In March, the HHS Office of the National Coordinator for Health Information Technology finished doling out $548 million in economic stimulus funds for 56 states and territories to establish state health information exchanges that will leverage the work of existing HIEs, fill remaining data exchange gaps and connect to the emerging nationwide health information network. The effort will be led by "state-designated entities" charged with overseeing development of links that enable every state provider to have access to patient records created and stored elsewhere.

The infusion of more than a half-billion dollars certainly is helping states jump-start HIE activities. But while the concept of HIEs has been around to some degree for three decades, acceptance hasn't come close to approaching a critical mass.

An annual survey last June and July from Washington-based advocacy group eHealth Initiative found 234 active HIEs-73 of them considered operational-in a nation of 310 million people spread across nearly 4 million square miles. That compares with 193 HIEs in 2009 with 57 being operational.

Among the 234 identified HIEs this year, 199 responded to the survey, and 48 of those were state entities, most of which did not exist before the stimulus law and its HITECH Act were enacted in February 2009.

The 199 respondents reported that financial sustainability remains an elusive goal for many: 107 are not dependent on federal funding, but only 18 broke even in the past year on operational income alone.

So while federal funds have enabled state HIEs to gestate, the money is not nearly enough to get them birthed and walking on their own, says Devore Culver, CEO at HealthInfoNet, an exchange in Portland, Maine. The exchange will operate the statewide HIE under a contract with the ONCHIT. The state government received $6.6 million in stimulus HIE funding, of which HealthInfoNet will get about $4.4 million.

But the federal funds represent only 17 percent of what the HIE needs, and the bulk of its ongoing budget needs to come from user subscriptions. "We're pretty good for the next six or seven months," Culver said in September. "If we don't develop additional revenue lines by then, we'll be struggling a bit."

The cover story of November's issue of Health Data Management, "HIEs: The $500M Gamble," gives a status update of state HIE initiatives and the challenges that lie ahead.

--Joseph Goedert


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