February 2, 2006

Are RHIO's for Real?

Providers in many regions are using information technology to cooperate like never before. But there's no guarantee their work will succeed.

By Joseph Goedert, News Editor
A year ago, federal officials estimated there were about 100 regional health information organizations across the nation, in various stages of development. That number has more than doubled, according to recent surveys by the University of Maryland and the Department of Health and Human Services.

RHIOs are considered the precursors to a national health information network, a project being spearheaded by the federal government. But many are in the earliest stages of formation and most face significant barriers to widespread use.

The biggest obstacle a year ago-money-remains the biggest today. However, there are other daunting obstacles. For example, RHIOs are being rolled out even though most hospitals and physician practices have not adopted electronic medical records systems, which are prerequisites to electronically sharing patient data within a community or region.

And yet another wrench in the works is that the core functions of RHIOs could significantly change in just a couple of years, believes David Brailer, M.D., the national coordinator for health information technology at the Department of Health and Human Services.
In fact, Brailer wonders if RHIOs need business models and sustainable sources of funding, because a national network architecture may negate the need for RHIOs to perform network functions. RHIOs could see their role reduced to acting as governing or advisory bodies to determine data-sharing policies on a regional or statewide level, he says. (See story, page 46).

Sound familiar?
The premise of regional health information networks rests on disparate health care stakeholders-hospitals, group practices, payers, employers and public health agencies-cooperating to build an I.T. infrastructure to support the local sharing of data from proprietary information systems.
These stakeholders often are direct competitors, or as in the case of providers and payers, have a history of rocky relationships.

If the RHIO concept sounds familiar, it's because the general concept echoes that of community health information networks, which briefly created an industry buzz a decade ago.

Some RHIO advocates shy away from using the acronym because of its association with CHIN. A regional effort in San Diego, for instance, is dubbed the San Diego Medical Information Network Exchange.

"The minute we use the term 'RHIO,' people think of failed efforts, pie-in-the-sky plans, high expenses, and privacy and security concerns," says Stephen Carson, M.D., a pediatrician and chief medical officer for the San Diego County Medical Society Foundation, which is leading the development of the exchange.

However, RHIOs have two major advantages-the focus on safety and the rise of the Internet-over their CHIN predecessors that raise their odds for success, proponents say.

Patient safety has become a high-profile priority due in part to Institute of Medicine reports that exposed serious patient safety problems and highlighted the role that information technology and data sharing can play in improving the quality of care.

The reason President Bush in 2004 made adoption of electronic medical records a national priority was patient safety, Brailer notes.
The need to improve safety comes at a time when the escalating cost of health care is hammering U.S. businesses, which, as a result, are becoming uncompetitive, says Michael Cowan, M.D., chief medical officer of BearingPoint Inc., a McLean, Va.-based consulting firm.
That's creating an opportunity for RHIOs to help the industry increase safety by raising quality. "Medicine is under the gun from the view of quality and from the view of cost," Cowan adds. "What we saw from the Bush administration in 2004 was the president taking our industry to the woodshed."

The other fundamental advantage of RHIOs compared with CHINs is the maturation of the Internet into a reliable, affordable and widely accepted information infrastructure.

"If CHINs had the Internet and a critical mass of people who didn't run from information technology, their chances of success would have been much greater," Cowan says.

The Internet is used daily for personal and professional tasks by much of society, making physicians and others far less afraid of information technology.

"Providers were not ready for technology 10 years ago like they are today, and the change is primarily because of growth of the Internet," says Gregg Martin, CIO at Arnot Ogden Medical Center in Elmira, N.Y. The hospital is leading a fledgling RHIO initiative called the Southern Tier Electronic Medical Record Project.

The Internet has created enough of a cultural change that physicians today will accept RHIOs, says C. Kerry Stratford, M.D., a partner in St. George (Utah) Clinic, an eight-member family practice. He's also vice-chair of the Utah Health Information Network, one of a handful of surviving CHINs. The network now is trying to evolve into a RHIO. (See story, page 46)

"There's a lot of differences between now and 10 years ago," Stratford explains. "I'm sitting on a couch using a Tablet PC to send prescriptions to pharmacies. Having the Internet gives us information anytime and anywhere and we use it in daily life."

