Commercial risk will be a critical catalyst of progress – it’s complicated, but is it possible? We think so.

Blog Post

Why ending net neutrality will likely be bad news for health care

December 14, 2017

    This post was updated on Dec. 14, 2017

    On Thursday, the Federal Communications Commission (FCC) in a 3-2 vote repealed net neutrality—the rules that required internet service providers (ISPs) to treat all internet content equally, as opposed to steering it into "fast lanes" and "slow lanes" or blocking selected content outright.

    Here's what you need to know about net neutrality and how its repeal may affect health care.

    How did the net neutrality rules come about, and what's the big debate?

    In 2015, the FCC reclassified ISPs as "common carriers," similar to phone services, effectively prohibiting them from blocking or slowing down access to particular online content or services. The rules also said ISPs couldn't charge service providers or customers more to speed up access to specific content.

    Supporters of net neutrality rules have argued they ensured an open internet and lowered barriers to entry for new companies to innovate and disrupt the status quo. They noted it could be harder for a new YouTube- or Netflix-type service to compete if it has to pay a big premium to ISPs to have fast speeds to its service. In some cases, ISPs have an incentive to block or slow down internet speeds to websites and services that compete with the ISPs themselves. For instance, Netflix in 2014 accused Comcast, a fellow content provider, of deliberately slowing down speeds to its website, and several wireless carriers previously blocked access to Google Payments while promoting their own competing services.

    Opponents of net neutrality rules, including the major telecom companies, have argued that they limited choices for consumers by prohibiting ISPs from offering a wider variety of services at different price points. They've also said the rules slowed investment in broadband networks.

    What will repeal do, and what will it mean for health care?

    Under the net neutrality repeal plan enacted on Thursday, which was first unveiled on Nov. 21 by FCC Chair Ajit Pai, ISPs will now be able to increase or decrease broadband speeds for certain services and websites or block access altogether, so long as they let customers know about it.

    In theory, allowing an internet "fast lane" for certain services could improve certain internet-enabled health care services, such as telemedicine and remote monitoring. An FCC spokesperson in November told Modern Healthcare, "With Internet-enabled healthcare apps and services, paid prioritization could be the difference between life and death for patients who require very reliable and fast connectivity for health monitoring, consultation, and service delivery. Chairman Pai's proposals would unleash innovation and investment in networks, providing better connectivity for rural and underserved hospitals and reducing costs everywhere."

    However, in practice, we're skeptical that ending net neutrality will be a positive development for patients and providers, for three main reasons.

    First, ISPs may use their dominance in a region to pick winners and losers in other markets—to choose which providers of telemedicine, data centers, and cloud computing services have to pay far more for reliable connectivity and which do not. This is important, as several ISPs either operate or have existing financial relationships with vendors of these services, creating a conflict of interest. The FCC says that the Federal Trade Commission or Justice Department could still police content blocking or slowing that is anticompetitive, but how stringently they will do so is uncertain, at best.

    Second, costs could go up for providers, either directly or indirectly. ISPs could charge hospitals, or more likely their cloud-based vendors, additional fees to deliver reliable service for their mission critical applications. Application vendors will likely pass these costs on to their customers.

    Third, the increased costs and uncertainty about access to low-cost telemedicine services could have particularly negative effects for rural providers. As four researchers wrote in a June Health Affairs blog post, "For telemedicine to be scalable and positively impact cost and outcomes, there must be a predictable infrastructure connecting patients, care providers, and technology ... The undoing of [net neutrality] weakens the infrastructure of reliable low cost connectivity that telehealth systems depend upon." A related Aug. 2017 FCC proposal would redefine adequate internet access as including slower mobile data providers, as opposed to high-speed cable or fiber services, which would hinder the function of telemedicine services.

    Overall, the repeal of net neutrality creates additional uncertainty for access to the internet. ISPs might respond by increasing internet speeds and reducing costs for key internet-enabled health care services, or they may do the reverse. But from our vantage point, the repeal of net neutrality will most likely be bad news for providers and health care IT more broadly.


    Download our cheat sheets

    Get up to speed on the new and emerging technologies for today’s digital health systems.

    Download Now

    Have a Question?


    Ask our experts a question on any topic in health care by visiting our member portal, AskAdvisory.