Assessment Released of Health Information Exchanges (Part 1 of 2)

Like my Boston-area neighbors who perennially agonize over the performance of the Red Sox, healthcare advocates spend inordinate amounts of time worrying about Health Information Exchanges (HIEs). Will the current round of exchanges work after most previous attempts failed? What results can be achieved from the 564 million dollars provided by the Office of the National Coordinator since 2009? Has the effort invested by the government and companies in the Direct project paid off, and why haven’t some providers signed up yet?

I too was consumed by such thoughts when reading a reported contracted by the ONC and released in December, “HIE Program Four Years Later: Key Findings on Grantees’ Experiences from a Six-State Review. Although I found their complicated rating system a bit arbitrary, I found several insights in the 42-page report and recommend it to readers. I won’t try to summarize it here, but will use some of the findings to illuminate–and perhaps harp on–issues that come up repeatedly in the HIE space.

Can Anything Keep HIEs Afloat?
The HIE Program report focuses on businesses or non-profits that store and transmit data–what advocates like to call “HIE as a noun.” Grammatically speaking, HIE is a noun no matter how the phrase is used, but advocates like to contrast the stand-alone businesses with a free-flowing form of data exchange between health care providers without intermediaries. Unfortunately, privacy and security considerations require an intermediary for almost all patient data exchanged in health care, because even the point-to-point Direct protocol requires correspondents to validate each other, a centralized function.

Above all else, the report is concerned with the same topic that most studies of HIEs have focused on: sustainability. Like other studies, this one concluded that HIEs needed to be more than a substitute for fax machines: they need to offer services such as analytics and alerts for at-risk patients. The report refers to such services as “care transformation” (p. 26). These services in turn appeal only to providers who have pay-for-value reimbursement plans, because otherwise the analytics and alerts add no value.

Exchanges seem to reflect the same economic dynamics that characterize the rest of the US health industry: they’re quite heavyweight. Small providers have trouble affording them. This leads to a marketing paradox: the large providers who have both the funds to support HIE and the infrastructure to use it are the very ones likely to find separate solutions. Whether as ACOs or just large conglomerates, they like to exchange data internally and are actually disincentivized to send data to outsiders (p. 16).

Indeed, I’ve heard from contacts in the field that doctors don’t see the value of health exchange. The impression is partially confirmed by this report, which admits that even the HIEs themselves lack incentives to exchange data outside the networks of their own clients (p. 27).

Even pouring hundreds of millions of dollars into HIEs is not enough: they require regulatory pressures, such as public health data reporting or Meaningful Use requirements, to drive adoption (pp. 13-14). Such regulation could start looking uncomfortably close to extortion in the service of supporting unsustainable HIEs. Furthermore, because health providers place so much stress on adapting to regulatory requirements, any mismatch between the HIE offerings and the goals of Meaningful Use leads to a train-wreck (p. 18).

Well, it’s a tough market out there. HIEs are not alone–a lot of providers have their own concerns about survivability. The irony is that good health information exchange could give them a new lease on life–but current HIEs mostly drain their funds.

In the next installment of this article I’ll look at issues of data control and privacy, along with some other aspects of HIEs described in the report.

About the author

Andy Oram

Andy Oram

Andy Oram writes and edits documents about many aspects of computing, ranging in size from blog postings to full-length books. Topics cover a wide range of computer technologies: data science and machine learning, programming languages, Web performance, Internet of Things, databases, free and open source software, and more. My editorial output at O'Reilly Media included the first books ever published commercially in the United States on Linux, the 2001 title Peer-to-Peer (frequently cited in connection with those technologies), and the 2007 title Beautiful Code. He is a regular correspondent on health IT and health policy for He also contributes to other publications about policy issues related to the Internet and about trends affecting technical innovation and its effects on society. Print publications where his work has appeared include The Economist, Communications of the ACM, Copyright World, the Journal of Information Technology & Politics, Vanguardia Dossier, and Internet Law and Business.


  • Looking forward to your next posts. Direct is really changing a key selling point for HIE membership, which was already struggling to provide any ROI to subscribers/participants. State public health HIEs will continue thanks to MU and also because they are more collectors of data for trend analysis, rather than a source of exchange.

    Another sticking point I’ve heard from many providers goes along this line of thought: We’ve spent millions of dollars on an EHR with all the bells and whistles to help us improve patient care, so why would I want to pay an HIE to do that for me? And, do it poorly?

  • Chad, I’ve heard different assessments of the Direct project. It seems like a good solution for physicians at the low end of technology, but is still a burden. I’d like to hear what you have to say about the second installment, where I mention Direct and DirectTrust.

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