Thanks to these cultural and technological advantages, RHIOs are for real and, unlike CHINs, will have staying power, contends Wayne Owens, vice president of health care integration platforms at Sun Microsystems Inc. The Santa Clara, Calif.-based vendor is marketing its integration and networking services to the regional efforts.

"The momentum out there is unprecedented," Owens adds. "This is going to continue-it's not a false start."

Depth of acceptance
Still, RHIOs won't work unless a critical mass of physicians adopt electronic medical records in their practices. While some believe widespread adoption is inevitable, others aren't so sure.

"In general, physicians have known for some time that they'll have to go to electronic records," says Stratford, who automated his practice two years ago. "The question is if they go willingly or put it off as long as possible. There is not a universal feeling among physicians that electronic records are a Holy Grail that will solve all of their problems. A lot of fear remains that electronic records will make the practice of medicine harder."

Many physicians still do not believe there is a business case for electronic medical records, adds Martin at Arnot Ogden. "They think their practice is efficient and the technology won't provide a return on investment. Many physicians grapple with concerns that they don't have the people and money to maintain the systems."

Further, many physicians in the New York region where Arnot Ogden is trying to develop a RHIO are not yet sold on the concept of interoperable health data exchange. In addition, they don't feel other industry stakeholders are committed to helping them automate.

"Physicians are independent business people being asked to pay for I.T. out of their pocket when benefits clearly accrue to insurers and patients that don't yet have skin in the game," Martin contends.

But once physicians implement electronic records and buy into the RHIO concept, they no longer are passive about data sharing, says Kevin Carr, M.D., an internist and program director at the Waterbury (Conn.) Health Access Program, which serves uninsured and underinsured residents. The program is leading formation of a RHIO in the Waterbury area.

Once physicians understand how a RHIO can improve their access to information, "they want everything," Carr explains. "I want to be able to see even the physical therapy and nursing home progress notes."

What RHIOs want
In early 2005, Brailer, the national coordinator for health information technology, pledged that President Bush's commitment to health I.T. would become clear over the course of the year.

The administration indeed took a number of significant steps in the past year, including:
* Requesting and receiving additional funding for Brailer's office;
* Continuing to issue seed money grants for RHIOs;
* Awarding contracts to deploy network prototypes and grants to accelerate development of data standards and I.T. certification programs;
* Setting up programs to assist physicians in adopting I.T.;
* Issuing electronic prescribing rules for the Medicare Part D program;
* Publishing 512 responses to a request for information about what a national health network should look like, and;
* Issuing proposed rules to ease regulatory barriers that prevent hospitals and others from helping physicians adopt I.T.

RHIO advocates applaud the moves, but express some concerns, particularly about some details. Specifically, the proposed rules to amend physician referral restrictions under the Stark Act and the efforts to ease some provisions in anti-kickback laws that allow hospitals to help physicians automate.

Some experts considered the proposed rules to be tepid, confusing and unclear on whether any proposed provisions extended beyond the Medicare program.

"The rules were so nebulous," says Martin at Arnot Ogden Medical Center. "There will be people taking early risks until this is tested in court."

Further, many provisions of the proposed rules would not go into effect until a program to certify ambulatory electronic records systems as meeting certain functionality requirements had begun.

As written, the rules provide no help to providers, contends the National Alliance for Health Information Technology in a comment letter to the Department of Health and Human Services. "The proposed exceptions create more uncertainty about what is permitted without eliminating barriers to investment in health care I.T.," states the comment letter from the industry advocacy group.

But Brailer defends the proposed rules and says the lack of specificity was intentional.

"They are very much proposed concepts written in a way to draw input." It's important, he adds, that final rules have "clean" exemptions to physician referral and anti-kickback laws that are easy for all to understand.

He also offers no apologies that some provisions will be delayed until certification criteria for ambulatory electronic medical records are set, probably in early summer. "Certain features save lives and we don't want to rush and put patients at risk," he adds. "Certification is objective. Its features are safety, security and portability. Electronic records systems should meet these features."

Final exemption rules, Brailer adds, should be issued during the second half of this year.

Show me the money
Despite all the progress in 2005, most RHIOs ended the year unsure of how, when or if government, insurers and employers will help fund their programs and facilitate physician adoption of clinical information systems.

