Health Information Exchange: Value, Incentives, and How to get

there.

David C. Kendrick, MD, MPHAsst. Provost for Strategic Planning, OUHSC

Medical Director for Community Medical InformaticsOU School of Community Medicine

Greater Tulsa Health Access Network

Agenda

• HIE Ongoing benefits: Value aside from ARRA– Financial– Clinical

• New, one-time opportunities: ARRA Incentives in Oklahoma Terms

• How do we get there?

OK

2007 COMMONWEALTH FUND ReportState Scorecard Summary of Health System Performance

2009 State of the State’s Health Summary

Oklahoma is the only state where the death Oklahoma is the only state where the death rate has gotten worse…..rate has gotten worse…..

800

850

900

950

1,000

1,050

1980 1985 1990 1995 2000 2005

Tulsa

US

Some Factors1. Economic downturn

healthy people and jobs left Oklahoma

2. Poverty remained3. Heart Disease –

(Diabetes)4. Cancer 5. Access to Care6. Obesity

Age-adjusted Death Rates

Past 25 Years

Current Situation

PayersDemographicsMedical claims

Pharmacy claimsCase mgmt records

Doctor officesEHR

ClaimsRx

Case mgmtCommunity outreach

Rx

Imaging

Hospitals (inpt)

ER/UC

Public Health

Other PCPs

Specialists

Ancillary carePT/OT/Aud/Diet

Labs

Manual connection (mail, fax)Electronic connection

Safety Net Clinics and community

agencies

Patient

What’s the value of HIE?

• 2004: Harvard Center for IT Leadership published a report on the value of health information exchange• $77B in annual savings through Health IT• Prompted, in part, the creation of the Office of the

National Coordinator for Healthcare IT (ONCHIT), the Health IT “Czar”

• 2006: GKFF commissioned an OK-specific evaluation of the value of HIE

Motivation

• Clinicians have incomplete knowledge of their patients – Relevant patient data not available in 81% of

ambulatory visits Tang 1994 – 18% of medical errors that lead to ADEs due to

missing patient information. Leape JAMA 1995

• Medicare patients see an average of 5.6 different providers each year= 5.6 silos of data

• What is the value of HIE for Oklahoma?

HIE Expert Panelists• David Brailer, MD, PhD

– Santa Barbara County Care Data Exchange, Health Technology Center• William Braithwaite, MD, PhD

– Independent consultant, “Dr HIPAA”• Paul Carpenter, MD

– Associate Professor of Medicine, Endocrinology-Metabolism and Health Informatics Research, Mayo Clinic

• Daniel Friedman, PhD– Independent public health consultant

• Robert Miller, PhD– Associate Professor of Health Economics, UCSF

• Arnold Milstein, MD, MPH– Pacific Business Group on Health, Mercer Consulting, Leapfrog Group

• J Marc Overhage, MD, PhD– Regenstrief Institute, Associate Professor of Medicine, Indiana University

• Scott Young, MD– Senior Clinical Advisor, Office of Clinical Standards and Quality, CMS

• Kepa Zubeldia, MD– President and CEO, Claredi Corporation

HIE Value Construct

Providers Hospitals

Pharmacies

Radiology Centers

Other Providers

Public Health Agencies

Payers

Clinical Laboratories

HIE Value Construct

Providers Hospitals

Pharmacies

Radiology Centers

Other Providers

Public Health Agencies

Payers

Clinical Laboratories

Avoided redundant tests, Electronic test ordering and results

delivery

Avoided ADEs, drug utilization savings,

automated transaction sets

Avoided redundant imaging, Electronic imaging ordering

and results delivery

Electronic Rx, refills, interaction checking,

adherence data

Electronic submission of

reportable conditions and vital

statistics

Electronic referrals, consultation letter

delivery, chart requests

ProviderProvider

Value to Oklahoma

Providers Hospitals

Pharmacies

Radiology Centers

Other Providers

Public Health Agencies

Payers

Clinical Laboratories $99

$116

$16

$10

$39

$39

$127

$136$1.5

$1.5

$123

$141

$ Millions

ProviderProvider

Value by Stakeholder: Oklahoma

Providers Hospitals

Pharmacies

Radiology Centers

Other Providers

Public Health Agencies

Payers

Clinical Laboratories $99

$116

$16

$10

$39

$39

$127

$136$1.5

$1.5

$123

$141

$ Millions

Adverse Drug Event (ADE) Clinical ResultsPer

PhysicianOklahoma

Preventable ADEs Avoided 8.9 25,000Preventable life-threatening ADEs

Avoided0.59 1,700

Avoided ADE-related visits 5.6 16,000Avoided ADE-related hospitalizations 0.82 2,300

