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Home / Tim Worstall /A deep and complete misunderstanding of the value of NHS data

A deep and complete misunderstanding of the value of NHS data

Summary:
There is a claim that we can’t allow those naughty American tech companies access to NHS data because it’s valuable. To which the correct answer is, nonsense. Not that this stops people spouting further nonsense on the subject but there we are, that’s alarmist politics for you.The claim about the value of the data is here:Accountants Ernst & Young estimate its value at £9.6bn annually.No, not quite. The actual claim is:Data held by the NHS could be worth nearly £10bn a year through operational savings, improved patient outcomes and benefits to the wider economy, a report from Ernst & Young has concluded.It’s necessary to be a little pedantic here. That wider value to society is all very well but what matters to the value of the original resource is how much of that value can be captured.

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There is a claim that we can’t allow those naughty American tech companies access to NHS data because it’s valuable. To which the correct answer is, nonsense. Not that this stops people spouting further nonsense on the subject but there we are, that’s alarmist politics for you.

The claim about the value of the data is here:

Accountants Ernst & Young estimate its value at £9.6bn annually.

No, not quite. The actual claim is:

Data held by the NHS could be worth nearly £10bn a year through operational savings, improved patient outcomes and benefits to the wider economy, a report from Ernst & Young has concluded.

It’s necessary to be a little pedantic here. That wider value to society is all very well but what matters to the value of the original resource is how much of that value can be captured. Historic evidence suggests that in a free market and capitalist society the entrepreneur gains about 3% of that total value. Who creates the new is therefore not a major concern, it is that the new is created which concerns us.

We should also be a little more pedantic here. Data is unsorted, that’s the patient records and so on. Information is what is valuable, that’s the knowledge that we extract from the data by processing it. It is the information, the knowledge, that is valuable, not the data. It is therefore morally and logically fair enough that the people who produce the valuable thing, that information, get some to all of the value added by doing the processing.

But rather more importantly what we out here are concerned about is that we get to enjoy that value in better health care. This is simple Adam Smith again, the point is always consumption. We are even given an example of how valuable the information - note, not data - can be:

Records of 1.6 million patients were handed over to Google’s DeepMind to help create an app, Streams, intended to alert clinicians rapidly to potentially acute kidney injury. Following complaints, the ICO found that patients were not fully informed about how their data was being used, and requested that the Royal Free tighten up its own data protection procedures.

The actual finding was that the NHS dehydrates some people to the point of kidney failure, something cured by giving them a glass of water. We exaggerate but not by much. And with or without such exaggeration that’s a useful and valuable thing to know - we care not at all who provided this value to us.

So, it is the processing that creates the value, not the data. How would we want matters to proceed from there?

The current approach – of allowing free access to data, and strictly enforcing intellectual property on insights and techniques derived from it – needs to be turned on its head. Localisation of data – and therefore democratic control and data sovereignty – must always be treated as an option in trade deals, while the patenting and copyrighting of algorithms and data-derived insights (particularly when taken from public data sources) should be weakened.

That suggestion is of course entirely the wrong way around. It is the creation of the information we’re interested in, it is the processing that adds the value. Therefore we’d like a system that rewards those who create information by processing data.

Perhaps more acutely, we’d like people competent to process data into information doing that. We do rather think that Google, Amazon, and the rest know how to process data. They’re pretty good at it, they seem to have this computing thing well handled and understood. The NHS once spent £11.7 billion or so on a computing project that produced not one usable line of code. So, who do we want processing data to discover those nuggets of knowledge and information?

We’d suggest that it be those provably competent at doing so. But maybe that’s just us, it’s difficult to tell these days with some people.

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Tim Worstall
Tim Worstall is a British-born writer and Senior Fellow of the Adam Smith Institute. Worstall is a regular contributor to Forbes and the Register. He has also written for the Guardian, the New York Times, PandoDaily, the Daily Telegraph blogs, the Times, and The Wall Street Journal. In 2010 his blog was listed as one of the top 100 UK political blogs by Total Politics.

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