The Center for Health Transformation advocates the federal government annually dedicate 1% of discretionary spending-about $7 billion-to health I.T. The center, a think tank headed by former House Speaker Newt Gingrich, believes that the threat of terrorism makes a national health I.T. network a national security priority. "It's almost a no-brainer that the federal government should be the lead in this," contends David Merrill, project director at the center.

The Senate took significant action in late 2005 by passing legislation to facilitate development of RHIOs and a national network. Among other provisions, the bill authorizes $280 million in financial assistance over two years to providers and RHIOs, and codifies, or authorizes in law, the Office of the National Coordinator for Health Information Technology.

But the bill does not provide the significant funds that some in the Senate wanted, and now it must get through the more conservative House.

Some RHIOs and the providers they serve don't expect huge grants from the government-or anyone else for that matter. But they want reimbursement policies from public and private insurers that reward providers that use electronic medical records.

Many physicians are suspicious of the true motives of pay-for-performance programs, some of which reward physicians who automate.

There are concerns, for instance, that many payers won't reimburse at a higher rate for physicians who use electronic records and electronically collect data to demonstrate better care, but instead will reduce payments to those who don't automate.

"There's a lot of skepticism it will be a way for payers to cut costs instead of pay for performance," says Stratford of St. George Clinic in Utah. "If the programs truly are tied to extra reimbursement for doing better medicine, then doctors will get on board."

Further, physicians want tax breaks for adoption of electronic medical records, says Carlotta Gabard, vice president of administrative services at Integrated Health Associates, a large group practice in Ann Arbor, Mich. The practice is leading formation of a RHIO.

Money remains the biggest barrier to getting physicians to adopt clinical systems and share data, Gabard adds. "It will be difficult sharing data until we have a critical mass of physicians using electronic records."

Legislation introduced in the House in December would provide tax incentives to physicians who implement electronic medical records systems. H.R. 4641 which was referred to the Ways and Means Committee, would amend Section 179 of the Internal Revenue Code, which covers tax credits for small businesses.

Tee Green, president at physician software vendor Greenway Medical Technologies Inc., Carrollton, Ga., has long advocated such legislation as a simple way to get I.T. funding assistance through Congress.

"When you talk about Section 179 in Congress, everyone understands it," he says. "You don't have to educate everyone."

If providers want Congress to tackle health I.T. funding issues through Medicare reimbursement policies, tax breaks or other means, they better move fast, Brailer warns.

"These are political decisions that providers will have to work out with Congress," he says. "They need to do so before the presidential election heats up and the window of opportunity closes. We want to see progressive policies and reimbursement for quality. But Congress will have to decide."

Same goal, different strategies
RHIOs share the common goal of being a conduit to enable health care stakeholders to exchange data. But the RHIOs under construction are using a number of different blueprints.

By the end of 2006 or 2007, many of these efforts are expected to have a business plan and sustainable funding model that other RHIOs can adopt as a blueprint. Following is a look at some of the RHIOs being formed and the different strategies they're using.

Looking for proof
The Southern Tier Electronic Medical Record Project in Elmira, N.Y., is still in the proof-of-concept stage, but getting it working on a small scale is a priority for the next year.

"We need to get this up and running, document benefits, and share them with the local independent physician association," says Martin, the CIO at Arnot Ogden Medical Center.

The hospital-which has implemented inpatient and ambulatory electronic medical records from Raleigh, N.C.-based Misys Healthcare Systems-is preparing to share data with 80 affiliated and independent physicians at five sites using the vendor's Misys Connect integration tool.

Arnot Ogden has committed to maintaining funding for the integration tool as a community service, but physicians will be responsible for funding their records systems.

Data to be shared includes patient demographics, dates of visits, advanced directives, problem lists, medications, immunizations, allergies, vital signs and physician notes.

Two of the five initial physician sites, however, will participate only if they get grant money to help offset the cost of adopting electronic records, Martin adds.

Building, then selling
Chief Medical Officer Stephen Carson, M.D., disagrees when asked if the San Diego County Medical Society Foundation is selling a regional health information organization before finding any buyers.

But after forming a steering committee of stakeholders to map out the project, called the San Diego Medical Information Network Exchange, the society put up the $80,000 in initial funds for integration and networking technology from Sun Microsystems.

