7 ms·

It's worth noting that highly regulated industries are not necessarily bad for startups to enter, exactly because they throw up particularly high barriers to la

by zmmmmm 12y ago

It's worth noting that highly regulated industries are not necessarily bad for startups to enter, exactly because they throw up particularly high barriers to large companies. Google can't enter health without accepting the full baggage that comes with that - people worried about their privacy, every random nutter looking to sue them and get a payday, FDA breathing down their neck every step of the way, etc. A small startup can be much more nimble and targeted and address a very specific niche in a clever way and be very successful.

wyager 12y ago
>It's worth noting that highly regulated industries are not necessarily bad for startups to enter, exactly because they throw up particularly high barriers to large companies. That doesn't make any sense at all. Large companies are either A) already past any barriers to entry or B) have enough money to bust through any barriers to entry. There are probably very few real world situations where being "nimble" is enough to overcome onerous regulations. The reality of the matter is that you just need a lot of money to pay lawyers.
tn13 12y ago
It sounds very contradictory. In most of the heavily regulated industries such as healthcare or insurance, one of the economic efficiencies are a better understanding of the complex law, startups can not solve this inefficiency in their favor.
- zmmmmm 12y ago
  I'm not saying you don't need to understand the regulations and law - you absolutely do. But you do have an advantage in being able to be less conservative and more innovative in how you interpret them. For examples, take Uber and AirBnb - they are both pushing the boundaries of highly regulated industries. An existing hotel chain couldn't do it because they have too much to lose, and target such broad markets. But a scrappy startup can.
  - pwnna 12y ago
    Finding loopholes?
    - famousactress 12y ago
      Maybe sometimes, but that's strong. Just avoiding groupthink or the weight of ecosystem apathy that tends to grow out these depressing verticals that hire incestuously from other shops that have been building shitty products really slowly for years. I don't mean to downplay the ridiculous bureaucratic and regulatory crap, but I don't think it's fair to lay the blame at it's feet either. Honestly, health is just a Ripe For Disruptions™ as any startup-interesting vertical. Takes more stomach and open-mindedness than anything. It's a bummer. Page/Google are being limp and lazy on this. With opportunities as broad as they have they can afford to Do Hard Things, where Hard is something a little bit out of their wheelhouse. That's okay I guess, but it's a big shame cause health IT could really use some shops with lots of leverage and actual engineering talent to help move the needle when it comes to the constantly backward standards. [FWIW - I'm a decade and a half long healthcare startup hacker]
  - laurenstill 12y ago
    I'd argue they are at disadvantage. Small startups can't eat the cost of spending 2 years developing for a particular standard just to have it changed on the due date.
    - famousactress 12y ago
      That's a fair argument but in practice isn't true. The pace at the larger health IT shops is FUCKING GLACIAL. I've been through getting an EMR through two meaningful use stages in a fifth the time combined than a typical larger shop might've gotten one done, with a tenth the manpower. In verticals like this don't dismiss the advantage of being lean, nimble, and wholly stocked with incredible and enthusiastic people.
  - famousactress 12y ago
    This. This. This. I wish more people saw healthcare this way, and I guess now I'll probably use Uber and AirBnb as an analogy to help them to. THIS is the way to think about health, and how to treat it's risks and limitations.
- mherdeg 12y ago
  Well-loved YCombinator startup Stripe spent a bunch of its early time wrangling with the complexity of the payments industry precisely so that their customers wouldn't have to.
- jeffbr13 12y ago
  Legal frameworks are definitely tractable, and investing the time to navigate them more effectively can give you the same sort of competitive advantage as mastering a technology. Same principle, different domain.
crazy1van 12y ago
Often times the regulations were designed in cooperation with existing businesses in the industry precisely to keep more competition out.
laurenstill 12y ago
Most people don't worry about their data privacy, or else they wouldn't be on FB, take those buzzfeed quizzes, etc. The P in HIPAA stands for Portability. At it's heart, the act was supposed to guarantee patients have access to their health information, not bring health data liquidity to it's knees. This is Jonathan Bush, of Athena, testifying (read: ranting) a couple weeks ago about regulations and innovation in healthcare. The big take away is that healthcare specifically sets these rules with incredibly high barriers of entry, and then at the last minute does a complete 180. We've seen it every step of the way with the EHR incentive program, CEHRT, ICD-10, payment reimbursement, etc. https://www.youtube.com/watch?v=CekfvGDiab8 https://www.youtube.com/watch?v=CekfvGDiab8
- tallanvor 12y ago
  How many people do you see posting all of their conditions and the medications they're taking on Facebook? I can't think of any friend who is THAT open. Also, whether or not people care about their privacy doesn't mean it shouldn't be protected. Not just for themselves, but for their family as well. --Let's say I don't allow my medical information to be used, by my brother does. If he has a genetic disease and a potential employer finds out about it, they might decide not to hire me because there's a chance I may have it as well, which could cause problems if it ended up needing treatment. Laws that prevent discrimination are all well and good, but the problem can be proving the reason they decided not to hire you.
  - laurenstill 12y ago
    Never said privacy shouldn't be protected, only that it's not exactly valued by BOTH sides of the equation (and of course, YMMV). Up until recently (Omnibus rule), HIPAA had little practical power in that department from both an audit perspective and a fine/mediation perspective. The largest fine levied? It was for inadequate patient access to their own health information, not a security breach. And even with the new rule, there are currently no regulations surrounding de-identified PHI being used for marketing purposes, research, or sold for whatever other purposes. So now you have data wharehousers like IMS spinning up software dev depts with the specific goal of harvesting patient data. As far as identity vs membership vs attribute disclosure, I linked to a good study below. I find it interesting that there are more comments in the average HN healthcare-related thread than on any of the recent NPRM. Hell, there are more comments here than people who actually showed up for FDASIA. I support regulation in a lot of cases, and feel that that FDA took a reasonable approach to the recent mobile medical device guidelines. What I, and pretty much everyone else (other than the AMA) rails against is the indiscriminate flip flopping of what regulations, standards, etc will be required, and on what time horizon.
deleted 12y ago
[deleted]
Multics 12y ago
Not bad for startups? So the merit of this is based on the value to startups, not society? Another way to interpret what you said is: Google and other large companies can't apply large quantities of resources to health.
- netcan 12y ago
  What is this? This is a forum for/about startups. He made a statement relevant to startups. What exactly are you mad at?
  - Multics 12y ago
    What is this? Or, what is 'this'? The answer being. 1) Quite an abstract question 2) A pronoun It's relevant. It's the conclusion that's concerning! Again. 'Another way to interpret what you said is: Google and other large companies can't apply large quantities of resources to health.'
    - netcan 12y ago
      - deleted - I apologize about this thread.
      - Multics 12y ago
        > Maybe: 'One way of misrepresenting what you said..' Then. > Allow me to put words in your mouth... I don't want you people talking about other ideas related to this article. Consistency? > I (Multics) would like to talk about how regulating industries like medicine prevents Google and others from investing in them and potentially benefiting society. I think you understand my position. Except, what I said was framed in the context of the parent comment. And it was an assertion, not a request.
      - Multics 12y ago
        Why delete a comment I mostly quoted? Seems like an attempt at gamesmanship. Well, c'est la vie!
dan_bk 12y ago
This may very well be the usual "we currently have no plans to enter the market of...", stated a few months or a year before some product/service is launched, in precisely that market.
chasb 12y ago
This is a great point. Competitive advantages come from many places. Working in 1) an unsexy area, 2) a complex area, or 3) a regulated area can all be great advantages if you can manage it.

