Health information networks: A growing trend

The desire to improve physician access to information and to increase patient safety, while lowering costs, is fueling a sharp rise in the level of interest and activity among doctors and health systems in creating local health information networks.

Since April, groups of competing health care entities in Worcester, Mass.; Knoxville, Tenn.; and Mesa County, Colo.; have launched initiatives to establish community-based networks to exchange clinical health information. Network participants determine what kind of data they make accessible and under what conditions. For example, hospitals make test results, discharge summaries, medication lists, allergy notes, x-ray reports and operative reports accessible to emergency departments and community physicians. Physicians generally don't pay hookup or access fees to participate in the network but do pay for their own computers and Internet service.

Similar projects will be announced in the future, but industry observers say anyone seeking to build health networks must overcome the same obstacles that doomed the wave of community health information networks in the early to mid-1990s.

Most CHINs never moved beyond planning because they carried price tags of tens of millions of dollars, participants had different agendas, projects were driven by vendors or health systems, and the technology was inadequate.

Still, "we will absolutely see more work in this area. How successful it will be remains to be seen," said J. Marc Overhage, MD, senior scientist with the Regenstrief Institute, a medical informatics research organization that manages the Indianapolis Network for Patient Care, which has operated in central Indiana since 1995.

At this time, fewer than a dozen health exchanges are operational, approved for implementation, or in advanced stages of planning or implementation, estimates Michael Mytych, a health care technology consultant in Menomonee Falls, Wis. Those include networks in Indianapolis; South Bend, Ind.; Milwaukee; Winona, Minn.; and one expected to begin operation at the end of the year in Santa Barbara, Calif. Some of these projects revolve around a centralized database, while others use a model in which participants keep their own data but make it accessible within the network.

On July 21, the number of local health information exchanges under way expanded substantially when the Foundation for eHealth Initiative awarded $2.3 million in grants from the HHS Health Services and Resources Administration to fund projects in nine communities: Denver; Indianapolis; Waltham, Mass.; Santa Barbara; Baltimore-Washington, D.C.; Fishkill, N.Y.; Kingsport, Tenn.; Bellingham, Wash.; and Milwaukee.

Also, on July 21, Rep. Patrick J. Kennedy (D, R.I.) introduced legislation to authorize more than $2.5 billion in grants to fund the development of up to 20 regional health information networks. Under the bill, those networks would be interconnected, creating the foundation for a national health information network by 2013.

Pressure to automate

A key factor why interest in health information networks is surging is that doctors, hospitals and health systems are under pressure to improve patient safety, said Larry Garber, MD, an internist and medical director for informatics at the Fallon Clinic. The 240-doctor multispecialty group has joined forces with UMass Memorial Health Care and Fallon Community Health Plan to build a network in Worcester.

"Instead of having to call to get this information as we do now, the information will be transmitted very efficiently, so that will be a cost savings for all the organizations," Dr. Garber said. "There will also be a cost savings because we anticipate reduced adverse drug events, and that benefit should trickle down to health plans, patients and employers over time."

Another major driver is the Bush administration's decision to throw its weight behind creating a national health information infrastructure within the next 10 years, said Dr. Overhage, a general internist.

On July 21, HHS Secretary Tommy Thompson and David Brailer, MD, PhD, who in May was appointed as the country's first national health information technology coordinator, announced steps to achieve that goal. These include appointing a panel to assess the costs and benefits of health information technology and report its findings to HHS this fall.

"I think the government will do a variety of things to create funding mechanisms ... but there's not going to be a $1 billion, $10 billion or $100 billion health information infrastructure bill," Dr. Overhage said.

That means sponsors of local health information networks will still have to navigate the funding hurdle that sank the CHIN movement, observers say.

Technology also remains a hurdle but one that's not as daunting as it was a decade ago, said Alan Snell, MD, a family physician and medical director of informatics at St. Joseph Regional Medical Center Inc. The three-hospital health system successfully co-founded the Michiana Health Information Network in South Bend, Ind., in 1999. "Cost and cooperation are the biggest issues," he said.

Another key issue is having a business model to turn networks into self-sustaining operations.

"The real killer why CHINs did not get any further than they did is that very few of them paid attention to sustainability," Dr. Overhage said. CHINs received tens of millions of dollars from foundations and vendors, but lacked a business plan to become self-sufficient after they burned through their initial wave of funding and community enthusiasm for their projects, he said.

To become self-sufficient and expand the network to community physicians practicing in small practices in central Indiana, for example, INPC has begun to pass on charges for clinical messaging to the five health systems that have used the network since its inception in 1995, Dr. Overhage said. The network, which was funded through grants totaling $5 million, costs about $1.5 million annually to operate.

Michiana Health Information Network is attempting to become self-sufficient by selling monthly subscriptions for an ASP-based electronic medical records systems for $450 per physician, Dr. Snell said.

While funding will, of course, largely determine how many networks actually go live, money alone does not guarantee smooth sailing.

That's a lesson participants in the Santa Barbara County Care Data Exchange project learned the hard way. After receiving a $10 million grant in 1999 from the California HealthCare Foundation, the three-year project initially was scheduled to become operational in 2001. But testing began only a few months ago, and the network isn't expected to become operational until the fourth quarter.

A key reason for the delay is that the vendor had trouble developing the software, said Phillip Greene, chair of the Santa Barbara County Care Data Exchange.

Another factor is that health care entities were passive participants because they didn't have to put up any money, said Greene, COO of the Santa Barbara Regional Health Authority, a Medicaid managed care plan that is one of about 20 entities participating in the project.

"There wasn't a strong push to do it from the community in the first place," Greene said. "I'd recommend that nobody start something like this unless the local community is the one asking for it."

Physicians and hospital administrators must drive the effort, he said. "If we were to do it over again, we would want some control and a lot of input."