The society believes regional stakeholders are interested, but it didn't have ironclad assurances that any would participate when it made the technology down payment. However, Carson, a pediatrician, believes the business plan will be compelling enough that hospitals and clinics will quickly grasp the benefits.

The society estimates building the network will cost about $1.2 million during the next year, and can be maintained for less than $1 million a year.

The San Diego networks' initial business plan focuses on bringing quick benefits to hospitals. The county has more than 70 federally qualified health clinics serving about 500,000 uninsured and underinsured residents. Uncompensated emergency department care for that population is estimated to cost hospitals in the county more than $20 million a year.

"So, we told the hospitals we want to find a medical 'home' for these people," Carson explains. "If we can find a medical home for 10% of those who go to the emergency department for primary care, those savings are more than enough to sustain a network."

That's because one-third of uncompensated emergency care is given to patients eligible for some type of public health insurance program. The goal of the medical home project-which will be an early service of the San Diego RHIO-is to steer patients toward a primary care provider and get insurance for those who are eligible.

Under the project, a patient with no primary care physician that enters an emergency department will sign a release that will include permission to forward their medical records to federally qualified health centers and other safety net providers. The RHIO will then send an electronic message to the clinics where the patient wishes to receive primary care.

If a patient accepted by a clinic is eligible for insurance, staff will help them get enrolled. Getting patients a medical "home" for primary care will decrease emergency department visits and many patients now will have insurance, increasing revenue for the clinics and hospitals, Carson says.

For more than two years, the medical society talked with hospitals and physicians to determine other high-return benefits that would encourage participation in a RHIO.

In addition to the medical home project, the network expects early on to offer discharge summaries and emergency department transcribed notes to physicians.

The society hopes to get enough grant funding to substantially build the network. A $300,000 grant from California Blue Shield, for instance, is launching the medical home project. The network also has received some funding from WellPoint Health Networks, an Indianapolis-based managed care company.

But the RHIO's business model calls for network participants to fund the initiative on an ongoing basis. Those costs are not yet determined, but Carson has some suggestions.

He envisions the 7,000 physicians in San Diego County collectively paying 10% of the costs, hospitals paying 30% to 40%-about $100 per bed annually-and insurers paying the rest.

For hospitals, the cost would be a no-brainer, Carson believes. "It's a minuscule part of their budgets-minuscule compared with the cost of staff tracking down lab results and faxing them to physician offices."
While payers in large measure have not yet supported RHIOs, Carson doesn't blame them for waiting on the sidelines. "If I were a health plan today, I wouldn't give them money because I don't think any RHIO has yet shown that it will work."

But after the medical home project launches in March, San Diego proponents will seek payer support.

America's Health Insurance Plans, the national association for payers, declines to discuss what insurers want to see before they will aggressively support clinical I.T. automation initiatives.

The San Diego effort has received assistance from CALRHIO, an organization formed in 2005 by industry stakeholders to assist RHIO builders across the state.

The organization-a think tank of industry experts-initially struggled to find its appropriate role, but now it offers a valuable service, Carson says. "CALRHIO helped us put together bylaws and paid for development of a model governance structure," he adds. "We also bounce ideas off them."

Starting small, thinking big
An effort to build a statewide RHIO in Nebraska is intentionally starting with a limited number of stakeholders. The plan is to wait to invite others until there is something to show them.

"We have the key players we need to be in place to get this going," says Molly Nance, senior director of communication and education at the Nebraska Hospital Association in Lincoln. "Once we have the network in place, it will be its own magnet and attract the people and organizations that need to be involved."

Initial participants include virtually all urban hospitals, Blue Cross Blue Shield of Nebraska-which gave initial funding, and the Kohll's and Walgreens pharmacy chains.

The state's 65 rural hospitals, other insurers and most of the physician community are not yet part of the effort, called the Nebraska Health Information Initiative.

While the goal of the RHIO is to be statewide, proponents also will consider other options, such as smaller networks linked together, Nance says. But Nebraska has characteristics that could make a statewide network feasible.

For instance, an existing telemedicine network is being studied to see if it could form the foundation for the expanded network. And with only 2.7 million residents across 77,000 square miles, a statewide RHIO may be the only way to achieve the critical mass needed for success.
Further, health associations in the state have worked well together for many years, Nance adds. "I think Nebraska is unique in our collaborative tradition."

