2. 2
RHIO vs HIE
A RHIO is an organization whose chief objective is to bring community leaders together from disparate stake
holding interests around a vision of health data interoperability. By arguing that systemic improvements result
from fully mobilized patient data, they initiate a process of trust building, whereby stakeholders are brought
into convergence. As momentum gathers, conversations yield to negotiations, and stakeholding leaders lay the
groundwork for governance, mission statements, business plans, choices of functionalities, privacy and security
policies, management teams, financial commitments, and covenants. The result of these hard-won efforts is a
RHIO, usually a non-profit organization composed of influential stakeholders bound by covenants and vision.
As opposed to economic or technical functions, its chief utility is political, and as such, is the indispensable
catalytic agent of change without which the economic and technical functions of exchange will not come to
pass.
By contrast, Health Information Exchange represents the human capital side of the equation. HIE is what
emerges from the presence of RHIO activities, e.g., social capital giving birth to human capital. Human
capital is the specialized knowledge and skill sets that make exchange possible. It ranges from executive team
business acumen to technology platforms. All RHIOs at this point are not only acting as catalytic agents of
social capital, but also as incubators for whole new sets of skills and technology applications that constitute the
means of exchange, from data hubs to edge system connectors. This is the aspect of exchange that is so
disruptive — people working within the exchange must acquire novel skills to successfully leverage the new
potential. Management must develop creative services and revenue models to support them, along with
inventive applications of traditional finance and accounting disciplines. Technical staffs have to master vendor
products. They must, in turn, be able to support and teach edge system users how to deploy the new
functionalities. End users, such as physician offices, need to alter workflows to leverage enhanced information
flows.
4. 4
HIE Stakeholders
LABORATORIES
HEALTHCARE HOSPITALS
PAYORS
HIE DIAGNOSTIC
IMAGING
AMBULATORY
EHRs
WEB PORTALS
MEDICATION
INTERMEDIARIES PUBLIC HEALTH
OTHER PHRs
AGENCIES
/HEALTH BANKS
5. 5
eHealth Initiative (EHI)
Report Key HIE Survey Findings:
The value of HIE is not clearly understood by the majority of respondents: 54.9% disagree
or strongly disagree with the statement that the value of HIE is clearly understood.
The majority of respondents believe outreach to consumers about the value of EHRs and
HIE is not effective: 66.6% disagree or strongly disagree with the statement that current outreach to
consumers about the value of EHRs and HIE is effective.
There has been an increases in functionality amongst health information exchange initiatives with
respect to the meaningful use rules:
The top 3 functionalities being provided by the initiatives:
Connectivity to EHRs (67)
Results Delivery (50) The top 3 services offered by the state designated
Health Summaries for continuity of care (49) entities:
Electronic prescribing and refill requests (4)
The top 5 types of data exchanged by the initiatives: Prescription fill status and/or medication fill
history (3)
Laboratory Results (68)
Electronic eligibility and claims transactions (3)
Medication Data (63)
Outpatient laboratory results (62)
Allergy Info (61)
ED episodes/discharge summaries (58)
Source: 199 of 234 participated in survey/ 48 of 56 SDE’s participated
6. 6
Revenue Sources for Operational HIEs
Ongoing Revenue Sources for Operational HIEs
Hospitals 27%
Physician Practices 20%
Payors - Private 15%
Labs / Ref Labs 12%
Federal Gov’t Grants & Contracts 7%
State Gov’t Grants 7%
Payors – Medicaid / Medicare 6%
Public Health 6%
Hospitals
Physician Practices
Payers - Private
Labs / Ref Labs
Federal Gov’t Grants & Contracts
State Gov’t Grants
Payers – Medicaid / Medicare
Public Health
7. 7
Funding Sources
Top 3 Funding Sources for Operational HIEs
Subscription Fees or Membership Dues to Data Users / Providers - 65%
Transaction Fees Charged to Data Users / Providers – 20%
One-time financial contribution to HIE (Donation) – 12%
18 break-
even
initiatives
Subscription / Membership
One-Time Donation
Transaction Fees
Advertising or Marketing
Public Health Utility
8. 8
eHealth Initiative (EHI)
Dependency on Federal Funding (All Initiatives)
Dependent on Gov’t Funding –35%
Independent Funding – 61%
Not Sure – 7% Not Sure
4%
Dependent
35%
Independent
61%
9. 9
eHealth Initiative (EHI)
Sources of Startup
Hospitals
State Gov’t
Federal Gov’t Grants
Payors / Private
Physician Practices
Medicaid / Philanthropic Sources
Medicare Public
5% Health Payors – Medicaid / Medicare
Philanthropic 3%
Sources Public Health
8%
Medical Hospitals
21%
Medical Societies
Societies
4%
Physician
Practices
11% State
Gov’t
19%
Payors /
Private
12% Federal
Gov’t Grants
17%
10. 10
eHealth Initiative (EHI)
Sustainable Model Revenue Sources
– Stakeholders paying dues/fees
Hospitals
Health Plans
Community Clinics
Independent Labs
Primary Care Physicians
Mental Health
Long-Term Care
Ambulatory Surgery
Specialty
Centers
Physicians
Ambulatory Surgery Centers
8% Hospitals
8% 19% Specialty Physicians
Long-Term Care
9% Health Plans
14%
Mental Health
10%
Community Clinics
Primary Care 12%
Physicians
10% Independent Labs
10%
11. 11
eHealth Initiative (EHI)
Sustainable Initiative Top
Services
Connectivity to EHR
Alerts to Providers
Referrals & Consultations
Results (Lab / Dx Study Results)
Health Summaries - CCR
Clinical Documentation
Alerts to Providers Connectivity to EHR eRX
D/D D/A 14%
19% Alerts to Providers Drug – Drug &
Alerts to Providers Drug – Allergies
eRX 11%
10%
Clinical Referrals
Documentation 12%
11%
Health Results (Lab / Dx
Summaries - CCR Study Results)
11% 12%
12. 12
TOP HIE Initiative Challenges
1. Sustainability model (over 60%)
2. Addressing Government Policy &
Mandates (over 60%)
3. Defining the value of the HIE (over 50%)
4. HIPAA –
Privacy, Consent, Confidentiality, Securi
ty & Breach policies (over 50%)
5. Technical infrastructure;
Architecture, Applications &
Connectivity
6. Governance Issues
7.Legal Issues
8.Cross Referencing Patients
9.Engaging Health Plans (coverage area)
10.Engaging Practicing Clinicians (coverage
area)
11.Systems Integration
12.Engaging Laboratories (coverage area)
13. 13
Excerpts from - The State of Health Information Exchange in
2010: Connecting the Nation to Achieve Meaningful Use
HIE FACTS
• 2010 = 234 HIE initiatives
• Less than 10% of Hospitals are currently linked to a HIE
• There are 73 operational initiatives in 2010 up from 57 in 2009
• Sustainable #’s 107initiatives are operational, not on federal funding, up from funding & have broken even
18
initiatives are not dependent
dependent on ―any‖ federal
71 in 2009
through operational revenue
• 44 of the 73 operational initiatives have no financial
relationship with the entities involved in the initiative
―coopetition‖
• Proven ROI Points: Reduced staff time spent on clerical administration and
filing (33 sites) - Reduced staff time spent on handling lab and radiology results (30
sites) - Decreased dollars spent on redundant tests (28 sites)
14. 14
Excerpts from - The State of Health Information Exchange in
2010: Connecting the Nation to Achieve Meaningful Use
HIE FACTS
• 131 of 199 HIE respondents cited addressing government policy
mandates as a major challenge
NO Fed. Policy
Issues
33%
Fed. Policy
Issues
67%
15. 15
Excerpts from - The State of Health Information Exchange in
2010: Connecting the Nation to Achieve Meaningful Use
FACTS
States and State Designated Entities Patient engagement has increased
(SDE) have varying perspectives of dramatically. More organizations
their purpose. are providing services to patients
40 entities see their role as planning for and providing access to patient
health information exchange data through a HIE.
