Intelligent Health Networking

Changing our way of healthcare

Michael Georgeff

Michael Georgeff

CEO, Precedence Health Care and Director e-Health Research Unit Monash University Australia.


The fundamental reason for the healthcare IT gap, and the lack of impact of ICT in healthcare relative to other industries, is that we are attempting to use an ICT framework that is mismatched to the new models of care.


Meeting the complex needs of patients with chronic illness is one of the greatest challenges facing medical practice. If we are to improve outcomes for these patients, the evidence strongly suggests that we rethink our approach to ambulatory care.

With better disease management, hospital admissions for chronically ill patients could be reduced by 50%, with consequential improvements in quality of care and reductions in mortality and morbidity. Information and Communications Technology (ICT) focussed on better sharing and utilisation of knowledge is the key to achieving this change.

In Australia, for example, it is estimated that improved knowledge sharing and care plan management for patients with chronic disease would produce direct healthcare savings of over US$ 1.5 billion a year. The savings in non-healthcare costs (such as travel, special foods and carer expenses) are estimated to be the same order of magnitude. And increases in workforce participation and productivity could add a further US$ 4 billion per year in benefits to the economy.

However, while many healthcare providers now have clinical desktops and other computer systems, these cannot communicate with each other. Doctors often do not know what medications and tests have been given to patients by other doctors, even when they are members of the same care team. It is even more difficult to bring relevant medical knowledge to the point-of-care, to create integrated care plans, to monitor a patient’s progress against the care plan, or to alert care providers when a patient’s condition requires intervention. The Economist has referred to this as “Health Care’s Outrageous IT Gap”.

My view is that the fundamental reason for this gap, and the lack of impact of ICT in healthcare relative to other industries, is that we are attempting to use an ICT framework that is mismatched to the new models of care.

There are two key characteristics of healthcare that should drive the type of ICT solution we consider. First, we need to take seriously that the fundamental business of healthcare is knowledge: knowledge of the patient, knowledge of medical treatments and practice, knowledge of the healthcare system and knowledge of the prevailing environment. This knowledge is extensive and complex, is continuously changing, must be shared among many providers and consumers, and must be brought to bear at the right time, in the right context, at the point-of-care. Second, we need to be fully aware of the inherent complexity of healthcare: it is composed of a variety of participants, highly heterogeneous systems and practices, highly autonomous and independent agents, and highly distributed information sources and services.

In such a business environment, there are three keys to success: (1) the knowledge enterprise, (2) connectivity and (3) open networks of businesses and users.

The Knowledge Enterprise

The knowledge enterprise is one in which the key resource is knowledge, compared to an industrial enterprise where the key resources are physical assets and labour.

As is clear from the rapid emergence of companies like Google and Amazon, and the transformation of the music and retail industries, knowledge enterprises are driving quite profound structural and qualitative changes in the way we live and work.

However, despite the knowledge-intensive nature of healthcare, the business model we use in healthcare organisations is still based on the industrial enterprise. This is characterised by a focus on physical components, big players to get economies of scale, detailed planning, standardisation, stability, and locked-down, tightly integrated computer systems.

The aim has largely been to move from what is seen by many from an inefficient “cottage industry” to a more efficient industrial enterprise. This approach may be suitable for running hospitals but it will not work for managing and preventing chronic illness across the continuum of care. Here, the organisations and people involved use different systems, different practices, different data and different processes. The type of care is also different: it requires continuous care surveillance, with reminders and alerts sent to the right people and followed up with the right intervention at the right time.

The organisations and information technologies used in healthcare must adapt to match this business environment. Instead of the industrial model, which may work within a hospital setting, we need business models and technologies that are typical of knowledge enterprises such as Google, Amazon and Skype.

These knowledge enterprises are characterised by networked information, support for autonomy and personalisation, and use of information systems that are open, adaptive and distributed. Not many are thinking this way in healthcare. We are still planning, standardising, and “locking in” the big, centralised information systems. These kinds of systems, such as being rolled out in the UK, require massive investments between 5-10% of annual healthcare expenditure.


