain. Trauma. Anxiety. Possible addiction.
Obesity. Social isolation. The patient’s record said he was 39. He looked 59.
Not a single box in the patient’s EHR reflected those issues, despite the evidence that
behavioral health problems and poverty cost people 20 years in life expectancy.
There were years
of A1C test results in the man’s record. A lot of quality alerts related to his
uncontrolled diabetes and missed blood, eye and kidney exams. “Tsk, tsk, Dr. G.,”
the patient’s chart said. No wonder he dreaded this patient. When I returned to
the practice a month later, Dr. G. was gone, “promoted to an administrative

The patient’s non-medical self has not historically
had a place in the medical record. Dr. G., like many physicians, managed his patients
with complex behavioral health and unmet social needs by sticking them on his
schedule at the end of the day. Dr. G. felt he had to apologize for what I saw.
He seemed to feel I would judge him as harshly as his quality report would for
this patient. On the contrary, Dr. G reminded me of how many years of training
it took me as a psychologist to learn how to be at ease with the incredibly
uncomfortable feelings that come up in an interaction like the one I witnessed.

Dr. G.’s practice, like many others, had yet to reflect
the 40 years of accumulated evidence that supports incorporating the patient’s
voice and “the whole person” into medicine. Ideas such as:

  • Integrating behavioral health and social determinants of health (SDOH)
    into medicine
  • Motivational Interviewing to understand individual patient goals and
    barriers to care
  • Shared decision-making
  • Health literacy
  • Patient-reported outcomes

Each of these efforts inserts the patient’s voice
and social context into care. None of these ideas are new, but somehow it feels
like these evidence-based threads have finally woven themselves into a sail
that has recently caught wind.

This is a movement whose time has come. Listening
to the patient’s voice and story, understanding the patient’s needs and
priorities, and capturing that information in in data reportable to the
provider in the workflow—are becoming more common. In fact, we are seeing an unprecedented
surge of practices integrating patient-reported outcomes data (PROs) into their
workflows. Primary care practices increasingly are screening for behavioral
health and substance use, SDOH, environmental triggers for asthma, fall risk,
cognitive and functional decline, health literacy and hereditary cancer risk. Providers
want to activate patients around their individual barriers to care and
medication adherence. Specialists are incorporating PROs and considering that
data alongside clinical outcomes. They want to know which patients lack social
support and might therefore be readmitted.

Every day, my team is helping organizations
around the country implement patient-reported data and programs to increase
patients’ participation in their care. The goal is to improve not only the patient
experience, but also the provider experience with data that is actionable and
consumable, and that allows physicians to collaborate with a broader care team.
We are asked to find ways to maximize and extend the reach of the provider-patient
interaction beyond the 15-minute visit.

This is not a movement without ambivalence. As a
psychologist, I am keenly aware that most physicians didn’t sign up to be
psychologists and social workers. They are overwhelmed. Dr. G.’s patient is not
terribly uncommon.

I often wonder why this movement is taking off
now. I worked in an integrated adolescent primary care setting at Bellevue Hospital
in the 1990s, where I learned about Motivational Interviewing for substance
abuse interventions and shared decision-making for talking to adolescents about
birth control and HIV testing. These ideas have been around a long time, especially
in community health centers and public hospitals. Why the sudden explosion in
interest and broader adoption across medicine? Here are some of the major

  • Consumerism: Healthcare organizations lose money and payer contracts
    if they cannot attract consumers and keep their patient satisfaction scores up.
  • Value-based care, government and health-plan incentive programs:
    Shared decision-making, PROs, Motivational Interviewing and the integration of
    behavioral health and SDOH into primary care delivery have all been proven to
    improve outcomes and reduce the total cost of care.
  • A downward trend in life expectancy, notably among white males
  • Physician burnout: Practices are looking for ways to improve and
    humanize patient-provider communication.

Clearly, the movement to include patient-reported
data is here, and the patient’s non-medical self needs a place in their
healthcare record.

I apologize for what you are about to see. It is going to be extremely human.

Hilary Hatch is a clinical psychologist, the founder and CEO of VitalScore, and the VP of Clinical Engagement at Phreesia.

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Health Data Outside HIPAA: The Wild West of Unprotected Personal Data

Deven McGraw
Vince Kuraitis


This post is part of the series “The Health Data Goldilocks Dilemma: Privacy? Sharing? Both?”

“…the average patient will, in his or her lifetime, generate about 2,750 times more data related to social and environmental influences than to clinical factors”

McKinsey analysis

The McKinsey “2,750 times” statistic is a pretty
good proxy for the amount of your personal health data that is NOT protected by
HIPAA and currently is broadly unprotected from sharing and use by third

However, there is bipartisan legislation in front of Congress that offers expanded privacy protection for your personal health data. Senators Klobuchar & Murkowski have introduced the “Protecting Personal Health Data Act” (S.1842). The Act would extend protection to much personal health data that is currently not already protected by HIPAA (the Health Insurance Portability and Accountability Act of 1996). 