8 entities see their role as building or 44 initiatives allow patients to view
maintaining a technical infrastructure their data, up from 3 in 2009
22 entities see their role as supporting a 31 initiatives allow patients to
technical infrastructure contribute information on their
2 entities are not directly involved in health status, up from 7 in 2009
building an infrastructure, but in
coordinating or creating policy
16. 16
Excerpts from - The State of Health Information Exchange in
2010: Connecting the Nation to Achieve Meaningful Use
FACTS (HIE MU)
There have been increases in functionality amongst HIE initiatives with
respect to the meaningful use rules.
o The top 3 functionalities being provided by the initiatives:
Connectivity to electronic health records (67)
Results Delivery (50)
Health Summaries for continuity of care (49)
o The top 5 types of data exchanged by the initiatives: It is NOT currently a
Laboratory Results (68) MU requirement to
Medication Data (63) connect to a HIE
Outpatient laboratory results (62)
Allergy Info (61)
Emergency Department episodes/discharge summaries (58)
o The top 3 services offered by the state designated entities:
Electronic prescribing and refill requests (4)
Prescription fill status and/or medication fill history (3)
Electronic eligibility and claims transactions (3)
17. 17
Excerpts from - The State of Health Information Exchange in
2010: Connecting the Nation to Achieve Meaningful Use
FACTS (HIE MU)
HIE HIPAA Consent Approaches: Allow
patients to control the level of access to their
PHI.
61 initiatives have global opt-in/out policies
36 initiatives have organizational opt-in/out
policies
34 initiatives have provider opt-in/out policies
14 initiatives have emergency care opt-in/out
policies
13 initiatives have individual data element opt-
in/out policies
The goal of the meaningful use rule is to improve the quality and efficiency of patient care by providing incentives
to eligible providers and hospitals to utilize certified EHR technology for the electronic exchange of health
information and the reporting of clinical quality measures. HIE initiatives can provide the technology
and support providers and hospitals who want to qualify for meaningful use incentive payments.
18. 18
Excerpts from - The State of Health Information Exchange in
2010: Connecting the Nation to Achieve Meaningful Use
FACTS Protecting Pt Privacy
What types of policies do initiatives use to protect
patient privacy?
At a minimum, all initiatives are required to abide by HIPAA standards, but most
organizations have policies that go beyond HIPAA. Only 36 respondents, 13 of which
are state designated entities, said they have no policies in place or in development
beyond HIPAA. There has been a significant increase from 2009 in privacy policies that
address sharing aggregated data with third parties. Of those that have policies in place
to protect patient privacy beyond HIPAA, the most common include:
Patient consent required to share clinical data deemed to be sensitive (e.g., mental
health, STD, AIDS) with another provider for treatment purposes (62)
Patient consent required to share clinical information with another provider for treatment
purposes (opt-in) (61)
Patient consent required to share clinical information for healthcare operations purposes (31)
Patient consent required to share aggregated or de-identified information for purposes other
than treatment, payment, or healthcare operations (31)
More stringent restrictions are in place for use and disclosure for research (31)
Patient consent required to share information for payment purposes (30)
19. 19
Excerpts from - The State of Health Information Exchange in
2010: Connecting the Nation to Achieve Meaningful Use
FACTS
Health information
exchanges span all 50
states, the District of
Columbia, and the U.S.
territories of the Virgin
Islands, Puerto
Rico, American Samoa, and
the Northern Mariana
Islands, and the island of
Guam. Florida (22), New
York (20), California
(15), North Carolina
(13), Washington
(11), Michigan (10), and
Virginia (10) have the
highest concentration of
initiatives.
20. 20
Excerpts from - The State of Health Information Exchange in
2010: Connecting the Nation to Achieve Meaningful Use
FACTS
Operational HIE Initiatives in 2010 = 73
21. 21
Excerpts from - The State of Health Information Exchange in
2010: Connecting the Nation to Achieve Meaningful Use
FACTS
Stage 1 Recognition of the need for
health information
exchange among multiple stakeholders in your
state, region or community. (Public Numbers of HIEs & SDEs & their respective stages…
declaration by a coalition or political leader)
Stage 2 Getting organized; defining
shared vision,
goals, and objectives; identifying funding
sources, setting up legal and governance
structures. (Multiple, inclusive meetings to
address needs and frameworks)
Stage 3 Transferring vision, goals and
objectives to
tactics and business plan; defining your needs
and requirements; securing funding. (Funded
organizational efforts under sponsorship)
Stage 4 Well under way with
implementation –technical,
financial and legal. (Pilot project or
implementation with multiyear budget
identified and tagged for a specific need)
Stage 5 Fully operational health
information
organization; transmitting data that is being
used by healthcare stakeholders.
Stage 6 Fully operational health
information
organization; transmitting data that is being
used by healthcare stakeholders and have a
sustainable business model.
Stage 7 Demonstration of expansion of
organization to
encompass a broader coalition of stakeholders
than present in the initial operational model.
22. 22
Excerpts from - The State of Health Information Exchange in
2010: Connecting the Nation to Achieve Meaningful Use
FACTS
Physician Involvement: Seventy-five HIE initiatives said that physician
engagement in the exchange is difficult, while 75 also said engagement was not
difficult. Physician engagement is incredibly important to the success of health
information exchange, which makes this an important finding. Respondents
cited the following as the main reasons why
physician engagement is difficult:
Lack of understanding of benefits (64)
Concern regarding implementation (34)
Physicians have limited access to
broadband (27)
Costs too much to participate (26)
Takes too much time to look up (24)
23. 23
Excerpts from - The State of Health Information Exchange in
2010: Connecting the Nation to Achieve Meaningful Use
FACTS
Patient Engagement via HIE: Operational initiatives are offering more
services to patients than last year. In 2009, only 3 operational initiatives
allowed patients to view their health data; now 44 initiatives report that
patients can review their health data. The number of initiatives that allow
patients to add information on their health status is up from 7 to 31. Thirty-
three initiatives now provide electronic communication between patients and
care providers, and 30 initiatives provide patients with access to education
information on health and Healthcare. While many initiatives are still not
providing services to patients, there has been a marked improvement in patient
services over the last year. Thirteen operational initiatives currently allow
patients to view and receive data. Eight initiatives allow patients to provide
data, and 25 allow them to be involved in governance.
