LOOK TO THE DEVELOPING WORLD FOR MARKETS AND OPPORTUNITIES.

Lacking appropriate financial incentive, hospital IT departments and their budgets are largely focused on maintaining installed systems that tend to be associated with revenue generation (e.g., MRI machines or billing systems). In addition, hospitals have been investing enormously in the installation of electronic medical records, thanks to the up-to-$44,000 per eligible doctor incentive provided by the federal government via the HITECH Act. Such installations are significant undertakings that will consume the bandwidth of clinicians and IT departments for years to come. Health IT startups that are patient enough to weather the EMR installation marathon will then face government-subsidized EMR oligarchs that have much to lose and little to gain by allowing access to their data and interfaces.

Entrepreneurs, engineers, and forward-looking clinicians dream of tablets connected to diagnostic devices that use the cloud and advanced analytics to identify and deliver lifesaving recommendations just when and where they're needed most. Unfortunately, when they wake to their day jobs, most find themselves working on direct-to-consumer products or developing "sidecar" systems that remain an arm's length from patient care.

But there's another possibility: What if we look to developing markets for healthcare IT innovation to flourish? Many of the necessary ingredients are there. Overseas markets are so inviting, in fact, that would-be US entrepreneurs should even consider taking their game overseas, proving their health IT products in developing markets, and returning when US healthcare is finally ready for widespread health IT innovation.

Having a problem to solve is certainly a prerequisite for innovation. And there are no shortages of challenges in delivering healthcare both locally and abroad. However, as we've seen in the US, without economic incentives, the greatest solutions do little more than consume venture capital or take up shelf space in medical libraries. In contrast, the healthcare systems of many developing nations are economically incentivized to invest in improving care.

In India, for example, care is provided via a mix of public and private clinics. Care provided in private clinics is typically paid for out-of-pocket. This means private clinics must compete not only against other private clinics, but also against public clinics, where care is largely free. The public clinics also are incentivized to realize more efficient ways to provide care, since they serve as both payer and provider.

Talent: Talent is the lifeblood of technical innovation. Nations such as India, China, and the Philippines offer a deep pool of affordable technical talent that can be a boon to health IT entrepreneurs. And potential candidates may be drawn to the chance to develop software that improves the health of their fellow countrymen. 

Ready or not
If the developing world is such an attractive place to innovate, why aren't we seeing more innovation occurring in these nations? Actually, we are. And if the US isn't careful, we may find ourselves lagging behind.

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