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Emblematic of the lack of innovation is the fact that many (if not most) physicians’ offices still rely on a device that disappeared in just about every other industry two decades ago: the fax machine. “It’s been the most sophisticated piece of technology in many doctors’ offices for decades,” points out Bill Evans, CEO of the venture capital firm Rock Health. Here’s how one journalist, Sarah Kliff, writing in 2017, described the situation:

In the medical sector, the fax is as dominant as ever. It is the cockroach of American medicine: hated by doctors and medical professionals but able to survive—even thrive—in a hostile environment. By one private firm’s estimate, the fax accounts for about 75 percent of all medical communication. It frustrates doctors, nurses, researchers, and entire hospitals, but a solution is evasive.

Kliff goes on to point out that one of the reasons fax‐based communications endure in the medical field is that hospitals don’t necessarily want to share patient information with each other:

While patients might want one hospital to exchange information with another hospital, those institutions have little incentive to do so. A shared medical record, after all, makes it easier to see a different doctor. A walled garden—where records only get traded within one hospital system—can encourage patients to stick with those providers [19].

The persistence of the fax machine (and the paper that accompanies it) demonstrates how technology has often been treated as a cost of doing business and not a tool for progress (as it has been in just about every other industry). The fax machine is also an administrative headache that saps the productivity of all health care professionals who are subject to it. Today, about one‐third of physician practices insist on doing business with paper forms and fax machines. It is often used when a physician’s office fills out a claims form on paper and faxes it to the payer, who pays someone to transcribe it into their system. Then the payer identifies information that is missing in the form but is needed to process a claim. The form gets faxed back to the doctor’s office, which amends it and faxes it back. The payer then must pay someone to transcribe the information into the system.

These kinds of inefficiencies drive up the cost of transactions. There are also health consequences. The absence of shared medical records makes it nearly impossible to get a longitudinal view of a patient’s health care history. This is striking, particularly when compared with other products, such as one’s car, where a comprehensive maintenance history is often easily accessible.