Growth of the Data Economy in the Medical

Industry: A Literature Review

Author and Co-Authors Name: Brian Kim1
12
Student
12
University High School, Irvine, USA

Abstract: This article is a study on the medical industry and how its transition into the data economy will both
provide benefits for patients, physicians, and providers and carry unique challenges related to the use of patient
data. Medical research will be able to take advantage of a new scale of health-based data that can be explored, while
patients will benefit from the opportunity to review their own data and compare it to a wider sample. However, there is the
danger of a data breach, which is particularly important with data this sensitive. There are also privacy concerns from
individual patients and the costs that would be incurred by providers switching to electronic records. Companies can best
take advantage of the opportunities provided through the creation of electronic health records and application
programming interfaces that will allow third-party software developers to help users more effectively access and use their
data. Legislative action should also be taken to establish safety guidelines on personal data and help providers meet the
financial burden of the transition.

Keyword: Data economy, healthcare, digital economy, medical research, patient rights

I. INTRODUCTION
The formation of the data economy promises significant change for a variety of industries, including the
healthcare industry in the U.S. This research paper is a literature review on both the data economy and the healthcare
industry, with the intent of analysing the potential benefits of greater data integration of this industry and determining
appropriate measures to be taken both by healthcare companies and by the government that would promote greater
development to this end.

II. BACKGROUND

In its article “Data is giving rise to a new economy,” the Economist compares the role of data in the 21st century
to oil in the previous century: as an agent for change and growth in a new type of economy, the data economy. [1]
Rather than focusing on the movement of material goods, this new economy is based around the trade of digital
information, which is collected, traded, refined, and bought in fundamentally different ways than any previous market.
Perhaps the clearest example of this change is the content of new data. Historically, information, and even
digital information, have taken the form of databases of standardized information, such as names, ages, and genders
when used by governmental authorities. Today, much of the data that is the focus of the new economy is in the form
of streams, as raw, unfiltered, and non-standardized information from a variety of sources both in the physical and in
the digital world. This has led to a major shift in the data economy that appears at odds with traditional marketplaces:
much of the data being generated is not traded, or at least, not for money. The differences in data formats and sources
has made it, in many cases, prohibitively expensive and time-consuming for corporations to buy data and figure out
how to use it effectively. Instead, many of the companies with the greatest demand for data - Facebook, Amazon,
Google - are generating the data in-house. So far, these actors have indicated interest in the myriad possible uses for
data, particularly in the rapidly growing field of artificial intelligence.
Over the past decades, there have been significant changes in the economics of medicine, with changes in
payment, regulation, and technology for physicians. Technology is playing a potentially important role in measuring
the inputs of physician labour, a key consideration for insurance companies. This is a task that has become increasingly
difficult with the greater specialization that has accompanied healthcare [2].
 III. BENEFITS TO MEDICAL RESEARCH

The prospect of a data economy and greater data sharing is particularly important to fields of medical
research, which according to the Medical Law Review, are “increasingly cellular, longitudinal, fragmented, and
data-reliant”. [3] This is particularly true with genomic research, which has a built-in reliance on massive sample
sizes and metadata due to the focus on genetic differences in research. [4] Similarly, digital data collection
technologies allow for safer and more extensive research in humanitarian settings, particularly in setting where
major infectious outbreaks are being researched. As one researcher who worked in the Kono Sierra Leone during the
recent Ebola epidemic noted, “paper itself can be a transmission vector during infectious disease epidemics”. [5] In
addition, certain population-wide research projects targeting public policy concerns, such as obesity, are able to take
advantage of self-reporting online, which admittedly carry the risk of bias, since people might misreport numbers or
survey responders might represent a population more likely to care about their health. However, this does not mean
that such variations cannot be accounted for and measured against. [6]
However, the benefits of greater data sharing are apparent in all fields of medical science. As recently as
2017, a study published in the Journal of the American College of Cardiology looked into how frequently data from
the Digitalis Investigation Group, published in 1997, was used in other studies. As a point of comparison, it split the
timeline from 1997 to 2015 in 2009 when the National Institutes of Health’s Biologic Specimen and Data Repository
Information Coordinating Center (BioLINCC) made the data from the study more widely available. Based on an
increase in published studies that made use of the study’s data, the report concluded that “outside investigators have
authored a significant proportion of publications from the DIG trial and have been instrumental in harvesting the data”
[7]. This is indicative of the larger benefits of greater data sharing that a successful data economy would bring to the
medical industry, especially given the costs associated with research in recent years. Clinical trial costs, for instance,
have been sharply increasing, with the estimated average cost of bringing a drug to market increasing from $802
million in 2003 to between $1.3 and $1.7 billion in 2009 alone, though these numbers have been disputed [8].
These benefits have failed to materialize, in large part due to a lack of a standardized method of data sharing.
In 2012, a study in the Medical Law Review noted that “most data-sharing occurs on an ad hoc or project-grounded
basis, and much of it is reliant on personal relationships” [9]. In addition, a web survey from 2005 indicated that 51%
of a sample of geneticists in 15 different countries did not grant access to their databases to non-commercial entities
[10]. The problems with such a system should be apparent. With access to data this limited, researchers have less of
an opportunity to find information that might further their research. It also leaves less of a chance for researchers to
build upon the work of others after seeing possible expansions in the conclusions of others.
The nature of the data economy, as it grows to encompass the Internet of Things and new forms of biometric
data-gathering, also provides new opportunities for research. One example that is already seeing some use is through
wearable personal electronics, which are heavily used to monitor the health of the world’s elderly population [11].
Already, healthcare providers use similar data collection tools to create internal databases that their practitioners can
use when treating their patients. However, this carries similar risks to project-based data collection, in that there is no
guarantee that data would be shared between providers, or that the data in question would be usable due to different
formats.

