How the Apple Watch Could Help Revolutionize Health Care

The next big political fix for our ailing health care system should be to get out of Silicon Valley's way.

Before the Apple Watch was revealed on September 9, it was rumored to include several biometric sensors that could track the vital signs of the person wearing it. The first iteration of the device turned out to be disappointing in this regard: It has only a heart rate monitor. But future iterations of the watch will likely track our body temperature, glucose levels, tremors, oxygen, and hydration, helping patients stay out of the doctor's waiting room.

This is just one of many promising ways in which Silicon Valley is poised to remake the monstrously inefficient health care industry. But can the tech industry stop the government from strangling its emerging ventures?

Take the Palo-Alto based company Theranos, founded in 2003 by Stanford University sophomore Elizabeth Holmes. It's developed a new approach to phlebotomy that involves a simple finger prick. The company uses software to test a single drop of blood on the spot at prices that read like they're written on the menu board above a deli counter: Checking cholesterol levels costs $2.99. A glucose-tolerance test runs $8.85. Looking for the presence of a cancer antigen sets customers back $14.31. Holmes, now 30, tells the story of a diabetic who recently had several tests performed by Theranos for $34 that otherwise would have cost the insurance company $876.

Clinical labs like Quest Diagnostics, which booked $7.1 billion in revenues last year, aren't the only firms that need to watch out for Theranos. Patients don't need to bother with insurance companies when a test costs just $2.99. Holmes, whose board of directors is packed with former high-profile government officials, is passionate about changing federal health laws to empower consumers. In February, Theranos scored a victory when the Department of Health and Human Services issued a new rule allowing patients in all 50 states to view their lab results without involving a doctor.

Other ventures aim to help patients make use of all this health data. Curious, a health technology firm cofounded by Linda Avey (who also helped start the personal genetics firm 23andme), will start beta testing a new platform in November that synethesizes genetic information (collected by 23andme), microbiomic profiles (collected by a startup called uBiome), personal traumas and life events that users will enter manually (such as a fight with a spouse), and (eventually) biometrics collected by wearables such as the Apple Watch. It will then analyze the information in a way that helps users determine what's helping, causing, or exacerbating various ailments and conditions.

The company's cofounder and Chief Technology Officer, Mitsu Hadeishi, compares Curious to other peer-to-peer tech companies like Airbnb and Uber because customers will "anecdotally share things" with each other and the software will utilize its network to "look at patterns on a larger scale." As an example, Hadeishi cites reports that eating the root black cohosh helps mitigate hot flashes. Through Curious, users could track the treatment's effectiveness and share their experiences with other users. If black cohosh helps some participants and not others, the software would look at other aspects of their health profiles that might explain the difference. "It's not just people randomly saying things on message boards," says Hadeishi.

Ultimately, clinical studies will be necessary to establish links between treatments and outcomes, and Hadeishi sees Curious' software in part as a "hypothesis generation source." In the past, clinicians could come up with broad theories about what works simply by observing their patients, but in the future doctors need to develop treatments tailored to subsets of patients based on their unique physiologies, so patterns are harder to detect. Tools like Curious' software could help scientists develop testable ideas.

Medicine is in part about solving mysteries, and eventually Curious' software (or similar products by other tech firms) could be much more effective at diagnosing problems than high-priced specialists. Yet Curious, like any company seeking to enter this space, has to look out for the Food and Drug Administration (FDA). Companies don't need the agency's approval to market products that track and share raw information on patients, but they get into trouble with the FDA when they try and make "predictive claims," says Paul Howard, the director of the Manhattan Institute's Center for Medical Progress. Last November, the agency forced 23andme to pull its $99 personal genome test off the market for giving customers too much information about the implications of their test results.  

Curious is walking a fine line in this regard, and the FDA could force the company to submit to an expensive approval process that would likely put it out of business. (Curious has raised about $900,000 in seed funding to date.) But Hadeishi says he's fairly confident that his product won't require FDA approval, and he's been in touch with staffers in the office of the U.S. Chief Technology Officer—a position created by President Obama to cut red tape—who are "aware of the types of things we want to do" and "want to find a way to accommodate innovation."

Another way for patients to make use of all the health data available to them while avoiding costly and time-consuming office visits is through the burgeoning field of telemedicine. Doctors on Demand, which the Mercatus Center's Robert Graboyes wrote about recently in Reason, offers users 15-minute online video chats with physicians for a flat fee of $40—or about the price of a co-pay to visit a doctor's office under many insurance plans.

The Palo-Alto based HealthTap offers a similar service, with unlimited calls for $99 a month (plus $10 additional per family member), and participating physicians will call in prescriptions and examine physical symptoms photographed with a smartphone. A current limitation is that providers can't check a patient's pulse or temperature through a video call—but biometric data-gathering devices could change this, making telemedicine considerably more useful. A less surmountable limitation are state laws dictating that a physician licensed in one state can't treat a patient in another. 

In its efforts to Uber-ize health care, Silicon Valley's biggest challenge will be convincing states to repeal competition-killing licensing laws and working with the FDA to let software eat its way through our antiquated, expensive, and labor-intensive approach to patient care. There's reason for optimism: In recent years, the tech industry has become far more adept at navigating the regulatory terrain in Washington. The next big political idea to fix our nation's health care system should be to get out of the way.