Whose data are they anyway?

What a difference two days make!

First, T-Mobile in the UK informed the Information Commissioner’s Office that some of its own rogue employees had sold on the firm’s contract customer data to third parties. These third parties then ring the contract customers just before their contract expiry to offer deals that may or may not be kosher, or the best deals on the market.

So exactly what data might a mobile network operator hold on a contract customer? These data include the customer’s name, address, date of birth, and bank account details or credit card details for collecting bills. A credit check is also run before contracts can be agreed. While the identity of the said “third party” is unclear, there is of course no compensation for any mishaps. So much for our famed data protection code that prevents more things from happening than it enables!

A day later, Iceland’s deCODE Genetics filed for asset protection under Chapter 11. The firm’s customer testimonials include one from Dorrit Mousaieff, Iceland’s first lady. The firm offered personalized DNA testing through its deCODEme website too.

Under Chapter 11, deCODE is now looking to sell its assets. These “assets” include the genetic data of 140,000 Icelanders. And DNA samples of an undisclosed number of customers, their identification details, possibly the reports of the analyses conducted on the DNA samples. All held under contracts which prevent the sharing of the data or the information with third parties such as insurers etc. But will that hold when one contracting party goes bust? Who is the custodian of that contract? Who will uphold it and what recourse exists for customers whose DNA and data are hanging in the balance?

Meanwhile, it was reported that a credit card processor in Spain was being investigated for enabling a major credit card scam. The scam has affected over 100,000 cards in Germany. While their credit card contracts protect them against fraud, someone will end up paying for it. Depending on where the PCI-DSS compromise is found and how the liability is established, any or more of the players in the payment value chain – the issuer, the acquirer, the processor, the retailer or the customer – may end up suffering the real monetary loss.

Note the commonalities? All three industries are highly regulated but so different from one another that one may be tempted to ignore any possibilities of transposed learnings. Two major themes emerge:

  • These incidents point to some of the many complex challenges that unite otherwise disparate, highly regulated businesses: customer data ownership, data security, privacy breaches, liability, recourse and compensation.
  • They also illustrate while human beings – employees, third parties, contractors, service providers – remain the weakest link in data protection, the more fundamental questions are often missed. These could be related to the business’s survival and how regulatory complexity may mean that resolving data breaches is not really straightforward.

As a large number of consumers sit in limbo in fear of their data falling into the wrong hands, it has to be asked: When the custodians fail, who protects the consumer?

These test cases will all provide fascinating insight and may well set the precedent. Not least set the stage for the essential reform to remove all the unnecessary information that businesses insist on collecting from customers, when they have no way to guarantee the security of the data.

Healthcare Services Outsourcing to India?

This post emerged from a question asked by a friend on LinkedIn. The question was:

Are (sic) Healthcare services outsourcing from India the next big opportunity? Health-insurance companies based out of the US are giving the option to customers, to get their surgeries / medical procedures done from Indian hospitals. Is it now time to give healthcare outsourcing its due?

The question fascinates me on several fronts. I work with India investors interested in several sectors, including Outsourcing. I also work with investors keen on biotechnology and pharmaceutical sectors. In addition, I work in comparative health policy which, with my strategy hat on, I cannot help but frame in the context of the comparative advantage of nations.

As an investment opportunity, Healthcare Services Outsourcing (HSO), which also goes by the names ‘medical tourism‘, ‘health tourism’, ‘medical travel’ etc, is a no-brainer. If an investor from Britain or America wishes to invest in facilities in India that cater exclusively to economically well-heeled but health-wise, down-at-heel patients from developed countries, the returns are easy to make. The case is not hard to make from the perspective of the 3Ps of healthcare – payer, provider and patient.

The economics stack up pretty easily from the payer’s perspective although I think there is a divide between private sector payers, such as insurance companies and public sector payers such as the UK’s National Health Service (NHS). Take it with a pinch of salt, if you will, but here is an interesting ‘ready reckoner‘ of relative costs and waiting times in the NHS with those in India. The comparison does not include the cost of poorly understood risks, of corrective action when things go wrong and the cost of any adverse impact on future healthcare premia.

