
Google Health launched yesterday to give patients a simple way to maintain a personal health record. It will probably fail, despite Google's billions and drugstore partners, because physicians have no market incentive to share information.
To understand the problem, let's first put a human face on it. The photo above is our mom, a cancer patient being admitted to Dartmouth-Hitchcock, one of the best hospitals in the United States. The procedure was about her 25th at this hospital, yet she was asked to fill out a form listing past surgeries and current prescriptions.
Mom is sharp, but she takes about 30 pills a day and her body has more scars than an Iwo Jima vet. If her surgical success depends on her personal memory, well, that's not a great idea.
Now we won't go off on the stupidity of this; Dartmouth is a fine hospital and is simply doing what physician groups do around the United States -- using isolated information systems that don't talk to anyone outside the walls. The problem is physicians have reason not to share.
You see, hospitals are just like the United States Postal Service. USPS makes a lot of money from some customers (businesses who ship packages) and loses a boatload of cash on others (Aunt Ginnie who needs letters delivered in rural Oklahoma). Physician groups have the same customer value issue. They make a huge profit from some patients (knee replacement, bariatrics) and lose money on other patients (inner city emergency care). Hospitals have to provide both levels of service, so it is vital that they attract lots of high-profit patients to offset the losses elsewhere.
Sharing information via a personal health record would disrupt that model. What happens to a surgeon who "owns" your personal records if suddenly those records are easily transported to any other expert in the country? Think how much the competing surgeon groups would love to have a quick, complete history of your health.
And this, dear patient, is why unified health records do not exist in the United States.
There is hope. Other industries, finance in particular, have built unified views of customers because they realize sharing information outweighs the costs. Your credit score is a perfect example of every lender and transaction being recorded instantly and shared, to help banks offset the risk of giving loans to deadbeats. But this system only works because the market benefit -- avoiding risk -- outweighs the market cost -- giving away competitive information.
Pharmacies are the first to start building unified records; MedCo and RxAmerica have partnered with Google, because the unified view of a patient could make ordering pills a lot safer. But hospitals and physician groups still have little incentive to join. The only hope is that some hospital somewhere will realize giving patients control over their information may be a competitive advantage -- a new way to help that sets them apart.
For now, Google Health invites consumers to upload and manage their own information. Good luck remembering that tonsillectomy, and downloading the file to your surgical team next time you're bleeding in the emergency room. We love Google's initiative and hope it succeeds. But the reality is for many years more, your docs will ask you to fill out a form.
Google CEO Eric Schmidt gives a brilliant view of the problem here:



