IV. PATIENT TRANSPARENCY

The creation of a universal API would also benefit medical patients. The increasing value of medical data, as
well as the awareness of this data among medical patients, has led to increased demands for transparency of, and
access to, data generated through interaction with patients. These moves are directly related to the new nature of
medical data, which has grown alongside Web 2.0 and fostered patient-driven information networks online, such as
CarePages, Smart Patients, and Patient Opinion. These are connected to websites and social media platforms that
encourage user input and content creation and are indicative of a desire of today’s “digitally engaged patients” to have
more access to their health data [12].
 From an industry-wide point of view, the healthcare companies have already begun to move towards a more
well-developed data economy using electronic health records (EHR), which is defined as “an evolving concept defined
as a systematic collection of electronic health information about individual patients or populations. It is a record in
digital format that is capable of being shared across different healthcare settings, by being embedded in network-
connected enterprise-wide information systems. Such records may include a whole range of data in comprehensive or
summary form, including demographics, medical history, medication and allergies, immunization status, laboratory
test results, radiology images, vital signs, personal stats like age and weight, and billing information” [13]. Notably,
this is distinct from an electronic medical record, where information from a single encounter can be recorded, while
an electronic health record contains information from many or all health organizations where a patient has had an
encounter.
EHRs, and electronic records in general, have certain advantages over traditional handwritten records, mainly
in that they decrease the chance of an error arising from handwriting and they are easier to store physically. EHRs
also have “[the] potential to deliver a longitudinal record that tracks all medical interactions by a particular patient and
provide comprehensive data across populations,” which would provide the kind of large-scale, massive population-
based data that is becoming valuable in the modern data economy [14]. These advantages mean that EMRs have
already begun to see some use in the American healthcare market; in 2010, Kaiser Permanente successfully finished
implementing Kaiser Permanente HealthConnect, the largest private sector electronic health record in the world at the
time [15]. In 2017, the majority of ambulatory care practices (86%) and nonfederal acute care hospitals (95%) had
bought EHRs [16].
The use of patient data in such cases, while allowing for greater patient involvement in their treatment, also
invites greater transparency in medical treatment. If anonymous data is available to patients, there is more of an
opportunity for patients to compare their data with that of a population of other patients, giving them a more thorough
perspective on where their personal statistics fit in. It is entirely possible that patients might notice that they deviate
from the norm and bring up potential health issues that their doctors might miss, or even spot and correct errors in
their medical records [17].

V. CHALLENGES

A. Security

However, the advances that greater digitalisation of medical data would bring also carry certain risks. Chief
among them is the potential for personal patient data to be compromised or stolen, an issue that has become more
acute as the type of medical data collected becomes increasingly personal. IoT technologies such as wristbands and
pacemakers can collect information ranging from heart rate to location, all of which is incredibly sensitive. In
addition, recent data scandals at Facebook have shown that consumer data is not always afforded the protections that
they always deserve.
The greater danger, however, is in external breaches of health provider and hospital firewalls, such as in
2010, when a computer virus, despite a firewall and a country-wide antivirus platform, struck Kern Medical Center
in Bakersfield, California, leading to “16 days of agonizing recovery from a particularly vicious attack. The hackers
stuffed porn into the hospital’s computers, forced hospital printers to continuously print until they ran out of paper,
and eventually shut down a number of the Kern Medical Center’s systems” [18]. This resulted from a failure on the
part of a single employee, highlighting the dangerous weaknesses in such systems.

B. Privacy

There are also concerns with the built-in issues inherent to data-sharing, namely, the sanctity of patient privacy
and consent. These concerns must be weighed against the practical benefits of data sharing and a failure to properly
account for the needs of patients has historically been a cause behind a loss of trust in, and subsequent failure of, data
networks in healthcare.
 These kinds of concerns were behind the failure of a national data platform for healthcare in Denmark. Until
recently, the nation had the most extensive and long-lasting European health data program, called Dansk Almen
Medicinsk Database, DAMD (the Danish General Practitioners Database). However, it was ultimately abolished in
2014 over concerns about abuse of data. A 2018 research article in the journal Big Data & Society, conducted a series
of anonymous interviews based around largely open-ended questions, tracked the history of the program and came to
the conclusion that, in making the process of data generation as unobtrusive as possible for Danish physicians, the
creators of the program made it difficult for the physicians to keep track of how the data was being used. This
inevitably led to backlash when they found out that some data sharing had been authorized without the consent of
many physicians [19].