At least to some providers, the risks are manifestly clear. In the recent days, the UK’s NHS, which is also a payer, is asking patients to pay for corrective surgery after elective surgeries abroad go awry. For an opposite perspective – how costs to NHS add up when un-entitled foreigners abuse its free-at-the-point-of-delivery health service – see this short video from Sky News.

From the patient’s perspective, the prospect of reduced waiting times is enhanced often by the possibility of an exotic holiday in a two-fer. Not just that, patients can often get treatments which are rationed or otherwise unavailable from their provider such as obesity operations not easily available on the NHS.

The business model “HSO as medical tourism” is therefore easily fundable. The question is – in Guy Kawasaki’s succinct words – here: it is fundable, but is it viable? From the perspective of comparative advantage of India as a nation, one needs to ask: is it sustainable? Let’s examine this a bit.

India has a sufficiency of factor conditions such as good, English speaking doctors and now good infrastructure to deliver advanced surgeries and treatments. That is an attractive proposition on its own for HSO providers and seekers. But as far as domestic demand conditions are concerned, Indians carry a disproportionate burden of diseases such as malaria on the one hand, and diabetes and heart disease on the other. So there is a need. But a considerable number, estimated between 15% and 25%, remain in extreme poverty, so the purchasing power is curtailed. “HSO as business model” focuses on the factor conditions but sustainable comparative advantage for India will arise from not its relatively smaller magnitude factor conditions but also its considerable demand conditions.

The experiences of doctors in India, working on the coalface are instructive – on the one hand, about the larger failures of public health policy and practice in India, and on the other, about their value as intensive learning or potential for ‘knowledge transfer’, if you will.

Much discussion was generated by a BMJ editorial, titled Poor Countries Make The Best Teachers. My response was:

“… a doctor in the United States, who had trained in India, told me an anecdote that shows the flipside of Byrne’s experience on elective as a medical student in India, a learning experience she described as second to none. In a lecture during my acquaintance’s residency, she noticed that her professor and other residents were puzzled by the x-ray film of a boy’s limbs. They could not identify what could possibly have been wrong with him. The doctor, who had seen much rickets in India, identified it correctly and to the amazement of her colleagues. Poor countries, sadly, still provide reasons to train Western doctors in diseases that may not afflict the West right now but, with mass scale migrations, could easily become a problem in the future.”

What does this mean for investment opportunities? Well, a lot, if we think differently about HSO.

* A better, scalable and sustainable investment would lie in raising the profile of the usefulness of training doctors from developed countries in India. This will enable doctors from developed countries to understand, diagnose and treat better those diseases, which were hitherto geographically confined or eliminated, but are now resurgent and truly ‘globalised’, thanks to travel and mass migration.

* In return, the doctors from developed countries could teach the Indian doctors about innovative methods such as advanced surgical techniques, give equipment and test kits, as well as help with public health programmes particularly expanding capacity and service delivery.

* Indian healthcare system, in turn, could invest some of the profits to provide essential preventative services and public health programmes to its poor populace. India’s main factor conditions, the doctors, could therefore become not just financially better off but also more influential stakeholders in this healthier future for all.

How is that for a model for healthcare services outsourcing?

Yes, I know this is not a fashionable view. But it certainly is the most sustainable way to go forward where good health and access to good healthcare is not the privilege of the few ‘haves’ but the fundamental right of the many ‘have nots’.

As for why I am arguing a case to reduce the primacy of the potential of “HSO as medical tourism” model, I prefer to let Cicero explain that.

“The man who can hold forth on every matter under debate in two contradictory ways of pleading, or can argue for and against every proposition that can be laid down – such a man is the true, the complete, and the only orator.”

Over to you, and Santé!

