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CloudView blog

Ideas and insights to help health care providers stay informed and profitable in today's challenging health care environment.

Focus Incentives and Enable EHR Interoperability

by Dan Haley, SVP and General Counsel

As reported by Anthony Brino, researchers Arthur Kellerman, MD, and Spencer Jones at RAND Corporation recently blamed the maddeningly slow progress of electronic health record (EHR) interoperability, in part, on “misaligned incentives.”

That bit of breaking news could not have been less surprising to my colleagues at athenahealth, where we have long lamented the unintended consequences of well-intentioned (and in many ways successful) federal incentives for “meaningful use” of electronic health record technology.

Kellerman and Jones write that much EHR software currently “functions less as ‘ATM cards’... than as ‘frequent flier cards’ intended to enforce brand loyalty to a particular health care system.” This statement perfectly describes the frustration that cutting-edge innovators in EHR feel as we see the real-world implications of many of our competitors designing their products to preclude, rather than empower, interoperation.

Note the term “interoperation,” describing an activity, in place of the more common "interoperability," a passive noun. A major shortcoming of both current and pending “meaningful use” standards is that they encourage (and eventually require) the latter instead of the former. Unless actual interoperation across vendors’ systems is mandated, we will continue to see products and services that interoperate wonderfully within proprietary silos, but not at all outside of them.

Often, this is by design. Kellerman and Jones note speculation that "major IT vendors are opposed to [real] interoperability.”  That is not speculation – it is observable, even quietly acknowledged, reality. In 2013, there is still a lot of money to be made selling static software and annual renewal licenses. While the rest of the economy moves steadily to the cloud, we in healthcare still live in the ‘CD in the mail’ world that once powered Compuserve.

In what other sector is static software, delivered on a disk with a purchased license, still the norm? When we lean over the admin desk at the doctor’s office and see an interface that belongs in a museum, why do we just accept that as “the way it is” in health care? Why do we operate in the cloud in so many areas of our consumer life – using it to manage our finances, book travel, send photos, music, and video to our friends with barely a thought – yet all but ignore its existence when it comes to health IT (HIT)?

Kellerman and Jones have a thought: "What should be a robust market for reducing administrative costs… has been skewed a bit by poor planning in the rush to meet federal Meaningful Use deadlines, resulting in the need for repeated investment in software tweaks and workflow burdens for some doctors and nurses."


In other words, in the rush to get an Meaningful Use-certified EHR up and running in time to qualify for a federal pay-out, many medical providers didn't shop around. They went with familiar brand names. As a result, too many spent millions on legacy software systems that, without an infusion of federal life support, would have been extinct long ago. Those technologies, obsolete almost on the day of installation, are demanding replacement long before their amortizations run, creating a balance sheet burden along with a huge administrative headache.

So how can we correct the problem and finally see HIT start realizing its potential to revolutionize health care delivery and contain costs?

First, let’s stop accepting the notion that it is okay for health information technology to trail the rest of the economy. Stop accepting the claim, most often voiced by sellers of obsolete technology, that the routine, seamless sharing of data that occurs in every other sector of the economy cannot possibly be achieved in health care. These things are not true.

Second, let’s adjust Meaningful Use incentives to be sure they incentivize desired behaviors. Federal money that enables the purchase of technology that must be replaced in a year or three is wasted federal money. Sure, nobody intended to subsidize technological dinosaurs with federal dollars, just as nobody intended Meaningful Use dollars to fund proprietary information silos, locking doctors and information into closed systems and driving up costs. But that is what’s happening. We need to focus the subsidies by tightening the definition of “meaningful use,” requiring actual interoperation between vendor systems.

Finally, government needs to make the changes necessary in law to enable a true market for health information exchange. Policymakers dance constantly around explicit acknowledgement that, in order for a major sea change in any learned behavior to occur, there needs to be a financial incentive for that behavior to change. What are federal incentive payments, after all, if not acknowledgement of that truth? But temporary, targeted incentives can only motivate so much change. And government, for all its largess, cannot (and should not) subsidize behaviors in perpetuity.

To empower health information exchange, we need a functioning market for health information -- the ability for a custodian/curator of data to charge a fair market fee to deliver to a recipient exactly the information the recipient requests, in the form requested. Markets for such information exist all over our economy – finance, insurance, auto parts -- but not in health care.

Like the industry’s technology, our conception of market dynamics in health care remains hopelessly behind the times.Under laws intended to prevent self-dealing in referrals, a fee paid for quality information could be deemed a “kickback.” As a result, virtually nobody curates the vast stores of electronic health data that we are steadily amassing, and nobody leverages the power of that data to, yes, reduce costs, increase efficiency, and improve care. That needs to change.

A functioning, two-sided market for health information exchange would not only spark a revolution in such exchange, it would also fund itself with nary a taxpayer dollar required.

In the meantime, it is great to see 2013 kicking off with some much-needed attention to the flip side of the considerable progress in EHR adoption achieved by the Meaningful Use program. Onward and upward in the New Year. The cloud is up, incidentally…

A version of this post was published on the Government Health IT website.

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