Americans could do with new ways to save on healthcare. Obamacare-administered plans are set to get more expensive by up to 50% this year amid uncertainty around federal subsidies that help pay for premiums. The cost of employer-sponsored insurance, meanwhile, continues to jump well above inflation. Many of us are hit with surprise medical bills we can’t afford.
CoverUS, a startup, has one idea: Monetizing our health-related data. Through a new blockchain-based data marketplace, it hopes to generate revenue that could effectively make insurance cheaper and perhaps even encourage us to become healthier, thus cutting the cost of the system overall.
It works like this: When you sign up, you download a digital wallet to your phone. Then you populate that wallet with data from an electronic health record (EHR), for which, starting in January 2018, system operators are legally obliged to offer an open API. At the same time, you can also allow wearables and other health trackers to automatically add data to the platform, and answer questions about your health and consumption habits.
Why bother? To create a richer picture of your health than is currently held by the EHR systems, health providers, and data brokerages that buy and sell data from doctors, clinics, pharmacies, and other sources. By collecting all our data in one place, CoverUS wants to give us more autonomy over who uses our personal information and who makes money from it.
The health data brokerage industry includes companies like Iqvia, Cinven, and Veeva. They buy and sell anonymized data under the Health Insurance Portability and Accountability Act (HIPAA), as well as non-anonymous health data not covered by that privacy standard, including what you put into search engines and health websites. Drug companies use this data to develop new products and target treatments to particular doctors and hospitals based on prescribing patterns. The data mining companies are often criticized for being intrusive, but it’s arguable if their profiles are even consistently accurate. When a reporter for The Atlantic downloaded her file last year, she found that the data was missing a good deal of necessary information.
CoverUS, which plans to launch in the first quarter of 2018, will pay for the data we gather in the form of a fixed-price cryptocurrency called CoverCoin. Users generate coins by signing up and then sharing their data. The startup then hopes users will be able to spend the coins on services that improve their health (like gym memberships) or deposit them in a health savings account where the coins can be exchanged for insurance plan savings. Sealey says it’s in discussions with several providers.
Paying someone in crypto rather than real money sounds like a dodge but actually has practical benefits. For one, the value of transactions in the system actually goes toward making someone’s health better, not some unrelated purpose.
CoverUS, which won a recent blockchain for social good hackathon, plans to meet its own costs by charging for access to its membership and by issuing a separate “utility” token through an initial coin offering (ICO) later this year. This will give clients, including health researchers and advertisers, the ability to view patient data on a time-limited basis, much like they were using data pipes from Facebook or Twitter. (When individuals sign up for CoverCoin, they agree for their data to be used by third parties).
