Power To The Health Data Geeks : Shots - Health News There's a gold rush on in health information technology. Entrepreneurs and venture capitalists are betting on companies that aim to help consumers, insurers and providers save money.

Power To The Health Data Geeks

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LINDA WERTHEIMER, HOST:

A computer programmer and a child in a Batman suit walk into a pancake house - sounds like a joke. But now that programmer has a new product to bring to market and he may strike it rich. Venture capitalists think there's a lot of money to be made making health care more efficient. They've poured more than $2 billion into digital health startups just this year. That's according to the venture capital firm Rock Health. But Eric Whitney reports that while programmers are on the case, they need a lot more information to make a real difference.

ERIC WHITNEY, BYLINE: Remember back in April when Medicare released that huge database of how much it pays individual doctors? No? Plenty of software engineers like Dave Vockell in San Francisco do.

DAVE VOCKELL: Like all great health care breakthroughs, it began at the International House of Pancakes.

WHITNEY: Vockell was excited because Medicare was releasing information it had kept under wraps for years - how much the government health plan for senior citizens pays each doctor for each service he or she provides. Medicare dumped an entire year's worth of data, finally making public millions of transactions. Vockell knew that information could be really useful for Medicare uses but he wasn't sure exactly how. Enter the IHOP.

VOCKELL: My kids go there after school one day for funny face Tuesday pancake lunch, and I had been with them. And I was like, there's lots of seniors there. And my kids run around. And the seniors love when they came up and sit with them. I was like, I could totally use my kids to source a whole bunch of interviews pretty fast.

WHITNEY: Sure enough his 3-year-old in a Batman suit proved a great icebreaker. And over a lot of pancakes, 43 seniors told Vockell that knowing for the first time ever which doctors charge more and less wouldn't necessarily send them on a shopping spree for the lowest price. Seniors generally like their doctors and don't want to shop for new ones. That was the first thing he learned.

VOCKELL: Two was I know I have some procedures on the horizon that I don't exactly know exactly what they mean that I have to do or what they're going to cost me. I'd love to get some insight into that. Three was - could you make the print really big? And number four was the blueberry syrup is magnificent.

WHITNEY: So Vockell came up with a website that helps seniors understand the procedures their doctors are recommending and the costs to help them have the conversation they've always wanted with the doctors but didn't know how to start. And they can print information out on paper in really big type. It's too early to say whether lyfechannel's product will be the hot new topic on the shuffleboard circuit but it was a winner at the big Health Datapalooza conference this month.

(SOUNDBITE OF ARCHIVAL RECORDING)

UNIDENTIFIED SPEAKER: The grand prize winner and team that will be taking home $20,000 for their fantastic work is lyfechannel with smart health hero. Come on up.

WHITNEY: Big health care data is the raw material for a whole new segment of the IT sector. Entrepreneurs like Sean Power are exploiting the rich information in databases like the price list Medicare released this spring.

SEAN POWER: Yeah, that's hot. So anytime anybody releases a new data set we get excited.

WHITNEY: Power's company Karmadata is based on the idea that software engineers like him can find ways to use big data to save the government or big companies money and that they'll then share some of that savings with him. He says health care is so bloated and inefficient that there's tons of opportunities to streamline it.

POWER: It's a great time to be starting a company in the health care database - yeah I think that the gold rush is on.

WHITNEY: And just like a real gold rush, hitting pay dirt means lots of prospecting. The Medicare data is a rich vein, but entrepreneurs can't always find the information they really need to make a truly useful app. Dr. Omar Alvi is with the start-up called Accordion Health, their big idea is to help families estimate their health care spending. So you can type in that grandpa's got hypertension, mom has diabetes and one of the kids has asthma, and then get some idea of how much all that's going to cost and maybe even shop for the best price. A great idea, but Alvi says...

OMAR ALVI: Each patient is very different, so in order to make a meaningful prediction you have to have a lot of data so you can say patients just like this went through these problems as they moved through the medical system. So that's really going to require hundreds of millions of data points in order to pull out meaningful information.

WHITNEY: And not even close to the millions of data points Alvi's company needs are available yet. A lot of information about procedures, costs and effectiveness remains locked up inside insurance company computers or in hospitals and doctors medical records, information they don't want to share. Software entrepreneurs say the Medicare data release in April was monumental and that the more big databases geeks can get their hands on, the more breakthroughs they can come up with to make health care leaner and less expensive. For NPR News, I'm Eric Whitney.

WERTHEIMER: This story is part of our reporting partnership between NPR and Kaiser Health News. This is MORNING EDITION from NPR News.

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