Why Centralized Health Data Warehouses Are Obsolete

Centralized data warehouses create a honeypot for attackers, with breaches costing the industry ~$10B annually. They are a liability, not an asset.

• Vulnerability: A single breach exposes millions of patient records.
• Cost: Compliance and security overhead consumes >15% of IT budgets.
• Dependency: System-wide downtime halts clinical operations.

HL7 and FHIR APIs are duct tape on a broken system, creating brittle, point-to-point integrations that fail at scale.

• Friction: Data exchange between Epic, Cerner, and other EMRs remains manual and error-prone.
• Latency: Real-time patient data access is a myth, with sync delays of hours or days.
• Cost: Each new integration requires custom, expensive development.

Patients are treated as data subjects, not owners. Portability is an afterthought, locking individuals into provider networks and stifling innovation.

• Control: Patients have zero cryptographic ownership of their own genomic or health history data.
• Monetization: Data is monetized by intermediaries ($100B+ market), with no value returned to the source.
• Innovation Barrier: Researchers and AI models are starved of permissioned, composable data sets.

The architectural answer is decentralized identity (DIDs) and verifiable credentials on a permissioned ledger, akin to Baseline Protocol for enterprise but for health.

• Ownership: Patient-held keys grant cryptographic control and audit trails.
• Interoperability: Zero-knowledge proofs enable selective data sharing without exposing raw data.
• Composability: Creates a liquid market for permissioned health data, unlocking novel therapies and AI training.

Centralized data lakes are honeypots for attackers, with breaches costing the healthcare industry ~$10B annually. The monolithic architecture means a single exploit can expose millions of patient records, as seen with Change Healthcare.\n- Vulnerability: Centralized credential stores and perimeter-based security.\n- Impact: Catastrophic data loss, systemic downtime, and regulatory fines.

Proprietary APIs and data silos create ~$30B in annual administrative waste from manual reconciliation. Legacy systems like Epic and Cerner act as walled gardens, making patient data portability and cross-institutional care coordination a manual, error-prone process.\n- Friction: Custom, costly integration projects for every new partner.\n- Result: Fragmented patient journeys and delayed treatments.

Patients have no cryptographic ownership or granular control. "Consent" is a legal abstraction, not a technical guarantee. Data usage is opaque, and revocation is ineffective, undermining trust and compliance with regulations like HIPAA and GDPR.\n- Deficiency: Lack of auditable, patient-held access logs.\n- Consequence: Regulatory risk and eroded patient trust in digital health.

Centralized governance and slow vendor release cycles stifle innovation. Deploying new analytics or AI models requires navigating bureaucratic procurement and risking data exfiltration. This creates a ~18-24 month lag behind the cutting-edge research seen in open, modular ecosystems.\n- Barrier: Vendor lock-in and closed development environments.\n- Cost: Missed opportunities in personalized medicine and predictive care.

Inefficient data monetization captures value for intermediaries, not patients or providers. Data is an illiquid, locked asset. Contrast with tokenized data models in DeFi (e.g., Ocean Protocol), which create liquid markets and align incentives, unlocking billions in trapped value.\n- Inefficiency: Value extraction by data brokers and platform vendors.\n- Alternative: Patient-controlled data economies with programmable royalties.

Centralized infrastructure cannot scale to handle exponential growth in genomic, IoT, and continuous health data. Costs for storage and compute grow linearly, leading to data rationing and discarded information. Decentralized networks like Filecoin and Arweave demonstrate ~10x cost reduction at planetary scale.\n- Limit: Vertical scaling hits physical and financial constraints.\n- Future-Proofing: Requires a shift to horizontal, peer-to-peer architectures.