The second key is connectivity. In the period of the information economy (1970 to 1995), competitive advantage lay with investing in crunching power: large applications that could process Moore's Law: the performance to price ratio of computing doubles every eighteen months.

But for the knowledge economy (from 1995 forwards), raw computing power and large monolithic applications are not the keys to success. Here competitive advantage accrues to those who invest in connecting power: connecting to more people and more systems to share knowledge faster and farther. The prevailing law is Metcalf's Law: the value of a computer is proportional to the square of the number of connections it makes. The key message: don’t spend time getting agreement on the data, don’t spend time ensuring all the systems conform—get connected.

In businesses today, most high priority and high volume communications are handled electronically. Yet in healthcare, these high importance communications—such as referrals and hospital discharge summaries—are usually transmitted using paper and pen, fax, letter and hand delivery. This state of affairs would be inconceivable in almost any other industry, let alone one that rests so fundamentally on knowledge and its sharing across the supply network.

Once connected, individual value propositions will drive stakeholders towards agreements and standards, continuously increasing the value of the data in an evolutionary way. The need to understand the flow of information will drive faster adoption of standards, in a virtuous cycle of increased information flow, improving standards and increasing value.

However, this is not where we have focussed in healthcare. Instead, most investment has been directed at the development of large, closed monolithic systems. The Electronic Health Record (EHR) is almost universally seen as the key to better knowledge sharing in healthcare, but instead it is the connectivity of the players that is the key. It is the information flow that is important, because from that everything else derives. Without it—without the connectivity to populate and to access health data—an EHR is very difficult to build, maintain, and operate.

Open Networks

Thirdly, we need to design our systems to accommodate the heterogeneity and incompleteness of information, the distributed and diverse nature of the information sources and users, and the various forms of autonomous and governed institutions and businesses that are part of healthcare. Instead, the conventional approach in healthcare can largely be characterised as an attempt to remove the heterogeneity and autonomy from the system, so that it can better run like a well organised bank.

The prominent example of a system built to accommodate heterogeneity and autonomy is the Internet, and there are two keys to its success: (1) connecting anything, anybody, anywhere, and (2) divesting investment and control of the network (and its services) from a central authority to suppliers and users.

If we go back to the beginning of the Internet, in the early 1990s, we see that it was radically different from the prevailing information systems at that time. As Tim Berners Lee, the founding father of the World Wide Web, said in 1991: “Its universality is essential: the fact that a hypertext link can point to anything, be it personal, local or global, be it draft or highly polished.” This was highly radical at the time, where uniformity, accuracy and completeness of information were considered an essential part of computing.

The Internet was also designed from the beginning to have no central authority and to operate “while in tatters”. While initial government investment was essential to provide the core infrastructure, the Internet’s huge growth has cost the taxpayer little or nothing, as each node is independent and has to manage its own financing and its own technical requirements. This allowed a mix of government and private investment, new applications and services to “plug in” and add value, and new and innovative technologies and business models to rapidly evolve.

These three key factors—the knowledge enterprise, connectivity and open networks of businesses and users—have transformed the retail, finance and music industries, and are starting to transform film and television.

We need to do the same in healthcare. We can begin by connecting providers and consumers across the continuum of care and making existing systems interoperable using Internet technologies. We can begin by sharing what we have. We can begin by living with existing business processes, without impinging on the time or practices of healthcare practitioners.

Once connected, and with the right financial incentives in the right places, individual value propositions will then drive greater electronic data entry, agreed data models, and an increasing diversity of care management and decision-support services. Consumers, together with professional healthcare organisations, will drive evidence-based care and practice change. And this in turn will create new business models and opportunities for hospitals, insurers, employers, healthcare providers and businesses.

It will take money and partnerships between government and industry to get started. It will take different ways of collaborating with and building on the conventional operational systems of government-run health departments.

But with the right conceptual framework—by taking seriously the knowledge enterprise and the autonomy and heterogeneity of care providers and consumers—we can start to transform our health practices.