by zmmmmm 12y ago

wyager 12y ago

>It's worth noting that highly regulated industries are not necessarily bad for startups to enter, exactly because they throw up particularly high barriers to large companies. That doesn't make any sense at all. Large companies are either A) already past any barriers to entry or B) have enough money to bust through any barriers to entry. There are probably very few real world situations where being "nimble" is enough to overcome onerous regulations. The reality of the matter is that you just need a lot of money to pay lawyers.

tn13 12y ago

It sounds very contradictory. In most of the heavily regulated industries such as healthcare or insurance, one of the economic efficiencies are a better understanding of the complex law, startups can not solve this inefficiency in their favor.

zmmmmm 12y ago
I'm not saying you don't need to understand the regulations and law - you absolutely do. But you do have an advantage in being able to be less conservative and more innovative in how you interpret them. For examples, take Uber and AirBnb - they are both pushing the boundaries of highly regulated industries. An existing hotel chain couldn't do it because they have too much to lose, and target such broad markets. But a scrappy startup can.
- pwnna 12y ago
  Finding loopholes?
  - famousactress 12y ago
    Maybe sometimes, but that's strong. Just avoiding groupthink or the weight of ecosystem apathy that tends to grow out these depressing verticals that hire incestuously from other shops that have been building shitty products really slowly for years. I don't mean to downplay the ridiculous bureaucratic and regulatory crap, but I don't think it's fair to lay the blame at it's feet either. Honestly, health is just a Ripe For Disruptions™ as any startup-interesting vertical. Takes more stomach and open-mindedness than anything. It's a bummer. Page/Google are being limp and lazy on this. With opportunities as broad as they have they can afford to Do Hard Things, where Hard is something a little bit out of their wheelhouse. That's okay I guess, but it's a big shame cause health IT could really use some shops with lots of leverage and actual engineering talent to help move the needle when it comes to the constantly backward standards. [FWIW - I'm a decade and a half long healthcare startup hacker]
- laurenstill 12y ago
  I'd argue they are at disadvantage. Small startups can't eat the cost of spending 2 years developing for a particular standard just to have it changed on the due date.
  - famousactress 12y ago
    That's a fair argument but in practice isn't true. The pace at the larger health IT shops is FUCKING GLACIAL. I've been through getting an EMR through two meaningful use stages in a fifth the time combined than a typical larger shop might've gotten one done, with a tenth the manpower. In verticals like this don't dismiss the advantage of being lean, nimble, and wholly stocked with incredible and enthusiastic people.
- famousactress 12y ago
  This. This. This. I wish more people saw healthcare this way, and I guess now I'll probably use Uber and AirBnb as an analogy to help them to. THIS is the way to think about health, and how to treat it's risks and limitations.
mherdeg 12y ago
Well-loved YCombinator startup Stripe spent a bunch of its early time wrangling with the complexity of the payments industry precisely so that their customers wouldn't have to.
jeffbr13 12y ago
Legal frameworks are definitely tractable, and investing the time to navigate them more effectively can give you the same sort of competitive advantage as mastering a technology. Same principle, different domain.