C. Costs

Healthcare providers also have financial concerns regarding switching to more integrated, digital markets.
Kaiser Permanente, the largest managed care organization in the U.S., took three attempts to create and successfully
integrate its own EHR before finally succeeding. According to the Harvard Business Review, the successful
implementation cost an estimated $4 billion [20]. These costs were incurred by software development, data transfer,
and retraining for doctors and nurses to make sure that they could use the EHR easily. This was also key to making
certain that the medical professionals associated with Kaiser would accept the new system.
Acceptance among professionals is something of an issue among “individual physicians or small practice
groups have particular concerns about the costs and learning curves associated with electronic records systems” [21].
While larger medical providers might be positioned to absorb retraining costs, smaller organizations will likely have
some difficulty transitioning.

VI. SOLUTIONS

A. Application Programming Interface (API)

As explained previously, there are concerns surrounding the issue of differing data types between different
healthcare providers. One suggested solution to this issue has been through the creation of a unified application
programming interface (API) to handle the different forms of health data entering the market. Commonly used in
software development, an API would provide a framework for outside developers to work with in creating applications
that could interact with health data. This would be especially powerful if linked to an existing platform, such as EHRs,
allowing patients and doctors to add and remove apps from EHRs, similar to smartphones.
APIs are already integral to products made by major tech corporations, with Apple especially benefitting, as
the company’s well-documented API makes it easy for third-party developers to create apps that smoothly integrate
with Apple products. Similar benefits could be brought to EHRs with APIs, allowing EHRs to “become commodity
components in a larger platform that would include other transactional systems and data warehouses running myriad
apps, and apps could have access to diverse sources of shared data beyond a single health system’s records” [22]. In
addition to the benefits to patients and physicians, this would also spur the creation of an actual marketplace
surrounding medical data within the safety confines imposed by EHRs, generating revenue for both third-party
developers and the companies that host the platforms.

B. Legislation

One way to incentivize companies to increase their efforts towards a greater data economy would be through
legislative action, something that Congress recognized and acted on in 2009 with the Health Information Technology
for Economic and Clinical Health (HITECH) Act, which established a payment system to reward companies that make
“meaningful use” of information technology, disbursing $34 billion by 2017 [23]. In 2016, this was followed up by
the 21st Century Cures Act. Both of these have helped push companies to adopt EHRs, but more capital should be
expended on helping smaller providers retrain and acclimate to these technologies, as the acceptance and widespread
use of EHRs and similar technologies will be as critical to the creation of a health-based data economy as initial
development.
The Meaningful Use program was another government initiative aimed at API development. The 21st Century
Cures Act requires that IT products certified by the Meaningful Use program must have an API that allows health data
to be used “without special effort”. However, the program suffered from the fact that “although the Meaningful Use
program was predicated on the emergence of interoperability, the necessary incentives and penalties weren’t in place
to produce it” [24]. The government now needs to put more focus on encouraging API development in the healthcare
industry through greater reward systems.
Legislative safeguards and certification programs on data networks would also serve to establish guidelines on
protecting patient data. The regulations on data security established by European Union in May 2018, the General
Data Protection Regulation (GDPR), were created to address data concerns, and due to early drafts would have placed
severe restrictions on data usage for research purposes. However, after intense lobbying from the research community
and further revisions, with a result that is “a good example of political engagement by researchers and their advocates,
and a sensible and informed response by policymakers” [25]. Such efforts show that it is possible to legally balance
data privacy with the academic and commercial value of data.

VII. CONCLUSION

For the healthcare industry, taking greater part in the data economy carries significant benefits. Medical
researchers can take advantage of the staggering scale of data now available to advance medical care more effectively
and more cheaply. Patients can also benefit as their data is more open to review and comparison and can take a more
active role in their treatment, filling gaps that professionals might not be able to fill independently.
However, such data also means that the risks associated with a data breach are that much higher. The security
of personal data will be a constant concern, as will patient consent, as some individuals will probably feel
uncomfortable allowing their data to be released to the world. On the provider side, health care providers might have
qualms when confronted with the costs of developing the necessary software, such as EHRs, and retraining physicians.
At the moment, the healthcare industry should focus on greater adoption of EHRs and, to complement this
shift, the development of APIs, which will make it easier for patients, physicians, and third-party developers to more
fully take advantage of the anonymous data that is provided. Government action is also needed, as financial incentives
will likely be necessary for some services to make the somewhat costly switch over to the data economy.

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