Editor’s Note: Efforts to digitize the U.S. healthcare system and make it possible to exchange health information electronically have been underway for more than a decade. Manatt Health has created a new report for the California Healthcare Foundation taking stock of the nation’s health information exchange (HIE) progress and summarizing the opportunities and challenges that lie ahead. The report describes the HIE landscape as it stands today, nearly 10 years after the creation of the Office of the National Coordinator (ONC) and 5 years after the passage of the Health Information Technology for Economic and Clinical Health Act (HITECH). It assesses the nation’s HIE efforts in three areas: electronic health record (EHR) adoption; standards, certification and incentives for HIE; and governance. Below is a summary of key highlights. Click to download the full report.

HITECH: Federal Dollars Spur Adoption and Use

The modern era of HIE-related public policy began in May 2004 with the appointment of the first national coordinator for HIT and the release of the federal government’s first comprehensive HIT strategy document. At that time, however, federal support for HIT did not have significant funding and therefore focused primarily on the private sector.

In 2009, Congress passed HITECH as part of the American Recovery and Reinvestment Act. HITECH’s cornerstone was the Medicare and Medicaid EHR Incentive Programs, which provide hospitals and professionals with financial incentives for the “meaningful use” of EHR technology to improve patient care. In 2015, the Medicare program will transition from offering incentives to imposing penalties on those not meaningfully using EHRs.

The U.S. Department of Health and Human Services (HHS) originally envisioned that the Meaningful Use Incentive Programs would evolve through three stages over five years. In December 2013, however, it proposed to extend the timeline by two years. Stage 1 focuses on EHR adoption, basic electronic data capture and medication ordering. Future stages require providers to use EHRs for exchanging health information and improving care, efficiency and population health. In addition to establishing the EHR Incentive Programs, HITECH allocated more than $2 billion for HIT and HIE infrastructure development.

EHR Adoption Rate Growth and Gaps

The adoption of EHRs has increased dramatically since HITECH was implemented in 2010. Adoption rate highlights include:

  • 44% of hospitals had adopted EHRs in 2012, up from just 17% in 2011.
  • As of February 2014, HITECH’s Regional Extension Center (REC) program has worked with nearly half of the nation’s primary care providers, helping 90% of those adopt EHRs and 62% demonstrate stage 1 meaningful use.
  • According to the 2013 National Ambulatory Medical Care Survey, nearly 80% of office-based physicians report using an EHR system.
  • As of December 2013, the Medicare and Medicaid EHR Incentive Programs had paid almost $19 billion to 335,000 professionals and 4,400 hospitals.

Despite the widespread increase in EHR adoption, serious gaps remain. Providers in rural and low-income areas, as well as long-term care and behavioral health providers, have lower adoption rates than the general provider population.

Concerns Around the Meaningful Use Program

While most agree meaningful use has been an effective policy lever in Stage 1, some believe it could impede further EHR adoption. Concerns include:

  • Stage 2 may be moving too quickly and be too complex in its requirements.
  • Meaningful use may prevent providers from using EHRs to their full potential by putting completing the program’s steps before improving health outcomes.
  • There are too many meaningful use measures that are too tactically focused.
  • The role of EHRs in care coordination and analytics is being overemphasized.

Standards and Certification—Federal Government Efforts

As it was 10 years ago, achieving interoperability—the ability of two healthcare providers to exchange data and present it in an understandable manner to patients—continues to be an important HIT goal. Despite the inclusion of standards in the meaningful use program, however, the healthcare system has yet to achieve interoperability. The current federal strategy for developing and adopting HIE standards is articulated in a June 2013 report to Congress from ONC. According to the report, ONC’s approach includes:

  • Supporting flexible, incremental and modular standards.
  • Selecting standards that work for the future.
  • Making incremental changes with community feedback.
  • Supporting implementation and precertification testing.

Standards and Certification—Private and State-Based Efforts

State and private sector players have contributed to standards development. In February 2011, 19 states and 43 EHR/HIE vendors formed the EHR Interoperability Workgroup, which released its first set of functional, technical and test specifications in 2013.

In March 2013, a coalition of EHR vendors formed the CommonWell Health Alliance to address the problem of interoperability. The alliance will initially certify core interoperability services and standards for vendors to embed in their software. The services the alliance will test in its 18- to 24-month proof-of-concept phase include:

  • Cross-identity management services—identifying patients as they move among settings, regardless of the underlying software.
  • Patient consent and data access management—providing a HIPAA-compliant, patient-controlled way to simplify managing consents and authorizing data sharing.
  • Patient record location and directed query services—delivering a history of recent patient encounters and, with the right authorization, patient data across multiple providers and care episodes.

HIE Incentives and Payment Reform

In addition to requiring compliance with technological standards, the federal government has sought to encourage HIE through payment incentives, beginning with meaningful use requirements and now including the payment reform provisions of the ACA. Experts agree, however, that widespread HIE won’t occur until new payment approaches, such as bundled payment options, accountable care organizations (ACOs) and medical home initiatives, create the case for information exchange. According to many experts, HITECH was meant to be coupled with ACA-style payment reform provisions.

The ACA includes a series of new payment and delivery system initiatives that, in some measure, require better HIT systems. For example, to function successfully, ACOs need timely access to performance metrics, patient events and patient status information. The proliferation of ACOs is a contributing factor to large health systems’ desire to build or procure their own HIEs. State efforts to redesign their Medicaid programs to reward more efficient and coordinated care also are drivers of HIE.

HIE Governance

HIE governance refers to the establishment and oversight of common behaviors, policies and standards that enable trusted HIE among a set of participants. While the need for governance is widely recognized, the last 10 years have not brought a consensus on the nature or extent to which governance is required at the national, state, regional or community levels.

There have been several efforts at the national level to establish HIE governance, none of which have been successful. With the passage of HITECH, Congress required ONC to establish a governance mechanism for the Nationwide Health Information Network (NHIN). Public feedback, however, indicated that market conditions were not right. Therefore, ONC decided instead to define general principles for supporting HIE. In May 2013, ONC released the “Governance Framework for Trusted Electronic Health Exchange” outlining four categories of principles for HIE governance:

  • Trust principles provide guidance on patient privacy, meaningful choice and data management.
  • Business principles focus on responsible financial and operational policies, emphasizing transparency and patients’ best interests.
  • Technical principles prioritize standards to support trust and business principles, as well as to further interoperability.
  • Organizational principles identify approaches for good governance.

In addition to national efforts, there have been a number of state-level HIE governance initiatives. One major effort was the 2009 launch of the State Health Information Exchange Cooperative Agreement Program. Through this program, ONC provided $564 million in HITECH funds to states and state-designated entities for developing plans that address statewide policy, governance, technical infrastructure and business practices in support of HIE.

ONC’s support is winding down as funding was from 2010 through 2013. The future of state initiatives will rest on whether stakeholders decide to provide continued financial support.

Conclusion

Nearly a decade after the establishment of the ONC and five years after the passage of HITECH, the U.S. is progressing with harnessing the power of health information to support more cost-effective and higher-quality care. The combination of government initiatives and market forces is propelling the nation forward to a time when creating, sharing and using electronic information to improve healthcare decision making and management will be commonplace.