September 21, 1983. Doesn’t ring a bell? Maybe not, but the course of history changed on that day. It was the day that the FCC approved the first portable mobile phone, the 8000x by Motorola.

Gadget lovers were able to pick up “the brick” for a mere $4,000. Since then, thirty years of technological advances have put a smart phone in the pocket of almost everyone over the age of 12.

You can tell a similar story for computers and televisions. Better technology, lower prices.

Do we dare hope that a similar pattern will appear in the world of healthcare?

A new medical device suggests the possibility. The PillCam COLON by Given Imaging received FDA approval earlier this year. The device is a small capsule with two cameras embedded in it. Patients swallow the PillCam which transmits images of the colon to a receiver worn as a belt.

The cost of the disposable PillCam is only $500 while the typical colonoscopy runs about 4 grand. I don’t know about you, but I like the sound of a colon screening that is one eighth the cost and far more pleasant than the colonoscopy. Hooray for technology!

But don’t line up for your PillCam just yet. According to Given Imaging’s website, the PillCam isn’t for everyone.  It’s for patients who have had an “incomplete colonoscopy” for reasons other than poor prep.  

The PillCam doesn’t offer results that are quite as complete as the colonoscopy. This puts colonoscopy providers in the role of gatekeeper for the PillCam.

The problem with this reasoning is that the lack of complete results can be made up for with increased testing. According to the CDC, 20 million adults are not screened for colon cancer as recommended. My guess is a large number of those 20 million could be convinced if the PillCam were a possible first option. I suspect some turf protection may be involved in this decision.

Here’s what you need to have a colonoscopy:

  • A procedure room
  • A physician trained in colonoscopy, typically a gastroenterologist who realizes a large percentage of his or her income from the procedure
  • An anesthesiologist or anesthetist if your physician doesn’t administer sedation
  • Specialized equipment
  • Care in a recovery room until sedation is worn off.

Each item on this list generates revenue. It’s easy to see where the typical $4,000 goes. It’s also easy to see why there might be resistance to a colonoscopy replacement. Perhaps Given Imaging found a back door entrance into the market. I’m not the only one who thinks this market positioning was a smart move.

Basically, an industry that profits from the status quo isn’t as open to transformation as the consumer goods markets are.

Clay Christensen, author of The Innovator’s Dilemma, described the situation in the Harvard Business Review. “Powerful institutional forces fight simpler alternatives to expensive care because those alternatives threaten their livelihood.”  Christensen explains how the healthcare industry can manage a disruptive revolution.

The industry would be wise to take Christensen’s advice. The entrepreneurial economy is changing industries from the outside in. The barrier to entry into healthcare is lower than ever.  Technology, low startup costs, and the availability of venture capital make it so.

The Affordable Care Act provides innovation awards to fund applicants with ideas that will drive change to the healthcare system and deliver better outcomes.

Accelerator programs are popping up around the country. These startup boot camps speed the process of getting new products to market.  An increasing number are focused solely on healthcare. Rock Health, for example, is a San Francisco based digital health accelerator.  Their “companies exemplify the ongoing transformation of the healthcare system through the use of technology.”

Perhaps the healthcare world is warming up to the possibility of transformation. Rock Health is advised by Harvard Medical School, The Mayo Clinic, and Kaiser Permanente.

Or, maybe they want to make sure things don’t get too innovative.