Are HIEs Ready for Accountable Care?

The Obama Administration shepherded through the HITECH Act in 2009 to accelerate adoption of information technology to support the health care reform initiative, which heavily relies on I.T. and health information exchange to manage a new health system centered on the patient, value and outcomes.

One of the centerpieces of the effort was support for the development of health information exchanges. The government threw $564 million into the effort to create statewide HIEs, and some states followed suit with their own financial support.

But the big question facing the industry is what role, if any, HIEs can and will play in supporting the newest federal idea: accountable care organizations. As of February 2013, there were more than 250 Medicare ACOs, according to the Centers for Medicare and Medicaid Services; in a Health Affairs article published in February, David Muhlestein, an analyst at research/consulting firm Leavitt Partners, pegged the total number of ACOs at 428.

ACOs are booming, and as of right now, there seems to be enough HIEs to support them. However, the future of HIEs is extremely murky due to the problem that has plagued the information exchanges since their conception-financial sustainability.

Stakeholder advocacy group eHealth Initiative assessed the state of HIEs in the United States in 2012 and identified 222 public and private HIEs, down from 255 in 2011.

A total of 161 HIEs responded to the organization's annual survey, the results of which highlight a big problem: Only 29 HIEs reported themselves as being financially self-sustaining. Ninety-three HIEs in 2012 said they were "highly likely" to be in business in three years, and 64 of those believe they will be financially sustainable within the next three years.

However, nearly half of those optimists currently depend on federal funds as their primary revenue source. And the $564 million in federal funding awarded to state HIEs under the HITECH Act stops in October 2013, with currently budgeted state funding sources expected to dry up by March 2014.

The creation of ACOs on its face seems to provide a financial shot in the arm for financially struggling HIEs, since ACOs hinge on connectivity and data exchange, which plays into what HIEs are offering.

But the eHealth Initiative survey also indicates that ACOs likely won't find the kind of data networks they could pay to piggyback on: Only 24 HIEs in 2012 reported being able to offer value-added services such as advanced data analytics, quality reporting, clinical decision support, and PACS reporting, all of which are services needed just as much by value-based programs as the actual exchange of data.

So what happens to providers who today are assuming significant financial risk in joining value-based programs that rely heavily on HIE capabilities that simply may not be available? Is the Obama Administration moving too fast on value-based programs without a capable national HIE infrastructure in place, or are HIEs ready for today's and tomorrow's demands?

Let the debate begin as providers, payers, consultants, vendors and the Office of the National Coordinator for Health Information Technology weigh in on the status and promise of HIEs in the June cover story of Health Data Management.