With the RHIO still in the planning stages and funding undetermined, proponents don't expect to have operational functions until 2007.

Physicians lead the way
In Ann Arbor, Mich., a large physician group practice has teamed with three other practices to launch the Ann Arbor Clinical Data Consortium.

Participants range in size from a 14-member gastroenterology practice to Integrated Health Associates, with 102 primary care physicians at 24 sites. More than 200 physicians work at the four group practices.
All four practices use electronic medical records software from NextGen Healthcare Information Systems, Horsham, Pa. While the practices house their software on separate databases, starting a network effort with the same vendor product will ease data sharing, says Gabard, the vice president at Integrated Health Associations and project director at the consortium. "We purposely started with the four practices because we thought we could get something done and we have," Gabard says.

A data sharing portal went live in late June and by early December was populated with information about 200,000 of the 350,000 patients the practices serve. Data the practices agreed to initially share includes demographics, pharmacy and emergency contacts, medications, allergies, and most recent diagnosis.

This spring, the consortium is inviting other physician practices to join and expects to establish electronic links with St. Joseph Mercy Hospital in Ann Arbor to access the facility's laboratory and radiology reports and discharge summaries.

Further, participants are talking with the giant University of Michigan Health System and hope to establish initial connectivity by mid-year.
For now, participants don't consider the consortium to be a regional health information organization, although that is the goal, Gabard says. "I will consider it a RHIO when we have more participants using the portal to view patient information," she explains. "But I don't know how much 'more' is. It could be when we have the University of Michigan or when we have half of the doctors in the region."
And that region could expand. The consortium is talking with physicians 30 miles away in Jackson and with a large group practice at the Detroit Medical Center.

For now, NextGen is hosting the Web portal and database and the consortium's cost has totaled six figures. The consortium is seeking grants from federal agencies and other sources, including the state government. However, "I'm not sure with the state's economy that it's feasible," Gabard acknowledges.

She also notes that health insurers have expressed interest in supporting the fledgling RHIO, "but haven't coughed up any money yet."
The consortium is considering a subscription-based model for sustainable funding. "We're talking way under $100 per physician per month," Gabard says. "We're not trying to make money with this, we're trying to cover costs."

Early assistance
Like the Ann Arbor initiative, a fledgling RHIO in Waterbury, Conn., is starting with a handful of physicians using the same electronic records software.

The Waterbury Health Access Program, which services 20,000 uninsured residents and 20,000 Medicaid beneficiaries in the region, is leading the effort.

So far, two outpatient clinics with five locations are live on electronic records from Amicore Inc., Andover, Mass. Another clinic with six locations is implementing the software.

The clinics will use a data sharing tool from Long Beach, Calif.-based First Consulting Group Inc. embedded in the Amicore software. In December, one clinic already had the tool and initially was accessing laboratory reports and problem lists from two hospitals. "Our goal is to push pretty quickly to get each location up and running on the electronic records and sharing tool in 2006," says Kevin Carr, M.D., an internist and project director of the access program.

Unlike Ann Arbor, Waterbury has some significant early assistance for its RHIO-building, which it hopes will go statewide.

The project in September 2003 received a three-year, $2.4 million grant from the Health Resources Services Administration in the Department of Health and Human Services.

Further, it is part of the team of Northrop Grumman Corp., awarded one of four federal contracts to build prototypes for a national health information network. Waterbury providers and those in several other RHIOs will serve as test sites for the prototypes, such as data sharing and record locating tools.

Waterbury likely won't receive additional direct financial assistance from the Northrop Grumman team, Carr says. Consequently, it faces the same financial challenges of other RHIOs in building a sustainable funding strategy. "But developing relationships with the vendors on the team is a huge advantage," he notes. "The standards being used in this program have a higher level of probability to be the standards used nationally."

The Waterbury RHIO got on the network prototype team through First Consulting. "We have experience with federally qualified health centers and serving the uninsured and underinsured market," Carr says.

Vendor, employers take the lead
Cerner Corp. has a history of launching ambitious initiatives to prove a concept-and to see if a business opportunity exists.

The Kansas City, Mo.-based software vendor in recent years expanded the existing cable network to connect patients and providers in Winona, Minn. In 2004, the company started a 10-year program to offer a free electronic personal health record to every child in the nation who has Type 1 diabetes.