24. 24
Excerpts from - The State of Health Information Exchange in
2010: Connecting the Nation to Achieve Meaningful Use
FACTS
Many exchanges strive to demonstrate that HIE can reduce costs for
physicians, hospitals, payers and patients. Forty-six of the operational
initiatives have
quantified financial savings through surveys, electronic medical records, and
other clinical IT systems. Operational initiatives are helping their customers
realize financial savings through the following:
Reduced staff time spent on clerical administration and filing (33)
Reduced staff time spent on handling lab and radiology results (30)
Decreased dollars spent on redundant tests (e.g., laboratory tests, radiology
results) (28)
Reduced medication errors (16)
Decreased cost of care for chronic care patients (16)
Reduced staff time spent on handling prescriptions (15)
25. 25
Meaningful Use & the Value of HIE
Stage 1 Meaningful Use Core Items
Connectivity to EHR (67 sites)
Health Summaries (CCR) (49 sites)
eRx (37 sites)
Alerts Drug to Drug (35 sites)
Alerts Drug to Allergy (31 sites)
Clinical Decision Support (26 sites)
27. 27
Background: Funding Data
Date
Organization Stage Geographical Area Total Funds to Date Primary Source of Revenue
Founded
Greater Rochester RHIO 5 Rochester, NY 2005 $20,700,000 Government grants
Bronx RHIO 5 Bronx, NY 2007 $13,100,000 Government grants
MidSouth eHealth Alliance 5 Memphis, TN 2005 $12,500,000 Government grants
Big Bend RHIO 6 Tallahassee Region, FL 2005 $10,400,000 Government grants
NYCLIX 5 New York, NY 2006 $8,300,000 Federal + community org grants
DC RHIO 5 DC 2006 $6,000,000 State grants
Hospitals, Foundations, Health
CalRHIO (now HIE) 4 CA 2004 $4,610,000
Plans
VT ITL 6 VT 2005 $4,200,000 State grants
Brooklyn RHIO 5 Brooklyn, NY 2007 $4,000,000 Government grants
Keystone HIE 5 Central and Northeastern PA 2005 $3,500,000 Government + private org grants
United Health Services 4 Johnson City, NY 2005 $3,500,000 Government grants
Secure Med. Rec. Transfer
7 Oklahoma 2005 $3,400,000 Sponsor grants
Network
Lakelands Rural Health
4 Lakelands, SC 2005 $1,800,000 Government grants
Network
SAFEHealth 5 Massachusetts 2005 $1,500,000 Federal grants
Capital Area RHIO 4 Mid-Michigan 2009 $1,400,000 Government grants
CareSpark 5 Appalachia (TN & VA) 2005 $600,000 Government + sponsor grants
Tampa Bay RHIO 4 Tampa Bay, FL 2005 $500,000 Government grants
28. 28
# of HIEs & their Stage of
Development according to eHI
57 HIEs were deemed
as Operational in
2009 Stages 5-7
29. 29
Stages of HIE
Development
Stage Characteristics of HIE
Stage 1 Recognition of the need for health information exchange among multiple
stakeholders in your state, region or community. (Public declaration by a coalition or
political leader)
Stage 2 Getting organized; defining shared vision, goals, and objectives; identifying funding
sources, setting up legal and governance structures. (Multiple, inclusive meetings to
address needs and frameworks)
Stage 3 Transferring vision, goals and objectives to tactics and business plan; defining your
needs and requirements; securing funding. (Funded organizational efforts under
sponsorship)
Stage 4 Well under way with implementation –technical, financial and legal. (Pilot project or
implementation with multiyear budget identified and tagged for a specific need)
Stage 5 Fully operational health information organization; transmitting data that is being
Operational
used by healthcare stakeholders.
Stage 6 Fully operational health information organization; transmitting data that is being
HIE
used by healthcare stakeholders and have a sustainable business model.
Stage 7 Demonstration of expansion of organization to encompass a broader coalition of
stakeholders than present in the initial operational model.
30. 30
HIE Stages of Maturity (Technology)
Level Defining Characteristics
Non-electronic data—no use of IT to share information (examples: mail,
1 telephone).
Machine transportable data—transmission of non-standardized information via
basic IT; information within the document cannot be electronically manipulated
2 (examples: fax or PC-based exchange of scanned documents, pictures, or PDF
files).
Machine-organiz’able data—transmission of structured messages containing non-
standardized data; requires interfaces that can translate incoming data from the
sending organization’s vocabulary to the receiving organization’s vocabulary;
3 usually results in imperfect translations because of vocabularies’ incompatible
levels of detail (examples: e-mail of free text, or PC-based exchange of files in
incompatible/proprietary file formats, HL-7 messages).
Machine-interpretable data—transmission of structured messages containing
standardized and coded data; idealized state in which all systems exchange
4 information using the same formats and vocabularies (examples: automated
exchange of coded results from an external lab into a provider’s EMR, automated
exchange of a patient’s ―problem list‖).
31. 31
Economic sustainability is the state of the RHIO / HIE can be maintained at a
satisfactory financial and operational level indefinitely.
Annual revenues exceed annual expenses and your RHIO has a sufficient return to fund
its ongoing capital and operating costs including funded depreciation.
In addition, you have developed a business model where you can fund your expansion
requirements in accordance with your strategic plan.
32. 32
Steps to Independence
Considered several alternative methods / approaches
for funding your RHIO / HIE.
Investigate various revenue models and consider
various options.
Examine several methods of raising your required
investment capital.
Develop a financial plan for obtaining the required
funds to support your ongoing operations.
Price out your technical infrastructure and understand
your organizations staffing requirements.
Convert all of this information into long-term economic
sustainability model.
33. 33
Models Simplified
• Model 1 – Government-Led Electronic HIE: Direct
Government Provision of the Electronic HIE
Infrastructure and Oversight of its Use.
• Model 2 – Electronic HIE Public Utility with Strong
Government Oversight: Public Sector Serves an
Oversight Role and Regulates Private-Sector Provision of
Electronic HIE.
• Model 3 – Private-Sector-Led Electronic HIE with
Government Collaboration: Government
Collaborates and Advises as a Stakeholder in the Private-
Sector Provision of Electronic HIE.
Most # of Sustained
Entities Model 3
34. 34
HIE Franchising
• Successful pioneer HIEs may sell their experience, expertise and
technology to other emerging RHIOs who wish to take advantage of
an established model. The trade-off is between, on the one hand,
costs, ease of implementation, speed of scaling up, and risk sharing,
and on the other hand, reduced financial upside, strategic freedom,
and brand control.