crazy1van 12y ago

Often times the regulations were designed in cooperation with existing businesses in the industry precisely to keep more competition out.

laurenstill 12y ago

Most people don't worry about their data privacy, or else they wouldn't be on FB, take those buzzfeed quizzes, etc. The P in HIPAA stands for Portability. At it's heart, the act was supposed to guarantee patients have access to their health information, not bring health data liquidity to it's knees. This is Jonathan Bush, of Athena, testifying (read: ranting) a couple weeks ago about regulations and innovation in healthcare. The big take away is that healthcare specifically sets these rules with incredibly high barriers of entry, and then at the last minute does a complete 180. We've seen it every step of the way with the EHR incentive program, CEHRT, ICD-10, payment reimbursement, etc. https://www.youtube.com/watch?v=CekfvGDiab8 https://www.youtube.com/watch?v=CekfvGDiab8

tallanvor 12y ago
How many people do you see posting all of their conditions and the medications they're taking on Facebook? I can't think of any friend who is THAT open. Also, whether or not people care about their privacy doesn't mean it shouldn't be protected. Not just for themselves, but for their family as well. --Let's say I don't allow my medical information to be used, by my brother does. If he has a genetic disease and a potential employer finds out about it, they might decide not to hire me because there's a chance I may have it as well, which could cause problems if it ended up needing treatment. Laws that prevent discrimination are all well and good, but the problem can be proving the reason they decided not to hire you.
- laurenstill 12y ago
  Never said privacy shouldn't be protected, only that it's not exactly valued by BOTH sides of the equation (and of course, YMMV). Up until recently (Omnibus rule), HIPAA had little practical power in that department from both an audit perspective and a fine/mediation perspective. The largest fine levied? It was for inadequate patient access to their own health information, not a security breach. And even with the new rule, there are currently no regulations surrounding de-identified PHI being used for marketing purposes, research, or sold for whatever other purposes. So now you have data wharehousers like IMS spinning up software dev depts with the specific goal of harvesting patient data. As far as identity vs membership vs attribute disclosure, I linked to a good study below. I find it interesting that there are more comments in the average HN healthcare-related thread than on any of the recent NPRM. Hell, there are more comments here than people who actually showed up for FDASIA. I support regulation in a lot of cases, and feel that that FDA took a reasonable approach to the recent mobile medical device guidelines. What I, and pretty much everyone else (other than the AMA) rails against is the indiscriminate flip flopping of what regulations, standards, etc will be required, and on what time horizon.

deleted 12y ago

[deleted]

Multics 12y ago

Not bad for startups? So the merit of this is based on the value to startups, not society? Another way to interpret what you said is: Google and other large companies can't apply large quantities of resources to health.

netcan 12y ago
What is this? This is a forum for/about startups. He made a statement relevant to startups. What exactly are you mad at?
- Multics 12y ago
  What is this? Or, what is 'this'? The answer being. 1) Quite an abstract question 2) A pronoun It's relevant. It's the conclusion that's concerning! Again. 'Another way to interpret what you said is: Google and other large companies can't apply large quantities of resources to health.'
  - netcan 12y ago
    - deleted - I apologize about this thread.
    - Multics 12y ago
      > Maybe: 'One way of misrepresenting what you said..' Then. > Allow me to put words in your mouth... I don't want you people talking about other ideas related to this article. Consistency? > I (Multics) would like to talk about how regulating industries like medicine prevents Google and others from investing in them and potentially benefiting society. I think you understand my position. Except, what I said was framed in the context of the parent comment. And it was an assertion, not a request.
    - Multics 12y ago
      Why delete a comment I mostly quoted? Seems like an attempt at gamesmanship. Well, c'est la vie!

dan_bk 12y ago

This may very well be the usual "we currently have no plans to enter the market of...", stated a few months or a year before some product/service is launched, in precisely that market.

chasb 12y ago

This is a great point. Competitive advantages come from many places. Working in 1) an unsexy area, 2) a complex area, or 3) a regulated area can all be great advantages if you can manage it.