Now, Cerner is leading formation of an employer-driven RHIO in the Kansas City region. Neal Patterson, chair and CEO at Cerner, looks at the RHIO landscape and sees organizations asking employers for money without offering anything concrete in return.

"In this country, people build something of value with their own money, then sell it to others," Patterson says. "I'm confused how RHIOs get launched when people sit around and have meetings and want others to give them money. There has to first be a business model. If you're trying to raise capital to build something from scratch, that's not a business model."

Consequently, Cerner-itself a major employer in the region-went to other large local companies with a proposal that they jointly fund and build a RHIO.

Cerner committed to building and operating the information technology infrastructure for free for three years, then to charge only its costs on an ongoing basis. Much of the initial costs will be absorbed in the company's research and development budget.

Consequently, 11 other large self-funded employers joined with Cerner in late 2005 to launch the Kansas City RHIO, called Healthe. The employers are American Century Investments; Applebee's; Children's Mercy Hospitals and Clinics; DST Systems Inc.; H&R Block; J.E. Dunn; Lockton Companies; Sprint Nextel; Truman Medical Centers; UMB Financial Corp.; and Yellow Roadway.

The employers will pay a per-employee, per-month fee to get the RHIO up and running. Employees will decide whether to participate in the initiative.

Companies like Cerner and Sun Microsystems aren't the only information technology vendors that see RHIOs as a promising business opportunity.

Battling for position
Some observers believe claims clearinghouses are positioned well to enter the RHIO market.

Already the industry experts at moving claims and other payment/administrative transactions, clearinghouses could find opportunities as a clinical data conduit, says Jan Root, associate executive director at the Utah Health Information Network. The network is a surviving CHIN and now is trying to figure out how to migrate to a RHIO.

"Clearinghouses can make a good business case: 'You pay a fee, I move your transactions,'" Root adds. "Don't underestimate the potential for clearinghouses to get in the RHIO business."

But for smaller vendors, getting a piece of the RHIO pie can be challenging.

In June 2005, seven vendors formed the CollaboraCare Consortium to jointly market their products to RHIOs. Eight more companies joined during the following quarter and the group expected early this year to announce more members.

As of mid-December, the consortium had no RHIO contracts, but had bids out on a handful of initiatives, says John Capobianco, president and COO at MEDecision Inc. The Wayne, Pa.-based vendor of software for payers led formation of the consortium.

Member vendors sell case/utilization/disease management, personal health records, drug information content, transactions processing, managed care, electronic prescription generation and connectivity, smart card, Web portal, health data exchange, and electronic medical records software.

Among other commitments, the vendors will build standardized interfaces to ease the sharing of data.

The consortium is counseling prospective RHIO clients to start small and it touts being able to offer all the I.T. tools a RHIO needs for hundreds of thousands of dollars, instead of millions.

"Pick a population subset to get good returns and then build the infrastructure for the general population," Capobianco advises.

Brailer: RHIOs will need makeovers
The federal government has pushed hard for the development of regional health information organizations. But the mission of RHIOs will change dramatically within two or three years as the government's effort to build a national network gains momentum, predicts David Brailer, M.D., the federal government's national coordinator for health information technology.

That doesn't mean RHIOs should change course now, he adds, as their work is important toward getting widespread adoption of interoperable electronic medical records. "Being a RHIO is a journey," Brailer explains. "We know it has a beginning and a middle, but we don't know what the end looks like."

The very fact that communities and regions across the nation are working on RHIOs is testament to the determination of the health care industry to reinvent itself, Brailer believes. "No one has told these communities that they have to go out and build RHIOs. There is no upfront financing incentive to do it. But folks are going out, collaborating and doing it anyway."

But health care networking technology now being developed under federal contracts could change the core functions of RHIOs.

The Department of Health and Human Services recently awarded four contracts for development of prototype national health information networks. The department expects the prototypes to be delivered this fall, then scaled up in 2007.

This means the tools to create a national network within the existing Internet infrastructure and tools to connect to the network could be available by the end of 2007.

Tough justification
And that means it will be tough for RHIOs to justify why they are developing regional or statewide networks that share data locally and link to the national network, Brailer says.

Consequently, he sees RHIOs evolving into governing or advisory bodies to decide how to share data across regional or state boundaries. "In two years, most RHIOs won't have reached a critical mass stage of acceptance and will have the option of changing their strategy."