• While franchising may take several forms in mature industries,
Business Format Franchising is the most commonly known form and
provides the franchisee with a complete business plan for all aspects
of operating a business within that system. HIEs may be attracted to
the franchise model on the basis of proven, verifiable success, faster
time to market, training and know-how, established name, patents,
trademarks, copyrights, lower capital requirement and financing
conditions, scale through association with existing data and net
35. 35
Eligible Stage 1 Criteria for Meaningful Use
Providers Communicate with Public Health
1) Immunizations 1) Immunizations
2) Syndromic Surveillance 2) Syndromic Surveillance
3) Reportable Disease
RHIO / HIE
Public Health
Improve Population Health
Prevention Communicable Disease
Children & Adolescents Case Investigation
Adults & Seniors Mitigation
Syndromic Surveillance / Early Warning Outcomes
Outbreaks Monitoring & Evaluation
Disease – natural, emerging, terrorism Comparative Effectiveness
Food borne Chronic Disease Management (CDM)
Bio-surveillance
36. 36
Reasons Early RHIOs Failed
• Lack of buy in due to competing/conflicting
organizational interests
• Perceived lack of control and trust in the
network organizational processes
• Lack of clear rules for ownership of data
• Lack of financial sustainability
• Technological difficulties
37. 37
Sustainable HIE
• Sustainable HIE reflects a situation where: the costs and
benefits of HIE are constructed so that ongoing HIE operations
will be funded based on the value generated from HIE (e.g.
transaction fees, subscriptions, 3rd party reimbursements)
instead of other sources external to direct value chain (e.g.
government grants and subsidies)
• Challenges:
▫ Misalignment of benefits and incentives
▫ Broad stakeholder support, competing interests It is possible for any healthcare
provider, Healthcare consumer or payer to
▫ Privacy concerns, technical challenges, EHR adoption electronically share individually identifiable
▫ Quantifying benefits information to support efficiency and quality
of care in a standards-based format using
non-proprietary mechanisms and in a
manner compliant with all state and federal
security and privacy laws, regulations, and
policies*
*Source: NORC, 2009
38. 38
Value Creation &
Sustainability
The key to RHIO sustainability is to identify sources of value for each
stakeholder group, create services to deliver the value, and monetize that
value strategically
• Necessary conditions • Factors influencing sustainability
▫ EMR adoption ▫ Ability to quantify value
▫ Data availability
▫ Support of key
▫ Presence of competition (other HIEs)
stakeholders ▫ Scalable business model leveraging ASP or pay per use
▫ Governance structure model of paying for services provided by vendors
▫ Adequate seed funding ▫ Avoiding fixed costs such as IT employees or investments
in IT infrastructure without firm commitments from
▫ Viable business model customers about usage, pricing and revenues
▫ Leverage cost by connecting to physician EMR
▫ Develop clinical drug trials and protocols directly with
Pharma
▫ Develop quality and transparency pilots
▫ Develop pay-for-performance initiatives with payers
▫ Develop direct payer-coordinated claims processing
efficiency pilot
39. 39
Returns Reported by HIE’s
• HIE cost savings were reported by 40 operational initiatives in a range of
ways:
▫ Decreased staff time spent on handling lab and radiology results (26 operational
initiatives).
▫ Reduced staff time spent on clerical administration and filing (24).
▫ Decreased dollars spent on redundant tests (17).
▫ Decreased cost of care for chronic care patients (11).
▫ Reduced medication errors (10).
• Operational initiatives report the following impacts for practices that
utilize the exchange:
▫ Improved access to test results and resultant efficiencies on practice (28
operational initiatives).
▫ Improved quality of practice life (i.e., less hassles looking for information, getting
home sooner at the end of the day, etc) (24).
▫ Reduced staff time spent on handling lab and radiology results (23).
▫ Reduced staff time spent on clerical administration and filing (22).
40. 40
Services Mix Frequency
Current Functionalities for Data Exchange 2008 2009 Change
Results delivery (e.g. laboratory or diagnostic study results) 31 44 13
Connectivity to electronic health records n/a 38 n/a
Clinical documentation 38 34 -4
Alerts to providers 26 31 5
Electronic prescribing n/a 26 n/a
Enrollment or eligibility checking 29 25 -4
Electronic referral processing 17 21 4
Consultation/referral 23 20 -3
Clinical decision support n/a 19 n/a
Disease or chronic care management 19 19 0
Quality improvement reporting for clinicians 14 19 5
Ambulatory order entry n/a 16 n/a
Disease registries 11 16 5
Reminders 14 16 2
CCR/CCD summary record exchange n/a 15 n/a
Public health: case management 7 13 6
Public health: surveillance 9 13 4
Quality performance reporting for purchasers or payers 9 12 3
Connectivity to personal health records n/a 10 n/a
41. 41
Est. HIE Services Value
Is it already
Activity WTP by
Quantity performed by
Performed by stake- Cost Pricing
estimate some other
RHIO / HIE? holder
entity?
Current Services
View patient information (demographics)
View clinic observations
View clinic allergies
View clinic diagnoses and procedures
View clinic medications
View lab results
View hospital discharge summaries
View hospital radiology reports
Potential Services
Service 1
Service 2
Service N
Sample Benefits
Reduction in unnecessary tests and procedures
Save time associated with handling chart requests and
referrals
Reduction in administrative portion of test costs
Better health outcomes from rapid identification of pre-
existing conditions
Improve identification of billable patients
Reduce unnecessary ED admissions
Other benefits…
June, 2010
42. 42
Funding Sources
• Grants Maturity
• Contracts
• Debt
• Equity
• Regulated funds, such as insurer
assessments
or municipal bonds
• Revenue/Cash Flow from Operations
As the HIE matures, sustainability must be based on the quantifiable
value being created for participants willing to pay for that value.
43. 43
Economics
• Until revenues = operating costs the HIE will require funding
$
Funding
Operating costs
Revenues
Time
Today Break even Future
44. 44
Revenue Models Definition
Membership/Subscription Members pay a set subscription fee for participation, typically based on size (e.g. bed
HIE Revenue Models size, revenues). Subscription fee benefit is that for one price, participants can utilize
without counting costs of transactions. RHIOs should pay close attention in
developing pricing scheme to ensure costs and margin are covered.
Transaction Fees Participants pay a fee per transaction (e.g. for every result delivered). Transaction
fees are best when tied to direct sources of value, e.g. the receipt of electronic test
results that otherwise would have quantifiable handling costs. Transaction fees
should be avoided in instances where the fee disincentivizes data contributions to
RHIO.
Hybrid Model A common approach, in a hybrid model, certain services are included in a subscription
mechanism with other services or transactions fee-based. Those data transactions
which directly contribute to the value of the RHIO, such as data feeds from labs, such
as clinical results, are usually in the form of subscription
Sales of goods or services Revenue from selling goods, information or services. E.g implementation services,
selling cleansed data. This source of revenue is typically ancillary to core services.
Value Exchange Agreement between stakeholders (typically payers) to pay HIE for value generated
based on an agreed upon economic model. Based on premise of “shared savings”.
In April 2009, United Healthcare became the first U.S. commercial health plan to agree
to pay for HIE services for their members in California. The administration costs of
value exchange can be high and it has an additional level of complexity.