In this essay, we will look in the rear-view mirror to see
how HIPAA has provided substantial protections for personal clinical data — but
with boundaries. We’ll also take a look out the windshield — the Wild West of
unprotected health data.

Then in a separate post, we’ll describe and comment on the
pending “Protect Personal Health Data Act”.

The Rear-View Mirror
— Substantial HIPAA Protections, But With Boundaries

In 2016, HHS fulfilled its HITECH requirement to report on privacy and security issues outside HIPAA, issuing an extensive report to Congress: Examining Oversight of the Privacy & Security of Health Data Collected by Entities Not Regulated by HIPAA* (the “2016 HHS Report”).

The 2016 HHS Report described many of HIPAA’s safeguards –
for example:

“The HIPAA Privacy Rule
provides federal protections for individually identifiable health information
held by covered entities and their business associates and gives patients an
array of rights with respect to that information. The Privacy Rule protects
individually identifiable health information held or transmitted by a covered
entity or its business associate, in any form or media, whether electronic,
paper, or oral.”

The 2016 HHS Report noted: “While HIPAA serves
traditional health care well and continues to support national priorities for
interoperable health information with its media neutral Privacy Rule, its scope
is limited…”

The text of the Protecting Personal Health Data Act further quotes the 2016 HHS report:

“…entities not covered by
the privacy protections of (HIPAA), such as wearable fitness trackers and
health-focused social media sites, ‘engage in a variety of practices such as
online advertising and marketing, commercial uses or sale of individual
information, and behavioral tracking practices, all of which indicate
information use that is likely broader than what individuals would anticipate’”.

The 2016 HHS Report extensively describes five major areas
in which HIPAA’s privacy and security oversight and protections are different
than those of entities not covered by HIPAA (aka, non-covered entities):

  • Difference in individuals’ access rights
  • Differences in re-use of data by third parties
  • Differences in security standards applicable to
    data holders and users
  • Differences in understanding of terminology
    about privacy and security protections
  • Inadequate collection, use, and disclosure

(We’re also well aware of the criticisms of HIPAA’s gaps and
shortcomings, but for today let’s focus on the HIPAA glass being more than half

Out the Windshield —
the Wild West of Unprotected Health Data

Let’s explore the McKinsey statistics a bit more deeply: “…the average patient will, in his or her lifetime, generate about 2,750 times more data related to social and environmental influences than to clinical factors”. Here’s a break out the types and amounts of data generated over a person’s lifetime:

Social determinants of health &
health behaviors — 1,100 terabytes

Non-modifiable factors (e.g.,
genetics) — 6 terabytes

Clinical care — 0.4 terabytes

The hard drive of an average personal computer today can
hold about 500 MB to 1 terabyte of data. So, over their lifetime an average
person would fill up between 1,100 to 2,200 of today’s PCs with personal health
data. That’s a lot.

But more importantly, the data relating to social and
environmental influences is largely unprotected from sharing and use by third
parties. As we noted earlier, we believe the “2,750 times” statistic
is a pretty good proxy for the amount of your personal health data not
protected by HIPAA.

A recent NCVHS Report — Health Information Privacy Beyond HIPAA: A 2018 Environmental Scan of Major Trends and Challenges — provides examples of how diverse personal health data can be gathered:

“The number of potential
devices (personal or IoT) is enormous and increasing. Personal devices that
collect health information include thermometers, pulse oximeters, blood
pressure cuffs, clothing, belts, shoes, glasses, watches, activity monitors,
cell phones, and many more. Almost any type of appliance, fitness equipment,
camera, or other consumer product can become an IoT device with the capability
of recording and reporting personal information over the Internet. An IoT
device can collect data about activities, weight, health status, food
purchases, eating habits, sleeping patterns, sexual activity, reading and
viewing habits, and more.”

But wait…there’s more. Consider other ways that personal health data might be collected: 325K health apps, facial recognition technology, cameras, genetic tests, social media, intelligent personal assistant services such as Alexa, and many others.

Quoted in the NCVHS report, Law Professor Frank Pasquale
concluded that for health data outside the healthcare sector, “in many
respects, it is anything goes.”

Can the pending “Protecting Personal Health Data
Act” offer better protections? How would the Act affect patients and other
healthcare stakeholders? We’ll examine these questions in our next post —
“Health Data Outside HIPAA: Will the Protecting Personal Health Data Act
Tame the Wild West?”

            * Disclosure:
while Deven was at HHS, she contributed to this report

Vince Kuraitis, JD/MBA (@VinceKuraitis) is an independent healthcare strategy consultant with over 30 years’ experience across 150+ healthcare organizations. He blogs at e-CareManagement.com.

Deven McGraw , JD, MPH, LLM (@healthprivacy) is the Chief Regulatory Officer at Ciitizen (and former official at OCR and ONC). She blogs at https://medium.com/@ciitizen

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