Don't let it get away!
Keep track of the stocks that matter to you.
Help yourself with the Fool's FREE and easy new watchlist service today.
Do you know where your health data goes? Whenever you go to the doctor, are admitted to a hospital, or pick up a prescription, your personal health data is being recorded. If you think that data stays within the walls of your health care provider, think again.
Interoperability is the name of the game for health care organizations these days, particularly with provisions in Obamacare that encourage exchange of health data. Should you be worried that your health data is possibly flying in many directions?
An investigation conducted by The Washington Post last year gives cause for alarm. Research found that the health care sector is more vulnerable than most other industries to cyber theft.
The Department of Homeland Security echoes this conclusion. DHS officials say that health care data faces real prospects of being targeted by hackers, criminals, or even terrorists.
Wired magazine recently interviewed Shawn Merdinger, security researcher at the University of Florida. He particularly expressed concern with the potential for unauthorized access to data loaded to the Internet from medical devices such as fetal monitors. "It's really scary stuff," according to Merdinger.
These fears don't appear to be overblown. Data breaches impacting more than 21.4 million patient records have been reported to the U.S. Department of Health and Human Services since August 2009. Most involved theft or loss of data, however, rather than hacking by cybercriminals.
A study by the Ponemon Institute found that 94% of health care organizations have had at least one data breach in the past two years. 45% reported more than five data breaches, up from 29% in 2010.
Increasingly more organizations across the health care sector look to move data to the cloud (i.e., storing data on the Internet.) Some observers have concerns about this trend.
Nahim Daher, an analyst at consulting firm Frost & Sullivan, says that there are privacy and security concerns associated with storing health data on the cloud. Daher notes that health care organizations don't "know where the data is sitting" and don't "have direct oversight into who is looking at it."
There are some reasons to worry less. While there were more health data breaches in 2012 than the prior year, 77% fewer patient records were affected.
Some even argue that the moving health data to the cloud actually increases protection of the data. A study by AlertLogic found that cloud service providers are less frequently attacked by hackers than organizations' internal data centers are. AlertLogic's study also found that the attacks on cloud providers typically are less sophisticated than those on enterprise data centers.
Harvard professor and co-chairman of the HHS health information technology standards committee John Halamka says that the health care industry is aware of the risks and making needed changes. According to Halamka, "It's completely headed in the right direction."
There's definitely good news for investors. Increased interoperability and movement of health data to the cloud presents some great investment opportunities. Some estimate that global health care revenue related to cloud storage and computing will nearly triple by 2017.
One stock to consider is Verizon (NYSE: VZ ) . The communications company recently launched a cloud platform for clinical providers to share data with each other. This solution addresses security, identity management, and all regulatory requirements for health data. Gartner VP and analyst Wes Rishel says that Verizon "could become a significant player" in the health information exchange market.
Qualcomm (NASDAQ: QCOM ) is another interesting play on the explosion in health data interoperability. The company's 2net Platform makes it easy for wireless devices to securely send health data to health care providers, payers, and patients. WebMD is using Qualcomm's technology to build its new Health Cloud platform due in the fall. The application will support online access of biometric data for users of mobile medical devices and their health care providers.
Athenahealth (NASDAQ: ATHN ) stands out as a leader in cloud-based electronic medical record systems for physicians. The company has seen phenomenal growth over the past few years. Its acquisition of point-of care medical application company Epocrates earlier this year opens up lots of mobile and interoperability opportunities.
While risks remain with your health data zipping to parts unknown, there's no stopping the bandwagon of increased interoperability among health care organizations. I think that security of this data will improve in spite of these risks. In the meantime, investors have opportunities to profit from this data exchange. Like Bobby McFerrin sang in the '80s, "Don't worry; be happy."
What macro trend was Warren Buffett referring to when he said "this is the tapeworm that's eating at American competitiveness"? Find out in our free report: What's Really Eating At America's Competitiveness. You'll also discover an idea to profit as companies work to eradicate this efficiency-sucking tapeworm. Just click here for free, immediate access.