These $500 medical records show why Apple could upend the health data industry

• A Government Accountability Office report says many patients simply give up on getting their medical records when they hear of the cost.
• Apple may be the only company that can push the health-care industry into the future.

Michael Nagle | Bloomberg | Getty Images

Apple's potential role in delivering health records to consumers was underscored this week by a government watchdog report that showed how costly and complex it is for patients to retrieve their most sensitive data.

In a 25-page report about the "fees and challenges" that patients face in getting their medical records, the Government Accountability Office said many people simply give up on trying to collect their personal information when they hear of the cost, especially if they're very ill.

The GAO provided examples from a patient advocacy group, including two patients who were charged more than $500 for a single record request, one who was charged $148 for a "PDF version of her medical record," and two others who were "directed to pay an annual subscription fee" for access.

This is the reality of the world Apple is entering.

In January, the iPhone maker announced a new health records app and said that it is partnering with hospitals Cedars-Sinai, Johns Hopkins Medicine and Penn Medicine and electronic medical record companies including Epic Systems, Cerner and Athenahealth.

Apple is setting out to break down the walls that separate the many silos where medical data is stored and has developed a standard that's been adopted by several big companies so they can transfer records across disparate systems.

Here's what Steve Kraus, a health investor at Bessemer Venture Partners, said after Apple disclosed its initiative:

"The brilliance of Apple's approach thus far is to open up their software and services to developers to build apps for consumers, and allow the consumer to push their data to these apps," Kraus wrote in an op-ed for CNBC. "I believe the same paradigm will exist in health care, where consumers will push their personal health records to apps to open up a much more personalized and engaging product experience."

But the health-care industry is a unique beast.

Charges for records vary from state to state, and requests can come into hospitals in person, over email, by snail mail, through a fax, over the phone or via a proprietary online portal. Privacy must be ensured every step of the way. Also, medical centers are stuck on older systems, with 78 percent of physician practices in the U.S. using legacy software as of 2013, despite the fact that one-third to two-thirds of physicians surveyed are dissatisfied with the technology, according to a 2016 report in the online journal "Perspectives in Health Information Management."

The dream scenario for Apple, and potentially for iPhone users, is a digital hub similar to how iTunes centralizes your music.

The GAO report lays out some of the challenges. They include storing and sharing documents that are hundreds of pages long, scanning of paper documents with charts that are difficult to read, dealing with a mix of paper and electronic records and protecting the privacy of electronic data.

The future of health data

On its newsroom page in March, Apple published a story highlighting the need for patient control of data and the work that will be required to get there.

"People hand you all sorts of things these days," one doctor told Apple. "More data is almost never bad, but when they show up with paper, how do you summate that?" He called it "a very tedious task."

This isn't music, books or apps, but Apple may be the only company on the planet with the power to push the medical industry in a new direction.

As Jeff Williams, Apple's chief operating officer, said in an interview earlier this year, "We view the future as consumers owning their own health data."

— CNBC's Christina Farr contributed to this report