Net value of HIEImplementation

Years 1-10Annual, Steady-State

Starting Year 11Benefit $ 1.6 Billion $ 250 MillionCost $ 0.7 Billion* $ 42 Million*Net Value $ 0.9 Billion $ 210 Million

*Software as a service, Cloud computing, and Interoperability standards have lowered the cost of implementation and maintenance by an order of magnitude

Implementation Years 1-10

Annual, Steady-State Starting Year 11

Benefit $ 6.4 Billion $ 990 MillionCost $ 2.7 Billion* $ 160 Million*Net Value $ 3.7 Billion $ 830 Million

Implementation Years 1-10

Annual, Steady-State Starting Year 11

Benefit $ 2.0 Billion $ 310 MillionCost $ 1.1 Billion* $ 71 Million*Net Value $ 0.9 Billion $ 240 Million

Tulsa:

Oklahoma City:

Oklahoma:

But wait, there’s more . . .• CMS and Medicaid Incentive payments for

“Meaningful use of an EHR”:– $44,000 to Medicare providers, $63,000 to Medicaid– Formula-driven bonus to hospitals: $2-11M per hospital

• What does this mean to OK?– Assume 9,000 MD’s, DO’s, PA’s, NP’s are eligible– Assume the following hospital bed distribution:

  Facility Admissions BedsLess Than 50 = 80 51,060 2,074From 50-199 = 51 146,885 4,595

From 200-399 = 9 223,154 2,555400 or more = 6 157,088 3,250

146 STATE TOTALS 578,187 12,474

CMS wants EMR and HIE adoption . . .

*Assume N=9,000 MDs, DOs, PAs, and NPs focused 30% of the time on Medicare patients, and 12,474 hospital beds

National: Meaningful Use guidance

• In order to qualify for bonus payments (and avoid penalties)– By 2011, the following must be exchanged:• Doctors: Problem lists, medication lists, allergies, test

results• Hospitals: Discharge summaries, procedures, problem

lists, medication lists, allergies, and test results– By 2013, the following must be exchanged:• Doctors: Share all care transition data across the

community electronically• Hospitals: Share all care transition data electronically

HIE Progress to date• Early summer: Small working group met and produced a document:

– Outlined 14 “Items for consideration”• July 30th: Major stakeholder’s meeting. ~35 people

– Reduced “Items for consideration” from 14 to only 3:• Meet requirements established by Federal legislation for funding• Establish planning process, including HIT Policy Committee• Identify the State Designated Entity

– Agreed that OHCA could be the temporary custodial State Designated Entity until the planning process is complete or October 16, whichever comes first.

• August 14: OKHITECH Summit held, wide invitation list, comments and feedback sought

• August 14-21: Online comment period• August 20: State HIE Cooperative Agreement Program (SHIECAP) Released

State HIE Cooperative Agreement Program (SHIECAP)

• Governor must identify State Designated Entity• Each applicant must have a State Coordinator for

Healthcare IT• Focus: State Strategic Plan and Operational Plan• States without plans can spend as much as 6

months on a planning process• Applicants who fail to submit acceptable plans

will be subsumed into other nearby states

State HIE Cooperative Agreement Program (SHIECAP)

• Approval: Merit-driven• Funding: (mostly) Formula-driven– $4M base for 50 successful applicants– Additional funding up to $36M per applicant apportioned

thusly:• applicant region‘s population (5%), • number of PCPs (40%), • Acute Care Hospitals (30%), and • Medically Underserved and Rural Providers (25%). • A final 10% of the total funds will be apportioned based on an

assessment of the relative HIT need of the region, as determined by evaluation of the Letter of Intent.

– Oklahoma’s likely take: $6-8M

Deadlines and current status

• September 11: Letter of Intent Due– State Designated Entity- Done, at least temporarily– Review of existing capabilities statewide– Report of total expenditures to date in 5 key areas

• October 16: Final application due– Details of planning process– Key individuals identified to execute the process

• December 15: Award announcements• January 15: Work begins

Thanks!

David-Kendrick@ouhsc.edu