The Real Motivation for Microsoft HealthVault & Google Health?

I think I must be simple minded. 

Since Microsoft launched its HealthVault beta on October 4, I’ve had no trouble finding opinions on whether or not the service is viable.  A representative sampling can be found here, here, here, here, here, and here though a simple searchwill return many, many more.  By the way, did that last one actually suggest that the potential of private health information “leaking out” of HealthVault might be a good thing since the threat of this might motivate people to live healthier lives?

Similarly, Google and other traditional IT powerhouses who are not usually identified with healthcare IT are apparently planning their own entries into this market and have been for some time.  Many people have written about this too. 

The central element of the debate seems to focus on privacy and security and whether or not John Q. Public will (a) trust the security and privacy settings of a service like this and (b) be self-motivated to spend the time to enter all of their own historical private health information.  The privacy and security questions are certainly reasonable today.  I know this first hand as a provider of a SaaS application for administering healthcare benefits which includes merchant capture of online payment of insurance premiums.  The need for maintaining security,  ensuring privacy, and complying with the HIPAA and PCI regs/rules/standards play a huge role in many of our decisions — impacting our application and database architecture, our code, our data center architecture, our daily data center operations, our customer support operations, and more.

Is it possible though that Microsoft, Google, et al. don’t really care whether or not John Q today trusts them enough and is self-motivated enough to use their system(s) right now?  Is it possible that they have a different motivator?

If you’ve not been paying attention to the 2008 US Presidential Race, a few minutes on Gallup.com will show you that many Americans seem to think that healthcare reform is a critical issue in this presidential election.  In one of my earlier posts, I also mentioned that one of our potential capital partners recently asked me to review and discuss the healthcare reform position papers of each of the major presidential candidates.  Clinton’s plan for example says the largest savings in her plan will come from “modernization,” and she sites a RAND (R. Hilletad et. al.) 2005 study titled “Can Electronic Medical Record Systems Transform Health Care? Potential Health Benefits,”which she says claims that improving healthcare IT can save Americans $77 billion annually.  If we look at Obama’s plan, one of his primary points is “Lowering Costs Through Investment in Electronic Health Information Technology Systems.” It goes on to say “Obama will invest $10 billion a year over the next five years to move the U.S. health care system to broad adoption of  standards-based electronic health information systems, including electronic health records.”  A major tenant of Edwards’ plan says it will “Improve Productivity with Information Technology”  Again, the first concept in this section of Edwards’ plan is “Adopt Electronic Medical Records.”  Interestingly, Edwards sites the same RAND study as Clinton, though he says this same study says that, “Savings from electronic records could be as great as $160 billion a year.” 

Here’s the point, if a Democrat is elected president in 2008, each of the major candidates claim that the #1 cost saving measure they hope to implement is a universal electronic medical record.

Microsoft and Google won’t need for John Q. Public to willingly choose to use their system if the US government decides that they get to play a part in implementing a universal electronic medical record.  If we look back just a couple years to the UK’s National Programme for IT in the National Health Service, Microsoft and Google were left out of one of the all time largest IT deals.  The original cost estimate for this project was 2.3 billion GBP.  This estimate has officially been updated to 12.4 billion GBP, but rumors apparently have some estimates as high as 20 billion GBP (that’s about $40 billion USD).  The companies that got to play in the UK deal were traditional Healthcare IT providers like Cerner and IDX and large systems integrators.  If Obama will publicly admit while running for president that he’s prepared to spend $50 billion to implement a universal electronic medical record, we can be pretty sure the actual cost will be much higher.  I think Microsoft and Google are rushing to get systems to market as soon as they can so they can attempt to play in what may be the mother of all IT deals.