Eventually, physicians and hospitals will buy electronic medical records software with the network connectivity tools embedded, Brailer predicts. Initially, opportunities will exist for vendors-and some RHIOs-to sell the tool kits.

"But RHIOs in the end won't be the purveyors of technology for doctors and hospitals," he adds. "RHIOs are here to stay. Some will handle the technological end but most won't have the scale to make it affordable."

For these reasons, RHIOs don't have to tackle what many have identified as their biggest challenges-developing a business model and sustainable sources of funding, Brailer says.

Most RHIOs are not-for-profit and are being built for the common good; Brailer even doubts for-profit RHIOs ever would make money. "Charging transaction fees is an exceedingly M.B.A. way of thinking," says the former health I.T. entrepreneur.

Rather than a business model and sustainable funding, the critical test for RHIOs will be a governance model that brings in all stakeholders and has procedures to resolve conflict.

"Most RHIOs will want to make local decisions on how data will be shared," Brailer explains. "In the end, the technology doesn't matter; it's who controls the data. The less centralization there is, the more value people will see because they will have more decision making ability."
The national health information network won't be physically different from the existing Internet, he envisions. But parts of the health network will be sequestered from the rest of the Internet. This means sequestered data will move on the same physical wires as other data on the Internet, but its nodes and related storage and transfer equipment will be different.

For instance, much of the nation's air traffic control system runs on the "normal" Internet, Brailer explains. But landing controls-deemed as mission-critical data-are sequestered.

Consequently, the health care industry and policymakers will have to decide what health data is mission-critical.

"Is it data monitoring devices in the body, or data to support real-time care, or data collection for research?" Brailer asks. "Some data uses will be declared critical and others will not."

Time will tell if Brailer's vision-or anyone else's-are accurate, says Neal Patterson, chair and CEO of Cerner Corp., Kansas City, Mo. Cerner, a major vendor of clinical software, is leading formation of an employer-sponsored RHIO in Kansas City.

But the United States should watch closely as England builds its national health information network, he adds. Cerner is part of a vendor team in that effort.

"We will see over the next 12 months the opportunity to compare and contrast with England," Patterson says. "There is clearly a national architecture being laid out in England and it will be easy to see if it works. This time next year, we'll know if what they are doing will work."

Experienced networks offer business model

Only a few networks that started in the days of community health information networks, or soon after, remain operational. These surviving networks provide lessons for regional health information organizations searching for a sustainable business model.
The Utah Health Information Network has operated since 1994 as a statewide, value-added network to transmit claims and related transactions among providers and payers.

Providers pay a modest membership fee plus an annual subscription fee. For physician practices, the subscription fee ranges from $100 for a solo physician to $7,500 for a practice of more than 100 physicians. Billing services pay from $100 for one licensed provider to $7,500 for more than 100 licensed providers. Small hospitals pay $450, mid-size facilities pay $2,000 and large ones pay $5,000.

The network handles HIPAA-standard administrative transactions. All of Utah's hospitals and 90% of its physicians and other non-dental providers use the network to some degree to connect to more than 400 payers. "The basic model of pricing is not-for-profit," says Jan Root, assistant executive director. "All we want is to cover expenses and have a little research fund."

The Utah Health Information Network now is in the planning stages of transforming itself into a RHIO and adding clinical transactions to its services.

Root envisions pricing for clinical transactions to be similar to the administrative functions. "But pricing is just a guess right now," she adds. "The decision hasn't been made yet how to price for clinical."
In Cincinnati, HealthBridge formed in the late 1990s after the CHIN experiment and before RHIOs were envisioned.

Serving southern Ohio and parts of Kentucky and Indiana, HealthBridge "was built on the smoldering ashes of several CHIN efforts in Cincinnati," says Robert Steffel, executive director.
Five delivery systems and two payers in 1997 formed HealthBridge. But it wasn't until 2000 that the planning and initial financing was complete and the network bought clinical messaging software from Axolotl Corp., Mountain View, Calif.

Today, physicians can access a range of data from participating hospitals through the Internet-based network. Physicians can access a Web portal to get test results, sign charts, view medical images, view medical records at some hospitals, and view face sheets to know when patients were in the emergency department, admitted or discharged. A coding product is available for billers.

