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By Joe Flower
Got a Safeway card?
It is also full of discussion, even heated arguments, If you do, then the Safeway grocery store chain can over who owns this valuable information. Whether infor- know as much as it wants to know about whether you mation gathered outside of medical channels, through like Skyy vodka, whether you buy Pampers in the super electronic scanning and cross-characterization of databases family box, and whether you go for organic foods. among retailers, distributors and manufacturers, becomes subject to HIPAA restrictions is a regulatory question of What about the pharmacy at Safeway? They know if Talmudic complexity. But big money will be weighing in you are taking birth control pills, or AIDS drugs or anti- on the side of using the information commercially.
Imagine that distributors, device manufacturers and No big deal? No big deal—your pharmacy has always pharmaceutical companies gain direct, case-detailed known this information, and besides, they are covered access to your patients and potential patients. Imagine by Health Insurance Portability and Accountability Act that you run a respiratory clinic, or a sleep center. (HIPPA). They can’t just sell that information, or trade it Imagine your patients receiving e-mails or postcards, individualized to their case, from someone else across But let’s take another step here and see how new town, saying that they can provide the service better, technologies can shift power structures and business faster or cheaper. Your crosstown rival received this infor- mation from their suppliers—a pharmaceutical company, We have had bar codes for 30 years. They carry a device manufacturer, or a distributor—as part of a joint UPCs—Universal Product Codes —that identify the prod- uct. So every Safeway can know how many Diet Cokes Does this seem farfetched? Health plans are already and Foster Farms Frozen Chicken Thighs they have up to their elbows in the massive job of restructuring sold—and so can the distributors and manufacturers who their entire business models around just such deep, The new thing is RFIDs—radio frequency identification Of course, health plans do not need to derive the chips. They carry EPCs – Electronic Product Codes—that fact that Mr. McNally has asthma. They just need to slice identify not just a product, but whatever particular object and dice that information. And they are exceptionally you put them on, whether it is a truck, a pallet, a carton, or eager to find ways to use that information to hold down an individual item like, for instance, a bottle of pills. costs. They express their eagerness in their investments: RFIDs, with the suitable infrastructure of hardware Aetna, for instance, is spending about $300 million per and software, allows the industry to track individual items year, and United has spent over $2 billion in the last from manufacture right to end user. It will likely soon three years on business intelligence infrastructure.
be possible for the distributor or manufacturer to know If it is not already true, it soon will be true that the not just that the Rite Aid at Fifth and Main sells 47 pack- health plans know more about your business than you ages of Ventolin per week, but that Mr. McNally refills his do. Any hospital CEO worth her salt can tick off exactly Ventolin prescription every 52 days, on average.
which doctors bring in the most business. But every doctor incurs costs as well—sometimes huge Business intelligence
costs as the hospital expands or acquires new equipment to meet the doctors’ needs—and few hospital executives could The health care industry is full of articles, presentations tell you which doctors bring in the most profit. and research papers about how useful this information will Hospital charges are clear enough, but they are most- be, how it will streamline distribution, lower costs, and ly based on air and hand-waving—most hospitals could keep down tampering, diversion and counterfeiting. not really tell you what the average cholecystectomy costs 54 SEPTEMBER • OCTOBER 2006 THE PHYSICIANEXECUTIVE
THE PHYSICIANEXECUTIVE SEPTEMBER • OCTOBER 2006 55
The health care world is increasingly being
driven by information—not data as mass
quantities, but data deeply processed to extract
mass customized meaning. And in this world,
the providers are information-poor.
Joe Flower is a nationally known
building the new online world for health care executives, the Healthcare Futures Exchange. He can be reached 54 SEPTEMBER • OCTOBER 2006 THE PHYSICIANEXECUTIVE
THE PHYSICIANEXECUTIVE SEPTEMBER • OCTOBER 2006 55

Source: http://net.acpe.org/Resources/PEJ/2006/September_October/Articles/Flower.pdf