Other sources revenue: online training programs, transcription services, clinical research trials, disease management pilots.
45. 45
Benchmark Data
MHIN HealthBridge DHIN
$8,000 - $500,000 annual Tiered Subscription for DE statute requires private sector
subscriptions, ancillary services unlimited data most services. matching funds from
Business Model (interface deployment, quality, Transaction fees for select stakeholders. Working on a
EHRs) services. ―sustainable model‖.
Founded 1998 1997 1997
Funding $200K from 6 hospitals and $1.75M loan $12M
laboratory
Origination
Results reporting, ―print Clinical messaging and portal. Results delivery (EHR direct,
efficiency‖, community repository Sends information including lab clinical inbox, direct to fax),
data sourcing data, radiology/ADT Patient search function
Services information, demographics,
admissions notices, discharge
summaries, transfer notices.
Commercial Services (100%) Commercial Services (100%) Federal (1/3), State (1/3),
Funding Current Customers (1/3)
Physicians 1,000 4,400
~ 7 hospitals, 80+ total 29 hospitals, 5500 physician 3 health systems, adding 4th,
organizations users, 17 local health 800,000 patient records
Hospitals departments, 700 physician
offices and clinics
Accelerating the pace of benefit, Push system value, Stakeholder All the players at the table, Strong
broad and supportive constituency Support government support, limited
Keys to success , adding data sources. geography
46. 46
Estimating Revenue Potential
Org Type # Orgs
Services
Valued
Mean Total
Subscriptio Subscriptio
n Fee n Fees
Mean Trx
Fees
Total Trx
Fees
Potential Other Total
Revenue Services Revenue
Hospitals
Medical Clinics
Physician Offices
Skilled Nursing
Facilities
Laboratories
Pharmacies
Health Plans
Medicaid
Public Health
June, 2010
47. 47
Conclusions on
Sustainability
• Sustainability requires concerted broad public and private
stakeholders support
• Business case of respective services for each stakeholder will
determine appropriate pricing
• Interim funding will be required until sufficient operating
revenues can be achieved
• Must understand which services are valued and deliver those
services in an appropriate way that fits with workflow
• Ultimately, payment mechanisms must incentivize
participation in coordinated care and HIE use
49. 49
Sustainable Principles
from Indiana HIE
Build a nexus around key payer and provider
organizations to secure private funding
Provide a clear value proposition to
participants
Structure the deal intelligently to anticipate
challenges and change
51. 51
IHIE Sustainability
Principles
Principle 1: HIE is a Business
Principle 2: The Leveraging of High‐cost, High‐value
Assets
Principle 3: No Loss Leaders
Principle 4: Independent, Local Sustainability
Principle 5: Natural Monopoly
Principle 6: The Need for Scale
Principle 7: Avoidance of Grants for Operational Cost
52. 52
HIE is a business
P1 & P2
HIE is a business and as with all businesses, creating a sustainable HIE
requires:
offering services that the market wants…
at a price the market will bear…
doing so in such a way that revenue exceeds expenses.
services delivered by the HIE must be at a level that healthcare
organizations have come to expect from their suppliers.
Once dollars have been invested in the creation of HIE infrastructure, it is
essential to leverage and reuse those assets to deliver as much and as many
services as is necessary to achieve sustainability.
the services an HIE is able to provide to the market must be capable of
producing sufficient revenue to cover expenses
due to the cost of the infrastructure that is required, offering multiple
services to various market stakeholders is conducive to sustainability.
54. 54
No Loss Leaders
Loss leaders are goods or services ―sold at a loss‖ to
create profit through other, related goods or services
In the business of HIE, avoid loss leader services
that promise to amass data or infrastructure to
support a future sustainable service.
The HIE policy and business model landscape is
evolving too rapidly
The risk that the future services might never be
possible is too great and should not be factored into
sustainability plans
Examples include many ―secondary use‖ concepts
(e.g. information for pharma research)
55. 55
Natural Monopolies
• HIEs are natural monopolies.
▫ the total cost of producing HIE services for a given
market is lower if there is just a single producer
than if there are several competing producers.
▫ There is a large cost for the necessary
infrastructure (which is a fixed cost), making the
creation of a redundant infrastructure wasteful
and detrimental to the economy as a whole.
56. 56
Avoidance of Grants
• Grants are indispensable sources of start‐up
funds for HIEs or individual services, but should
not be counted on to cover operational costs
beyond a ramp up stage.
• Once fully operational, HIE services must be
able to generate revenue equal to or in excess of
expenses such that grants (or other
non‐operating revenue sources) are not
necessary to cover operational costs.
57. 57
IHIE Sustainability
Stuff an Services on Stuff an
HIE could which you HIE could
do to can base a do that
Help save sustainable someone
The HIE will pay for
healthcare
system
58. 58
Sources of Funding – Gov’t Focus
• The American Recovery and
Reinvestment Act (ARRA) of 2009
• Assessments on insurers
• General tax revenues
• Consumption-based taxes
While some of these revenue sources only supply short term investments
(e.g., HITECH, consumption-based taxes), others have the potential to
provide funding for HIE over the long term. Also, to the extent that direct
funding may be inadequate to cover the start-up expenses for establishing
mechanisms for HIE, loans and other forms of financing may also be
required. - SERVICES
59. 59
Participation / Stakeholder Value
A common thread running through many of these
approaches is the need to establish operational criteria
for what constitutes engaging in HIE for each
stakeholder. These criteria would be necessary in
legislation or regulations to determine (depending on
which options are implemented)
Which Stakeholder is eligible for incentive
payments; meet participation requirements; or
qualify for loans, grants and tax incentives.
60. 60
Financial Approaches
Leverages Public Policy for Sustainability
61. 61
Integrating Approaches
Leverages Public Policy for Sustainability
64. 64
Promoting HIE 1 of 2
Governance Entities: States could support the development of sustainable state-level HIE governance entities or of regional or
other forms of HIOs through various financial mechanisms such as appropriations (i.e. budgetary spending), grant and contract
funding, and agency operational funding.26 Such an effort may have an initial emphasis on ensuring that providers and insurers
involved in Medicaid and state employee health benefits plans have access to a mechanism for exchanging health information.
Public Utility Model: States could use grants to establish HIOs that are heavily regulated private entities where supply is
guaranteed and prices are structured following a public utility model.
Private Matching Funds: States could leverage federal funds by requesting that governmental funding be matched by similar
contributions from the private sector. This could help stimulate initial buy-in from large Healthcare stakeholders who would
substantially benefit from predominately state-sponsored HIE. As the regulators of health insurers, states could assess health insurers
a set amount per member or transaction—an approach being used in Vermont. (However, an Employee Retirement Income Security
Act (ERISA) exemption might be required to allow those assessments to extend to self-insured plans.)
Carrots and Sticks for State Insurers and Providers: Consistent with the discussion of the FEHBP in the federal approach,
states could develop a series of carrots (reimbursement, start-up funding) and sticks (participation requirements) to providers or
insurers who take part in providing health benefits for state employees.
