I’ve written previously about Healthcare Information Exchange Sustainability and the need for Healthcare Information Services Providers (HISPs) to serve as gateways connecting individual EHRs.

How should HISPs be funded and how can we encourage HISP vendors to connect every little guy in the country?

We’ve started to think about this in Massachusetts.

There are numerous vendors promising HISP services –  Medicity (Aenta), Axolotl (Ingenix), Surescripts, Verizon, and Covisint.

An HIE needs to include at least one common approach to data transport, a routing directory, and a certificate management process that creates a trust fabric.   Existing HISP vendors have heterogeneous approaches to each of these functions.    In the future, the Direct Project may provide a single approach, but for now HISP vendors will need to be motivated to adhere to State HIE requirements.

An idea that has been embraced by some State HIEs, such as New Hampshire, is to pay HISP vendors a modest fee (under 100K) to support State requirements.   This “connectivity” incentive results in interoperable HISPs, creating a statewide network of networks.

Once a standardized HISP approach is supported by multiple vendors, then individual practices need to be connected.   Some practices will be aggregated into hubs by EHR software vendors as has been done in cities such as North Adams (Massachusetts), projects such as the New York City PCIP project, and physicians organizations such as the Beth Israel Deaconess Physicians Organization.   However, it’s not likely to be cost effective for a vendor to connect every isolated practice to a HISP for the $50/month the practice is willing to pay.

The Regional Extension Center program offers $5000 per provider to accelerate EHR adoption.    If State HIE programs were to offer a onetime EHR integration payment to HISP vendors, such as $500 per practice connected, then it is likely vendors would accelerate their efforts to connect “the last mile”.

Thus, if State HIE funds covered vendor costs to implement statewide standards and offered a per EHR initial connectivity fee, barriers to startup would be eliminated.   The small amounts clinicians are willing to pay per month would then cover operating expenses so that HISPs could be self sustaining.

As a fallback, in the case that vendors do not find these payments appealing enough, Massachusetts has considered the idea of a public interest HISP – a subsidized service to cover practices without resources, in remote locations, or with special connectivity challenges.

Ideally, market forces would be enough for vendors to connect every payer, provider, and patient in the country.  However, HIEs will only be sustainable when there are sufficient customer connections to create business value.   A catalyst of State HIE funding to accelerate HISP standardization and EHR connectivity is necessary to provide the “activation energy” which will align the cost of providing the service with a price customers are willing to pay.

John Halamka is the CIO at Beth Israel Deconess Medical Center and the author of the popular Life as a Healthcare CIO blog, where he writes about technology, the business of healthcare and the issues he faces as the leader of the IT department of a major hospital system. He is a frequent contributor to THCB.

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8 Responses for “A Healthcare Information Services Provider Business Model”

  1. Again we see the HIT/HIE development process paralleling that of the Internet in the 80s and 90s: the HISPs parallel AOL and Prodigy (Ref. Kibbe’s prior blogs here), and NHIN direct parallel to the greater Internet. In circa 2017 the ‘commons’ of the healthcare internet will emerge, likely negating the original value of regional HIEs. My question for the author and readers: what is the value proposition for regional HIEs now forming, when docs and hospitals (especially those doing business in more than one HIE territory) can skip the middle man and contract with an HISP, such as Medicity or Surescripts (in the case of Surescripts, nearly everyone is already connected via eRx portals)? Surescripts’ national coverage at present implies an NPI and EMPI at the national level; why reinvent the wheel hundreds of times over with little community HIE start-ups?

  2. Steve Jones says:

    With all due respect to the author, and this idea. We just saw a massive reform that had zero in the way of a single connectivity idea – i.e. no standard. While this would allow strong integration across geographies and the “last mile” as prescribed, I think we can be assured that likelihood of it happening is about .01 percent. This argument (concept) has been around for decades.
    Every vendor has promised integration for decades. I especially love these “Connectathons”, which are so useless. In the end, it always comes with an asterisk mark – if/when it ever does.

  3. The strategy of needing local HIEs (however they might survive as businesses going forward) is based on the notion that “every little guy” outside of large institutions will have an EHR that is locally installed and isolated. This has not been our experience. What we have seen is that small practices, especially primary care practices, have been adopting web-based EHR products, relieving them of the IT burden of needing to host something in-house. And a large web platform (already connecting over 60,000 users and 6,000,000 patients) spans all 50 states, and is already connected with HISP infrastructures – Surescripts, for example, for eRx (and who knows what additional kinds of data transport types in the near future?). For web EHRs, local HIEs represent a one-off special build-out burden, and direct connectivity to national HISPs makes much more sense.

  4. Bill says:

    The connectivity pipeline is a public utility, and there is no value whatsoever to building multiple pipelines. This is an instance where the best approach is for the government(federal) to fund the connectivity standards and then mandate all EHR’s to support these by a mandatory compliance date.

  5. If you have minor medical expenses, or are in a position to put aside a little each month (and we really do mean a little), then it might serve you to find an HAS policy.
    TX health insurance

  6. The above posts duly noted; but I still think the community HIE can have a value proposition in two general realms: one, for uniquely local commodities (disaster/ hurricane / chemical spill preparation and response); two, for privacy and security concerns (skepticism by patients and providers in giving a national entity wholesale access to patient records, but perhaps more willing to trust more of the PHI data to locally-governed entities). I predict that very soon, there will be highly-publicized (and politicized) lapses in patient data security due to expansion of HIEs, causing a backlash against the national HIE movement – even that overseen by state or federal entities. Similarly, insurers’ purchase of HIEs will generate skepticism as well, and may hit the ball back into the community HIE court. I personally feel, for those reasons and others, that the safest bet for a physician or a patient is to invest in their community HIE – regardless of any larger HIEs in which they may participate additionally; but I must admit, I’m biased as a board member of a community HIE.

  7. Samuel Stenes, MD says:

    Are you part of the paid group of “thought leaders of America”, defrauding taxpayers by promoting the sale of meaningfully useless (for clinical care) HIT devices?
    Keep track of the deaths in this experiment.

  8. MG says:

    “If State HIE programs were to offer a onetime EHR integration payment to HISP vendors, such as $500 per practice connected, then it is likely vendors would accelerate their efforts to connect “the last mile”.”
    State HIEs are already scaling back their commitments and intentions across the board. I wish they were flush with cash so that something like this could be adopted but it is simply not a fiscal reality anytime in the near future.
    I also wonder how they could get connected for just a one-time fee of $500. Other interface fees charged by vendors for EHRs whether for Labs/Radiology/etc are typically at least 3x-4x this amount suggested and more.

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