Big Data in Healthcare

Big Data in Healthcare: Unrealized Potential

An omnipresent buzzword, “big data” is currently having an enormous effect on the healthcare industry.  Providers and insurance companies are attempting to utilize big data to further understand their patients and lower costs while other companies see opportunities in helping them do so.  While challenges remain, this phenomenon is having a dramatic effect on how providers and consumers experience healthcare.

Providers

Providers are coming around to the potential in big data.  “I find this to be incredibly exciting.  The real power is to be able to use the data to make decisions,” says David Feinberg, chief executive of UCLA Health System.  Providers are utilizing big data in an attempt to decipher macro trends that can help them target their efforts and lower costs.  The goal is to move the approach to healthcare from reactive to proactive.  Providers are using big data to identify “high-risk” patients and create coordinated care plans in order to manage costs.   Providers are also focusing on lowering readmissions with Medicare readmission penalties increasing (totaling $227 million in the latest round).   In addition, providers are experimenting with new approaches to better serve these high-risk patients. Some enterprising doctors are putting personal data trackers on their patients in an attempt to collect pertinent and timely data. 

Insurance Companies

Insurance companies are using big data in an attempt to better understand their patients and nudge them toward healthier behavior.  Insurance companies such as Humana argue these efforts are mutually beneficial as patients will become healthier and insurance companies will realize lower costs.   One example of insurance companies harnessing big data to better understand patients is the building of evidence-based personalized care plans through electronic medical records.

New Opportunities
The Affordable Care Act has created opportunities and incentives for companies to harness big data in an attempt to bring down healthcare costs.  Companies such as Google see financial potential in utilizing the increasing amounts of data collected to make healthcare more proactive.  While regulatory burdens may prove challenging, companies are finding opportunities by providing PHI solutions.

Challenges        

While the potential is great, all healthcare industry parties face challenges in effectively implementing big data strategies.  As new big data healthcare apps and products are rushing to market, complaints arise that the FDA is too slow to regulate and controversy remains over what the FDA should and should not regulate.  Others retort that FDA oversight is crucial in ensuring consumer safety and confidence. Debate rages over whether the government is slowing or promoting innovation.   An additional concern is that providers and companies need time to amass sufficient data and it can be difficult analyzing the results to create a coherent strategy.  Finally, privacy concerns will continue to hinder hospitals and companies.  In order to successfully utilize big data in healthcare, companies and providers will need increasing and continuous amounts of patient information to glean details regarding their lifestyles.  Due to the sensitive nature of health information, these efforts may be stymied by privacy advocacy groups and government regulations.


Michael T. Putnam is a Senior Associate at Triage Consulting Group in San Francisco, CA. He has a B.A. in International Relations, with a minor in Business, from the University of Southern California.