Licensure and Accreditation: Engagement in HIE could be integrated into the licensing and accrediting of Healthcare facilities
and states could support the development of accreditation standards and processes for HIOs. Additionally, education designed to
help providers use HIE to improve the quality and efficiency of care could be developed and could count towards continuing
education requirements for physicians, pharmacists and other providers.
65. 65
Promoting HIE 1 of 2
Health Planning: Assessing the ability of a provider to engage in HIE could be incorporated into health planning efforts. For
example, if a hospital decides to upgrade its health information technology system, it could be required to demonstrate plans to
engage in state-level HIE as part of an application for a certificate of need (CON). (This strategy has been adopted by the State of New
York.)
Direct Funding: States could pass along direct funding to providers, for example by distributing grants or loans or implementing
tax incentives, to support start-up expenses of providers who could demonstrate a plan to integrate HIE into their workflow to
improve the quality of care. Direct financial support might be particularly important to subsidize public health reporting and HIE for
safety net organizations—two areas that are unlikely to be initiated by market demand.
Technical Assistance: States could ensure the availability of technical assistance to help providers effectively engage in and sustain
HIE through either the direct provision of such assistance or by entering into contracts with third party vendors and generating a
volume discount that could be passed on to providers. These state TA efforts could complement the assistance incorporated in
HITECH.
Malpractice Insurance Premiums: States could work with malpractice insurers to encourage them to reduce premiums for
entities who engage in HIE. (Some medical malpractice companies do reduce premiums for HIE; however expanding the number
who do so, or making those premium reductions more sizable, may prove challenging if there is insufficient actuarial data to support
these reductions. A potential role for state or federal governments would be to conduct research to demonstrate the association
between patient safety and participation in HIE.) Another strategy, which could break down an even greater barrier for providers, is
enacting state law to indemnify providers who follow set privacy and security guidelines against liability for damages (or create a state
fund to cover those damages) resulting from breeches in security or other risks that providers who take reasonable precautions may
be exposed to by engaging in HIE.
66. 66
Original 10 Gov’t Funded RHIO
1) Colorado Health Information Exchange
2) Indiana Health Information Exchange
3) Maryland D/C Collaborative for Health Information
Technology
4) MA-SHARE/MedsInfo-ED ePrescribing Initiative
5) Santa Barbara County Care Data Exchange (CA)
6) HealthBridge (OH)
7) Taconic Health Information Network and Community
(NY)
8) Tri-Cities TN-VA Care Data Exchange
9) Whatcom County Health Information Exchange (WA)
10) Wisconsin Health Information Exchange.
67. 67
Examples of Value
Value Creation at the Point of Information Exchange
A HIE is an operational entity that facilitates efficient exchange between
providers of Healthcare services. In the process, it creates value by
extending participants’ capacity to extract value from the coordinated
collection of data relevant to more efficient delivery and consumption of
Healthcare services.
New England Healthcare EDI Network has reduced the costs of administrative
data transactions from $5.00 to $0.25, bringing transaction costs down from
$12.5 million a month to $625,000.
68. 68
Advance Exchange
Value
Redefine the role of HIEs as clinical data and information intermediaries
(infomediaries) by expanding their customer base
Re-conceive the role of RHIOs not as local non-profits that build everything de novo,
but as social capital generators that build the necessary trust relationships needed
for health information exchange
Reform the reimbursement system so that incentives for adopting health
information technology and HIE in particular, reduce or eliminate current financial
and institutional barriers While the last of these requires the actions of policy makers
71. 71
Transactions w/ Value
Hospitals Public Health
Clinical Messaging Needs Assessment
Medication Reconciliation Surveillance
Shared EMR / EHR Reportable Conditions
Credentialing Results Delivery
Eligibility Checking Syndromic Reporting
Referral mgt
Payors
Physicians Clinical Quality Measurement
Results Delivery Claims Adjudication
Secure Document Transfer Secure Document Transfer
Shared EMR / EHR
Clinical Decision Support Researchers
Credentialing De-identified, longitudinal clinical
Eligibility Checking data
Referral mgt
Patients
LABS Personal Health Record (PHR)
Clinical Messaging
Orders
72. 72
Ingenix Route to
HIE Financial Independency
• Empower consumers. Patients receive coordinated care, actionable information, and answers to make
informed, value-based decisions based on comprehensive, standardized information.
• Empower providers. Streamlined administrative functions, comprehensive clinical insight and answers
right at providers’ desktops will allow more time for treating patients according to evidence-based medicine
(EBM), in addition to eliminating duplication and reducing risk in treatment.
• Enable state and federal governments. Providing access to data will allow states and the federal
government to better target underserved and at-risk populations with preventative measures, inform best
practices, and provide public health and bioterrorism monitoring.
• Engage payers. Reduced costs, greater value, and decreased complexity will help payers better control
administrative expense and improve operational efficiencies.
• Provide opportunity for existing clearinghouses/gateways to realign in a changing market. Although the
new model redirects spend from current clearinghouses/gateways to HIEs, it also creates opportunity for the
development of new services and innovations for companies that choose to pursue that path.
73. 73
Governing HIE Entity
An organization that oversees and governs the
exchange of health-related information among
organizations according to nationally recognized
standards. These organizations may be regionally
focused, represent multi-provider organizations such
as hospital systems and integrated delivery systems, or
include horizontal networks of providers such as
health center networks.
Notas del editor
234 known HIE’s
The last year has seen many advances in health information exchanges. The eHealth Initiative has identified and collected information on 234 active health information exchange initiatives (HIEs) in the country. Of the 234 known initiatives, 199 groups responded to and qualified for inclusion in the 2010 Annual Survey on Health Information Exchange. This year, there has been significant expansion in the field with the creation of 56 state designated entities (SDE). eHeaIth Initiative made a concerted effort to include these entities in the survey; it should be noted that 48 of the 56 SDEs completed the 2010 survey.
The last year has seen many advances in health information exchanges. The eHealth Initiative has identified and collected information on 234 active health information exchange initiatives (HIEs) in the country. Of the 234 known initiatives, 199 groups responded to and qualified for inclusion in the 2010 Annual Survey on Health Information Exchange. This year, there has been significant expansion in the field with the creation of 56 state designated entities (SDE). eHeaIth Initiative made a concerted effort to include these entities in the survey; it should be noted that 48 of the 56 SDEs completed the 2010 survey.
The last year has seen many advances in health information exchanges. The eHealth Initiative has identified and collected information on 234 active health information exchange initiatives (HIEs) in the country. Of the 234 known initiatives, 199 groups responded to and qualified for inclusion in the 2010 Annual Survey on Health Information Exchange. This year, there has been significant expansion in the field with the creation of 56 state designated entities (SDE). eHeaIth Initiative made a concerted effort to include these entities in the survey; it should be noted that 48 of the 56 SDEs completed the 2010 survey.
