Sustainability threatens HIEs even as their numbers increase

Finding a durable business model to keep afloat financially is one of the biggest challenges facing health information exchanges as the federal and state grants that funded their start up and early development expire.

“We haven’t figured out what makes an organization sustainable,” said Jennifer Covich Bordenick, the chief executive of the eHealth Initiative, a non-profit organization which promotes health IT. “There is no set business model.”

Covish Bordenick made her remarks at a July 22 conference held to announce the results of the group’s annual survey on the growth of HIEs around the country.

Many of those HIEs that are financially independent make their money through subscription fees, membership dues and transaction fees from hospitals, physician practices, health plans and labs, the survey found

However, there was significant growth in HIE initiatives, much of it the result of the creation of state-designated entities funded by the Office of the National Coordinator for Health IT, which are tasked to develop statewide exchanges.

The number of health information exchanges that are operational and transmitting data has expanded to 73 in 2010, a 28 percent increase from the 57 reported in last year’s survey. It also identified 234 active health information exchange (HIE) initiatives compared with 193 last year.

“This is a big advancement over the last 12 months of sites where exchange is happening,” Covich Bordenick said.

Of the operational HIEs, 18 reported that they were self-sustaining, meaning they did not rely on federal funding and were breaking even financially solely through operational revenue, she said. 

Responses came from 199 of the 234 known health information organizations. Of those, 107 initiatives said they were not dependent on federal funding, up from 71 last year.

The survey respondents included 48 of the 56 state-designated entities. More than half of the state entities were currently involved in building a technical infrastructure for health information exchange.   

The exchange of health information is critical for physicians and hospitals to demonstrate meaningful use of electronic health records (EHRs), which they have to do in order to qualify for incentive payments under the HITECH Act.

“In terms of stage 1 of meaningful use, there’s a significant jump in exchange and e-prescribing, but it’s still not enough,” Covich Bordenick said. “More initiatives and providers need to document cost savings, and promote services that involve patients in their healthcare.”

The top services that HIEs provide are connectivity to EHRs, test results delivery and health summaries for continuity of care, according to the survey. The leading services that the state entities offer are electronic prescribing and refill requests, prescription fill status and history, and electronic eligibility and claims transactions.