Related reading:

Credit crunch and public health

Health and the Indian Economy – one of my guest posts on the Indian Economy blog

The world’s front-office? – an old post examining India’s outsourcing industry

New York Times says Uninsured Put a Strain on Hospitals. How about ‘Poverty and inadequate access to healthcare puts a strain on human beings’ for a title?

Credit crunch and public health

It is no longer a case of the banks and the bankers, although popular media headlines will still have you believe that the crunch was purely of the banks’ making and somehow they should pay for it. It is now closer to home.

Not only has lending dried up, the housing market has ground to a halt. The fantastic drops in the stock market mean many have seen their life’s investments and wealth wiped out in a matter of days. Those close to their pensions are hit the hardest, as the bottom drops out of their equities-reliant pension pots, but not all understand the impact. Suffice it to say that it is not just us younger people who will pay for the bailouts all our lives, but it is also people approaching retirement, many of whom may have to continue working.

As a result of loss of wealth, people are spending less, even in the growing BRIC countries which were supposed to be able to absorb the shock. However the growth in these countries depended hugely on their customers in the West, ergo, crunch time. Jobs are not just being lost in the value-added services sectors but also those in retail and in other sectors. This hits consumer spending power even more as people sit tight on their money.

It is unlikely that our health will remain untouched by the upheaval. 

Early research by the charity, MIND, suggests that debt and the spiralling cost of food and other essentials is affecting mental health of many adversely. It is not just the relatively poor, but also the formerly well-paid professional workers who are feeling the stress, and it is being termed the ‘Square Mile Syndrome’. Insomnia is reportedly on the rise too. However the evidence of the linkages between such macro-economic problems and suicide rates is mixed. A longitudinal study of Australian data suggested that there are gender and age related differences. It was seen that male suicide rates increased with markers of economic adversity, while the opposite pattern was seen in females. Age-stratified data showed that higher housing loan interest rates having a positive association with suicide in younger people and a negative association in older age groups. Indeed, during the Great Depression of the 1930s, suicide rates rose significantly, and fell with the improvements in the economy and reduction in unemployment in the 1940s. 

Is there no sign of hope? There may be some.

As some of you know, my other interests include Obesity and weight management, which was the case study of my research for 4 years. 

Last year I wrote a review of a paper on the lessons from Cuba’s experiences with the prolonged economic crisis of 1989-2000. Researchers from the Johns Hopkins Bloomberg School of Public Health, Cienfuegos, Cuba, and Loyola University observed the impact of population-wide weight loss due to sustained reductions in caloric intake and an increase in energy output. They reported that during this time, obesity declined, as did deaths attributed to diabetes, coronary heart disease and stroke.

Reviewing the paper then, I had written:

“This is truly a unique – if unreplicable and unfortunate – experiment. The lessons serve to strengthen further the literature on the benefits of weight loss and the association between obesity and ill health. However from a practical perspective, the study does not add much.

Finding a way to reduce population-wide caloric intake and increase population-wide physical activity is the holy grail of obesity policy. The success of such initiatives depends largely on individual effort and initiative. Recent developments include incentives and disincentives from the payer in the healthcare provision industry.

However unless we are motivated to improve our own health, which is not really happening, the holy grail shall remain a mirage, which gets further as we chase it.”

I may yet eat my words (pun unintended, but entirely suitable).

If we are in for a prolonged period of economic recovery, we may gain an inadvertent benefit with slimmer bodies, and a lower rate of diabetes, coronary heart disease and stroke. 

* The second half of this post is strictly tongue-in-cheek. However if we cannot keep a sense of humour alive and try to stay resilient, it is unlikely we will come out unscathed from this credit crunch. We are all in this together, for a change from America to China and all in between.

Obese Britannia

With our love of junk food of both the fish-and-chips and McDonald’s varieties and our loathing of exercise, and despite our best intents, we in Britain are slip-sliding our way to Obese Britannia.

Want to know our secrets? Click to read today’s post on my Obesity blog.