The last year has seen many advances in health information exchanges. The eHealth Initiative has identified and collected information on 234 active health information exchange initiatives (HIEs) in the country. Of the 234 known initiatives, 199 groups responded to and qualified for inclusion in the 2010 Annual Survey on Health Information Exchange. This year, there has been significant expansion in the field with the creation of 56 state designated entities (SDE). eHeaIth Initiative made a concerted effort to include these entities in the survey; it should be noted that 48 of the 56 SDEs completed the 2010 survey.
Are initiatives allowing patients to opt-in or opt-out?There continues to be a lot of discussion around opt-out/opt-in policies. Ninety-eight initiatives responded that their state allows them to choose either an opt-in or opt-out policy. However, 40 initiatives, 19 of which are state designated entities, responded that they are unaware of state legal requirements that do not allow an opt-out policy. Only 36 initiatives have an opt-in policy where patients must give consent to have their data included. Eighty-one initiatives have an opt-out policy, where patients’ data is automatically included but they can choose to withdraw. Twenty-seven initiatives were unsure of their policy, and 56 chose not to answer. Initiatives overwhelmingly use a global opt-out/opt-in policy with 61 responding this was their policy.
Most health information exchange initiatives are leaving it up to points of service to inform patients their health information is accessible through the initiative. Sixty-six respondents said that patients are notified through the Notice of Privacy Practices (NPP) of participating Healthcare providers, with anumber of initiatives (11) writing in a variation of this under Other. Only 18 initiatives notify patients themselves, and 8 said that patients are not notified.
Most non-SDE initiatives are operating at a multi-county coverage area. Fifty-five initiatives report covering a multi-county area, while 21 initiatives report covering an entire state. Other coverage areas include: 17 at a multi-state level, 11 at a county level, 7 at a metro level, 5 that do not cover a geographic area, and 6 initiatives that cover another area such as part of a city or county, or are working with a specific population group.
The last year has seen many advances in health information exchanges. The eHealth Initiative has identified and collected information on 234 active health information exchange initiatives (HIEs) in the country. Of the 234 known initiatives, 199 groups responded to and qualified for inclusion in the 2010 Annual Survey on Health Information Exchange. This year, there has been significant expansion in the field with the creation of 56 state designated entities (SDE). eHeaIth Initiative made a concerted effort to include these entities in the survey; it should be noted that 48 of the 56 SDEs completed the 2010 survey.
Stage 1 Recognition of the need for health informationexchange among multiple stakeholders in your state, region or community. (Public declaration by a coalition or political leader)Stage 2 Getting organized; defining shared vision,goals, and objectives; identifying funding sources, setting up legal and governance structures. (Multiple, inclusive meetings to address needs and frameworks)Stage 3 Transferring vision, goals and objectives totactics and business plan; defining your needs and requirements; securing funding. (Funded organizational efforts under sponsorship)Stage 4 Well under way with implementation –technical,financial and legal. (Pilot project or implementation with multiyear budget identified and tagged for a specific need)Stage 5 Fully operational health informationorganization; transmitting data that is being used by healthcare stakeholders.Stage 6 Fully operational health informationorganization; transmitting data that is being used by healthcare stakeholders and have a sustainable business model.Stage 7 Demonstration of expansion of organization toencompass a broader coalition of stakeholders than present in the initial operational model.
Regional Extension Centers (REC) as a catalyst: Cooperation among health information exchange initiatives, regional extension centers, and state designated entities is key to meeting the expedited timelines of implementation required to meet meaningful use rules. Ninety-four initiatives, 34 of which are statedesignated entities, report that they are currently working closely with a regional extension center, and 34 report they will be in the next 6 months. Twelve initiatives report that they have no immediate plans to work with a regional extension center, and 9 initiatives were unsure of who is acting as the regional extension center in their area.
Most health information exchange initiatives are leaving it up to points of service to inform patients their health information is accessible through the initiative. Sixty-six respondents said that patients are notified through the Notice of Privacy Practices (NPP) of participating Healthcare providers, with anumber of initiatives (11) writing in a variation of this under Other. Only 18 initiatives notify patients themselves, and 8 said that patients are not notified.
Most health information exchange initiatives are leaving it up to points of service to inform patients their health information is accessible through the initiative. Sixty-six respondents said that patients are notified through the Notice of Privacy Practices (NPP) of participating Healthcare providers, with anumber of initiatives (11) writing in a variation of this under Other. Only 18 initiatives notify patients themselves, and 8 said that patients are not notified.
Capitation. Much has been written about capitation, However, one of the promises of creating new incentives for quality and HIT adoption is making it worth providers’ while to invest in EMRs. Any payment technique that creates a fixed budget over a population or a span of care achieves something fee-for-servicedoes not: it allows for a budgetary process with room for capital allocations for reengineering and care improvement, including investments in HIT. Whatever criticisms can be mounted against capitation, one positive aspect has manifested itself in large integrated delivery systems (IDS) and independent practice associations (IPA) that accept global and sub-capitation: they have large capital budgets in which management can make allocations for HIT investment. There are many examples in California, where capitated provider systems have made major investments in EMRs. While this in itself does not bring about interoperability between systems, it does prove that fixed budget payments create both incentives and available capital to invest in HIT.Pay for Performance. Pay-for-performance is riding a wave of increasing preeminence in the ongoing challenges to unlock efficiency gains in US Healthcare. In a recent survey article appearing in the Annals of Internal Medicine (the PWUDS study), the authors of the study question the base of knowledge that is driving the emergence of pay-for-performance in the market. While most studies document an increase in measured indicators of quality when financial incentives are introduced, there is considerable room to question the significance of these findings. The jury may still be out as to whether pay-for-performance programs will bring about the desired change, but one thing is for certain: the widespread and growing adoption of incentive programs has legitimized differential pay; which is to say, purchasers now recognize that not all providers are equal, and are now ready to recognize top performers with top pay. But there is unease about pay-for-performance even among its advocates, and one of the reasons is that most incentives are layered add-ons over a fee-for-service system that still remains unchanged. Wouldn’t it be more effective to go straight to the heart of matter and reform the very basis of fee-for-service reimbursement?Global Fees for Episodes of Care. The American system of reimbursing Healthcare providers renders few rewards for delivering high quality care. It is often the case that improvements on behalf of physicians to re-engineer care can leave them making less money. And it is not just a lack of incentives to improve care that is worrisome; the existing payment system actually entrenches poor quality care. The Institute of Medicine labeled the current payment system “toxic.” That fact,combined with widening knowledge about real gaps between the quality of care provided and what best evidence guidelines would suggest, has spurred activity byhealth plans to make extra money available to providers who meet quality benchmarks. One way to alter the current regime would be to reimburse care not through fragmented unit pricing (fee-for-service) nor through actuarial pricing (capitation), but through production pricing: a fixed budget compensating episodes of care as individual patients experience them and the services required for providers to produce them. Where an episode of care is defined as the complete sequence of interactions between a patient and providers of healthcare services in pursuit of a defined clinical objective over a specified period of time, it may be more sensible to make episodes the natural unit of reimbursement.Taken in that context, then, globally pricing episodes of care create the equivalent of an upfront sticker price on clinically homogenous pathways, whether acute or chronic, so that: (1) patients have a predictable measure of the cost of medical treatments(2) providers have an incentive to organize and re-engineer treatments around clinicallyhomogenous care paths rooted in evidence-based guidelines(3) plans can measure the cost and effectiveness of integrated care teams(4) risk-based contracting avoids the pitfalls of capitation and gradually erodes the predominance of fee-for-service purchasing; and(5) patient choice at the point of service becomes the engine of efficiency instead of the driver of inflation.
