Sunday, July 31, 2016

Uber For Health Won't Play Nice

People talk "Uber for health care."  After all, Uber has been wildly successful, valued over $60b, which makes it bigger than Ford and GM.  AirBnB, the Uber of hotels, is worth some $20b.  Heck, even the disposable razor industry has its own Uber, with Dollar Shave Club just getting acquired for $1b.  Any industry that isn't looking in its rear view mirror for potential Uber-type competitors may find itself disrupted into irrelevancy.

And, goodness knows, health care could use some disruption.

There are no shortage of candidates for health care Ubers.  Telemedicine and other on-demand services are often cited, with such companies like TeleDoc, American Well, Heal, Pager (which was founded by an Uber co-founder), or MedZed.  Some offer video calls with nurses and doctors, some even offer in-home visits.  Accenture predicts over $1b will be invested in such companies in 2017.

Other Uber candidates include the dozens of health start-ups that are based around mobile apps, including not just on-demand services but also services like appointment scheduling (ZocDoc), chronic condition self-management (Glooko), even therapy (TalkSpace).  Not to be left behind, we supposedly have Ubers for blood draws and home health.

Uber itself is dipping its toe into health, with UberHEALTH offering flu vaccinations and rides to medical appointments,

Not everyone sees an Uber impact on health care, at least not yet.  Rick Bates, writing in TechCrunch, warns not to expect an Uber in health care anytime soon, He notes the "unrivaled" regulation in the space, the importance of trust, and the limits on choice that consumers have.  Uber may have changed consumer transportation preferences in a short time, Mr, Bates says, "but in the realm of healthcare, there are too many regulations, constraints, and basic laws of human behavior to overcome."

Similarly, Rock Health, while detailing the "uberification" of health care through on-demand services, cautioned that "the unit economics are far more challenging for on-demand health care versus other on-demand sectors, with transportation as an example."  They argue that technology adoption in health care is driven more by reliability and price than novelty and convenience.  As a result, "the path to bridging a successful on-demand business is likely to be longer and more complex than originally hoped."

Both the proponents and the skeptics have valid points, but we may be missing the point.  Uber wasn't looking to break into the taxi industry, and the Uber of health care won't be looking to break into the health care system.

Uber didn't care about the taxi industry's restrictions.  It views itself as a technology company, not a taxi or even a transportation company (although they are starting to be regulated more like the latter).  They didn't seek to buy a fleet of cabs, nor did they worry about getting regulatory approval for its drivers or what they charged customers.  They just started using their technology to match riders and drivers, figuring they'd deal with the regulatory backlash once they were too firmly entrenched to easily get slapped down.

I.e., they didn't try to fit into the rules.  They knowingly broke them.

Most of the start-ups that claim to be a health care Uber have still ended up being part of the health care system, just adding consumer-convenience through better technology.  They're playing nice, usually eager to make deals with hospitals, physician groups, and/or payors.  That is, after all, where the money is, and it is easier to try to grab a slice of the $3 trillion we're already spending than to invent a new industry.

But that's not what Uber did.  They didn't go to the taxi companies and offer to spiff up their technology.  They didn't go to the taxi regulators and suggest changes to the regulations.  They created a new industry, one that only resembled the one they were supplanting in that both exist to get people from point A to point B.

In some ways, a better example of disruption than Uber may be Napster.  Its founders didn't want to fit into the music industry, and weren't even trying to get rich from their idea.  They just wanted people to be able to share songs, and they succeeded far beyond anyone's expectations  That their idea almost brought the music industry to its knees was beside the point.

That's what could happen to health care with a true disruptor.

Napster was shut down, but iTunes was born out of its premise, and has been a huge success, as have Google Play, Spotify, Pandora, and others.  They've fundamentally redefined how we buy and listen to music.  Neither the record labels nor the musicians are crazy about these new worlds, nor are they making as much money, but that is what happens when an industry is disrupted.

An Uber or a Napster of health care may not use doctors, or it may not abide by state-based licensing restrictions.  It may not care about health care's arcane coding languages: diagnosis and procedure codes, place-of-service modifiers, etc.  It may not care about FDA approvals or importation restrictions.  It may not care about health insurance, with all its many regulatory requirements, benefit provisions, and capital needs.

In short, it may not look or act like anything else that currently exists in the health care system.

People like to point out that health care is different from other industries because we entrust our lives to it.  We need to trust what care we're getting and from whom we're getting it.  That is, they say, very different than getting a ride or downloading a song.  That may be true, but it is also true that far more people are killed from medical errors than from automobiles, so the health care industry shouldn't be too complacent about its "unique" role.
The health care industry shouldn't be looking in the rear view mirror for its Uber or Napster.  They won't be on the same road.  They'll be coming from the side, or in the air -- from someplace that the industry isn't expecting, isn't looking at, and may not even initially recognize

That's how we'll really know when health care has its Uber.


  1. Imagine, for example, peer-to-peer prescriptions. People already share unused Rxs and drugs brought from other countries with friends and family. Just add some slick technology and, voila, Napster for Rxs. No need for a prescription or a pharmacy, and not limited to FDA approved drugs.

    The medical-pharma industry would no doubt try to shut it down, but high U.S. drug prices and rampant use of prescriptions for off-label purposes weaken their position.

    It might not be as safe as we'd like, but it could happen.

  2. Uber for healthcare is....Uber.

    One of the issues in healthcare is getting patients to show up. Having Uber available to get patients to and from appointments from the scheduling web page could reduce the no-shows for appointments and blood draws. For value based care, this could be huge as getting the patient to show up is the first step to compliance.

  3. The disruption of healthcare will be through wellness programs. Someone will create and market a comprehensive Wellness program that incorporates and/or elimenates PCPs and uses specialists more like precision instruments than routine check ups.
    It will be done through the 100-500 employer sphere because costs impact them the highest and they can afford to invest in their employees. They also have the freedom to spend healthcare dollars as they wish due to Obamacare exemptions for self insured.

  4. I agree with Ehsomizze, and with Dr. Lane Sebring in Wimberley, TX -- The future of medicine is Not Medicine, it's Health. Even Benjamin Franklin knew that, "an ounce of prevention is worth a pound of cure." But medical schools don't teach health. They instead teach medical care: how to diagnose disease and treat symptoms. That will/must change, and those who resist by spending twice as much as the military industrial complex to protect their $3.3 Trillion/year revenue stream, will see their business models collapse. (See