"The degree of access varies," Steffel explains. "Some hospitals give access to their electronic records system, others just give access to a physician's notes to sign a chart. It takes time to build trust."

HealthBridge started with $250,000 loans from each of the founding five delivery systems and two payers. It has repaid the insurers-Humana Inc. and the Anthem division of WellPoint Inc.-and the other loans have been extended to 2015.

That gave HealthBridge its seed money. Its sustainable funds come from the delivery systems and others outsourcing their content delivery-such as test results from the hospitals.

In November 2005, HealthBridge sent 1.3 million test results from 17 hospitals to 3,989 physicians. Eighty-nine percent of results were accessed electronically through the HealthBridge portal; the company printed and mailed, faxed or e-mailed the others.

"If we charge by transactions, that motivates people not to use the service," Steffel says. "But if we charge by user, that motivates places to sign up just one person."

Physicians are not charged to use the network but are responsible for buying the computer equipment and telecommunications services to link to the portal. However, HealthBridge does offer physicians the option of buying high-speed Internet service from the network.
Other revenue comes from billing companies paying for access to certain hospital information systems to access patient demographic and insurance data, and collection of chief complaint data from 17 emergency departments for public health surveillance functions. In 2005, 74% of revenue came from hospitals and delivery systems.
HealthBridge does not yet pull data elements from provider information systems. Its challenges to becoming a RHIO include getting consensus on data elements to be shared and a new business model, Steffel says.

National network keeps debate over patient identifier alive
Can anyone imagine a social security system without a unique Social Security Number for each participant? Or a national banking ATM network without a unique personal identifier for everyone with a debit card?

If not, some experts ask, how can the United States build a national health information network without a national patient identifier?
The question is not being given enough consideration, believes David Merritt, project director at the Center for Health Transformation in Washington. Founded by former House Speaker Newt Gingrich, the center is a think tank that advocates fundamental changes in the nation's health care system, including widespread adoption of I.T.
"I don't see any way you can build a national health information system for 300 million people without a national patient identifier," he contends. "It makes no sense to play technological gymnastics to get what we all know we need-a national identifier."

Enacting such an identifier would be politically very difficult and it could never be mandated, Merritt acknowledges. But he believes most citizens would accept it.

Understanding limitations
Those who don't accept the identifier would have to understand that searches for their medical data would be very limited, says Michael Cowan, M.D., chief medical offer of BearingPoint Inc., a McLean, Va.-based consulting firm. That means a patient's physician or hospital would generally have access only to data in their own information systems.

Some software vendors say by using data mapping technology embedded with complex mathematical algorithms, it's possible to track down the right patient data when the patient is identified in different ways.

But the inability to use a national patient identifier is a sore spot, says John Capobianco, president at MEDecision Inc., a Wayne, Pa.-based utilization/disease/case management software vendor for payers.

"We have to have a national identifier," he declares. "We have one for your taxes, why can't we have one for your medications? It just would be an awful lot easier if we had one."

Neal Patterson, chair and CEO at Cerner Corp., one of the nation's largest vendors of health information technology, believes the absence of a national patient identifier is a critical flaw in the plans for a national health network. "I don't know of a formal system that doesn't have a unique number," he notes. "And there is a reason why you have to have a number-those databases need a key."

Patterson is hosting a meeting of vendors at the Healthcare Information and Management Systems Society Conference & Exhibition this month in San Diego. He hopes to organize the vendor community to push for a national patient identifier.

He'll also suggest vendors fund a study by the Rand Corp., Santa Monica, Calif., to determine if an algorithm approach is as good as any unique number, if the Social Security Number should be used, or if a separate national patient identifier is necessary.

The question of whether a national health information network can efficiently operate absent a national patient identifier is a legitimate one, says Daniel Garrett, vice president and management partner of the global health solution practice at Computer Sciences Corp., El Segundo, Calif.

The vendor is one of four prime contractors recently awarded federal contracts to build network prototypes. "We'll answer that question definitively over the next 12 to 24 months after developing and testing prototypes," Garrett adds.

Data mapping is not perfect. Some RHIO advocates privately fear a national patient identifier won't become a reality until reports surface of patients dying because physicians accessed the wrong data, or a catastrophe such as a huge biological attack spurs politicians to enact a unique identifier.