First, are your revenue projections sound and sustainable?Second, are your expense projections reasonable and can you provide the promised level of service within these expense restrictions?Third, can you hire and retain the quality of staff you need to operate the RHIO within the expense projections?Finally, can you fund your ongoing capital requirements and expansion plans within the net profit margin? If the answer to each of the questions is positive, you are ready to begin building your sustainability model.
HIE Lit Review: Prior literature has identified three critical success factors in the broader framework of business models that may be responsible towards a successful HIE. First, studies argue that careful crafting and consideration of the operational, financial and societal returns in the business model will ensure smooth and streamlines processes of the HIE organizational structure (Hayward, Warren and Sykes 2007; Miller and Miller 2007). Second, specifically incorporating a plan for comprehensive evaluation of the return on investments will ensure that the HIE is moving as per original plan to achieve its objectives (Hripcsak et al. 2007). Third, the regulation and financial structure in the healthcare sector also shapes the success or failure of the HIE (Frisse 2005).
Maffei et al (2009) “Determining Business Models for Fin Sustainability in RHIOs.” Population Health Management Vol. 12 (5)
Based on the experience of 6 years of operation and an on‐going history of service development, launch, and support, IHIE bases its sustainability plans seven basic principles.
Based on the experience of 6 years of operation and an on‐going history of service development, launch, and support, IHIE bases its sustainability plans seven basic principles.
Based on the experience of 6 years of operation and an on‐going history of service development, launch, and support, IHIE bases its sustainability plans seven basic principles.
ARRA - The recently passed stimulus package provides over $20 billion in funding for health IT. These provisions, known collectively as the Health Information Technology for Economic and Clinical Health (HITECH) Act, include $2 billion allocated for ONC and $17.2 billion going to Medicare and Medicaid reimbursement incentives to encourage adoption of EHRs. The incentives for EHR adoption will only be provided over the next five years to those with certified EHRs that include patient demographic and clinical health data, as well as clinical decision support with physician order entry. Eligible professionals must also demonstrate “meaningful use” of the technology. This standard will be determined by the Secretary of HHS and will require the capability for the electronic exchange of health information to improve the quality of care and the ability to submit clinical quality measures. Over time, the incentive for EHR adoption in Medicare will disappear and a penalty will be imposed for those who are not meaningful users of EHRs. Although the bulk of this investment is directed towards promoting the adoption of EHRs, the law also includes a more limited pool of money to support standards and policy development and to provide seed funding to help build infrastructure for data exchange. Funding from HITECH will certainly facilitate electronic exchange of health information—particularly if “meaningful use” is defined in such a way that HIE is an integral component—but it does not establish a solution for the long-term economic sustainability of HIE. Assessments on Insurers-States could impose an assessment on all insurers on a per member basis or a charge per claim. (Federal action might be required to allow states to levy such an assessment on self-funded plans.) This policy lever would eliminate the barrier created by insurers who may be less willing to invest in the infrastructure for HIE that would benefit patients not covered by their plans. General tax revenues-If HIE is considered a public good that accrues benefits to all Americans, an increase in taxes for all citizens might be appropriate. Consumption-based taxes-Taxes could be raised on items like tobacco. Tobacco taxes have been criticized in the past as unreliable sources of long-term funding. Because raising the price of tobacco products is an effective deterrent to new users, revenues diminish over time. While this reduction is a problem for ongoing programs, federal funding for HIE is often viewed as primarily serving a “start up” or “seed money” role, rather than providing an ongoing subsidization by the taxpayers, so this type of tax may be well designed for the policy purpose at hand.
Nonfinancial Assistance. This approach envisions a continued government role in providing technical assistance, education, coordination and dissemination resources. It calls for the continuation, or potential expansion, of existing projects on standards, assimilation of privacy regulation, certification of HIE-related software and other ongoing projects to lessen barriers to HIE participation. Many of these activities are essential to lay the groundwork for the exchange of health information. As such, this approach may be seen as a necessary (although likely insufficient) piece of any effort to promote widespread HIE engagement. Federal Government Focus. This approach calls for modifying legislation and rules governing all federally underwritten Healthcare benefits and services including those led by the Centers for Medicare and Medicaid Services, the Federal Employees Health Benefits Program, the Veterans Health Administration, the Indian Health Service, the Department of Defense and others to reflect the need for greater public and private sector investment in HIE. Key components of this approach include looking at conditions of participation in HIE as a prerequisite for payers and providers to participate in federally underwritten programs and adjustments to reimbursement to payers and providers under federal programs to create new incentives to participate in HIE. State Government Focus. This approach is similar to the federal approach, only it focuses on levers available to state officials. This approach could involve direct subsidies to states to establish HIOs in areas where there are currently limited options for providers and payers seeking to participate in HIE. Given the current financial circumstances of most states, federal grants to states would be required; however, governance and administration of policies developed through these grants could take place on the state level. In addition, states would be able to lead modifications in licensure, malpractice and provider regulation where they have jurisdiction. Key components of this approach could also include modification of state Medicaid plans to establish reimbursement rules to support HIE, new licensure requirements for Healthcare facilities and practitioners, adjustment of malpractice premiums to support HIE, modifications to state employee health benefits plans and other programs and initiatives supported and governed on the state-level. Private Sector Focus. This approach directly subsidizes establishment and participation in HIE by granting tax advantages for HIE-related expenditures by for-profit entities or a combination of tax advantages and direct grants to for-profit and non-profit providers and payers to cover the costs of establishing and participating in HIE. Another way the tax system could promote HIE is by making the existing tax advantage for employer-sponsored insurance contingent on benefit plans engaging in HIE. The approach also includes subsidies for HIOs, such as a guaranteed loan program.
Delaware established its system it received $5-million from the state, $2-million from the private sector, and $5-million from the federal AHRQ for start up.At the same time, New York is investing more than $200 million to support health IT adoption and the development of an interoperable health information infrastructure.
To understand how information exchange creates value, it is necessary to establish the institutional and market linkages between users and producers of information. On one side of the market exchange, individuals and intermediaries present themselves, as users, in anticipation of enhancing their well-being through an exchange. On the other side, individuals and organizations offer products and services they hope will appeal to users at a profit. It is in this context that the HIE network operates as an intermediary to facilitate mutually beneficial exchange and value creation.
Based on the experience of 6 years of operation and an on‐going history of service development, launch, and support, IHIE bases its sustainability plans seven basic principles.
Physician, improvement, efficiency, and outcomes measurement Performance management Program integrity Fraud and Abuse Identification and Prevention Population monitoring and predictive profiling Care Gap Identification Care/Disease Management Population Health Analysis Public Health Monitoring Clinical Research