Digiceuticals will Save US Healthcare

Published: Sep 12, 2017   |   1249 words with about 6 minutes reading time   |   ©2022 by Bob Smith
Category: Technology   |   Tags: Digiceuticals Healthcare mHealth pharma


Liberate the Records

Healthcare missed last century’s e-commerce revolution. More computers at point of treatment have digitized almost all health records, but they remain locked in platforms stored with different formats inhibiting free exchange. Emancipating electronic health records (EHR) from these virtual prisons is a critical step for an industry desperately needing the benefits of e-commerce. Healthcare may be the only industry still using fax machines to exchange printed EHR.

Expanding consumer options beyond brick and mortar and other restraints is how e-commerce disrupted every other industry in the last century. Likewise, opening EHR to free exchange creates a new value chain shifting medicine from patient-centered to customer-centered models demanding outcome based services. These conditions open the door for an Amazon or Uber type transformation of public health quality and economics.

Tailwinds to EHR Free Exchange

Law and regulation see EHR access as a right, encouraging the industry to act with increasing clarity and resolve 1. HIPAA, passed in 1996, mandated regulation and enforcement of EHR patient access by agencies under The Department of Health and Human Services (HHS). Additional law and regulation increased specificity and sharpened teeth reinforcing and asserting patient EHR administration imposing significant non-compliance penalties. The Cures Act, passed late 2016, mandates for a national application program interface (API), an EHR format translator between different systems, available within one-year.

The industry is also acting. Fast Healthcare Interoperability Resources, FHIR®2 is a developing EHR exchange API sponsored by the industry consortium HL7®. Starting in 2014 and building on previous HL7 standards, the FHIR project indicates general release in 2018.

Policy without teeth is just a mission statement. HHS has acted, for example fining a large healthcare provider $4.3 Million for blocking patient EHR access3. In another instance, HHS fined an EHR vendor $155 Million for false interoperability claims4.

mHealth at The Gates

At the end of 2016, there were 259,000 mobile health applications (mHealth) deployed on market places from 58,000 publishers5. When this force of creativity connects to clinical environments fully interoperating with EHR, a wave of disruptive new treatments will appear.

Digiceuticals are clinician connected and artificial intelligence (AI) supervised mHealth applications treating patients as alternatives to legacy drug and in-office treatments. Applications already exist that coach patients through insomnia. Allowing clinicians and systems to access the data allows rapid adjustment with faster and more enduring outcomes.

Digiceuticals greatest potential lies in preventative precision medicine. IoT and wearables capturing vital signs monitored and analyzed by AI will predict the onset of conditions, like strokes, early enough to intervene.

Reimbursement is the End Game

Within a decade, clinicians will prescribe Digiceuticals. The supply-chain for these applications looks much like pharma but with direct to patient virtual fulfillment.

US prescription drug spend tops $309 billion annually and is the fastest growing category at 12%. 6 In contrast, the entire mHealth market is just $12.5 billion and almost none of it covered by insurance. Coverage will grow the mHealth market attracting billions of R&D dollars. This development will create a burst of unimaginable Digiceuticals and public health outcomes as profound as the vaccine or antisepsis.

Pharmaceutical companies are the best positioned to get Digiceuticals into the complex medical distribution channel for prescription and use. More importantly, all evidence points to unique skills at driving reimbursement. As if needing an additional inducement, supporting free EHR benefits other critical pharma bottom-line business functions like clinical research.

Without action soon, pharma could look like Tower Records and other fast followers who considered irrelevant the massive category distribution expansion brought on by the iPod and Apple Music Store.

Security is the “Key”

Of all civilian industries, health information is the least tolerant of security and privacy breaches. EHR breaches can be life threatening with consequences impossible to price into the cost of doing business like other industries. Even the IoT and wearables segments aren’t immune from risk as Abbot labs7 recently discovered vulnerabilities in their pacemakers requiring FDA action. Therefore, clinician and patient confidence in EHR privacy and transaction security is the most significant factor for Digiceuticals to take hold.


These will happen:

The pivot point looms dangerously near to a customer-centered value-based fee for outcome market disrupting the last legacy industry.


  1. Electronic Health Record (EHR) Statutory and Regulatory Background Summary of Relevant Policies 1996 (HIPAA) The Health Insurance Portability and Accountability Act (Public Law 104-191 Directs U.S. Dept. of Health and Human Services (HHS) to administer and codify the act (45 CFR Part 160 and Part 164, Subparts A and E) including:

    • Appoints HHS Office for Civil Rights (OCR) responsible for regulation administration and enforcement.
    • Protects all “individually identifiable health information in any form or media.” (45 C.F.R. § 160.103.)
    • Grants consumer rights to records (45 C.F.R. § 164.524)
    • Defines consumer right to amend, correct or complete records. 45 C.F.R. § 164.526.
    • Sets civil penalties $100 to $50,000 or more per violation with an annual cap of $1,500,000 and criminal penalties of up to $250,000 and up to 10-yrs imprisonment. 2009 (HITECH)The Health Information Technology for Economic and Clinical Health Act (Public Law 111-5)
    • Provides HHS with additional authority to establish programs to improve health IT including EHR exchange.
    • Establishes the Office of the National Coordinator for Health Information Technology (ONC).
    • Authorizes ONC to define interoperability standards, certify technologies, and provide funding to support use of certified technologies.
      2015 (MACRA) Medicare Access and CHIP Reauthorization Act (Public Law No: 114-10)
    • Requires clinicians to attest to not participating in information blocking.
    • Strengthens (HHS)ONC authority to set standards
    • Requires patient EHR access via Application Programming Interfaces (API)
    • Established Quality Payment Program incenting or penalizing providers based on service quality and effectiveness. 2016 (Cures Act) 21st Century Cures Act (Public Law 114–255) HHS is still shaping policy and regulation, the act contains:
    • Charges HHS(ONC) to further improve EHR interoperability and security
    • Requires annual report on interoperability and blocking
    • Strengthens consumer right to access, use and EHR sharing
    • Encourages consumer-directed EHR sharing to support research
    • Published within one-year, a national API defining security, audit-ability and deeper data interoperability,
    • Subjects entities who knowingly “interfere with, prevent, or materially discourage access, exchange, or use of electronic health information” to fines up to $1 million per violation

  2. Fast Healthcare Interoperability Resources FHIR® 

  3. Cignet Health Fined a $4.3 Million Civil Money Penalty for HIPAA Privacy Rule Violations 

  4. eClinicalWorks and certain of its employees to pay $155 million to settle False Claims Act suit 

  5. research2guidance’s MHEALTH APP DEVELOPER ECONOMICS 2016 

  6. American Hospital Association, Trends in Hospital Inpatient Drug Costs: Issues and Challenges, October 2016 

  7. Firmware Update to Address Cybersecurity Vulnerabilities Identified in Abbott’s (formerly St. Jude Medical’s) Implantable Cardiac Pacemakers: FDA Safety Communication 

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