Choosing between public and private HIEs

Sept. 25, 2013
With an exponential rise in interoperability requirements due to regulatory reform initiatives, providers are quickly integrating with HIEs. This means that they often have to make a choice between public HIEs, set up using federal funding, and private HIEs, set up by participating stakeholders or private healthcare organizations. Both types, however, are still in a state of flux with evolving processes and revenue models.

While the decision to integrate with either a private or public HIE is driven mainly by sustainability and ROI considerations, it is imperative for providers to understand the differences. 

When it comes to size, public HIEs tend to be significantly larger. This is in part a factor of federal funding, but the number of participants in a public HIE can also be extensive due to a service area of an entire community or state. In contrast, private HIEs require buy-in from surrounding organizations, and as a result they serve only a limited faction of providers and communities. 

The heavy involvement of the provider community, along with federal backing, can make the public HIE a seemingly more sustainable model for healthcare data exchange. However, according to a KLAS report, the number of public HIEs rose from 37 to 67 from 2010 to 2011, while the number of private HIEs almost tripled, from 52 to 161, during the same period.

Technology considerations and other factors have made integration with public HIEs complicated.

Disparate systems make integration complex. Public HIEs often include participants using disparate technologies and standards with varied interpretations. Private HIEs, owing to proprietary implementations, are more likely to successfully realize benefits for both the participating healthcare organizations and the patients being served.

Getting funding when it’s needed. Federal funding is usually only available for a limited and defined period of time. The duration of funding is often arbitrarily defined with little or no regard to the business or clinical needs of an HIE. Conversely, private HIEs don’t rely on federal backing and therefore have no time-bound funding restrictions. They also have the opportunity to first define their revenue model before implementing the HIE.

Adoption is key to success. Solution designing and implementation occurs in silos, with the focus on getting the standards in place, rather than increasing end-user engagements. Solutions may often be out of sync with physician needs and expectations, greatly affecting adoption. Private HIEs have strong involvement of participants right from the start, since it’s usually providers who fund the program. This significantly reduces the risk of non-adoption by end users.

Too many things at once. Public HIEs have very large mandates and often attempt to address all of the state’s requirements for data exchange at once. They face challenges in educating patients about interoperability requirements and in maintaining the privacy and security of clinical information. As such, they find it much more difficult to obtain patient consent for data exchange.

Private HIEs attempt to address a subset of the requirements. It therefore becomes much easier to educate and explain the benefits of the exchange and obtain patient consent.

For now, private HIEs seem to have the edge over public. However, the public HIE model has more pull when it comes to compliance industry standards. Private HIEs tend to bend the rules, compromise and allow proprietary interfacing standards that can potentially jeopardize longevity and future expansion.

Also, private HIEs require upfront capital investments to be made by participants during the initial stages of development, making it difficult for rural and underserved communities to be included. In order to demonstrate value and justify ROI, private HIEs need very high levels of participation from patients, providers, hospitals and payers – without them, sustainability would be very difficult.

Should organizations decide whether to go private or public? Is there a way to get the best of both worlds? A possible solution may be a hybrid model, where the public HIE operates as an umbrella organization linking all private HIEs. But whether this becomes a commercially viable strategy is yet to be seen. As the HIE market continues to evolve and care-delivery models are aligned to quality outcomes, organizations that choose to be part of one must carefully weigh the pros and cons of joining a private, public or even a hybrid model, and then work to build a comprehensive and sustainable roadmap for effective healthcare interoperability.

About the author 

Manish Sharma is VP of provider and life sciences, CitiusTech.

For more on CitiusTech: click here

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