Sustainable Funding Models for RHIOs

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Sustainable Funding Models for RHIOs
Get Connected Knowledge Forum June 28, 2005
manatt manatt phelps phillips
William S. Bernstein, Esq. wbernstein_at_manatt.com (
212) 830-7282
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Table of Contents

• Realities
• RHIOs Emerging Policy Issues
• RHIOs Emerging Business Plans
• Emerging Models for Advancing HIT/HIE
• RHIOs Financing, Formation and Governance
• RHIOs Lessons From The Field

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Realities

• Framework for Strategic Action Issued but Federal
  Agenda Still Emerging
• NHIN Waiting to hear federal response to
  submissions
• RHIOs Still nascent concept with great variation
  as to mission, goals and technology plans
• If you have seen one RHIO, you have seen one
  RHIO
• Funding Sources are Scarce, Especially for Early
  Development Stage, But Some Notable Exceptions
• Big Question Whether Potential Benefits of
  HIT/HIE Can Overcome Competing Agendas and
  Priorities

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RHIOs Emerging Policy Issues

• No Federal guidelines at this point, but likely
  to emerge in the next several months field will
  evolve over time
• Federal definition of RHIOs like to focus on four
  areas
• Public Trust
• Harmonization of State/Local Privacy Issues
• Security
• Aligned Financial Incentives

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RHIOs Emerging Policy Issues

• Key issues to be defined with respect to RHIOs
• Geographic coverage
• Requirements regarding numbers of
• stakeholders/definition of community
  project
• Relationship to National Health Information
• Network (NHIN)
• Tax status of an entity
• Availability of Federal funding
• Certification/Accreditation
• Requirements in Federal Contracts
• State role in defining RHIOs

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RHIOs Emerging Business Plans
Regional Health Information Organization
RHIOs are regional entities which support the
development, implementation and application of
secure health information exchange
Information Technology
Clinical Process Improvement
Financing
Regulatory Decisions
Public Relations
Incentives
Consumer Participation

• Privacy and security standards
• Operating standards
• Core data set
• Clinical protocols
• Data use rules

• Capital

• Performance goals
• Incentive structure
• Coordination of payers and employers

• Marketing Strategy
• Communication Plan
• Website management
• Media management
• Performance publication

• Development
• Operations
• Security
• Training
• Support
• NHIN Compliance

• Clinical Guidelines
• Operations
• Implement
• Training
• Support

• Patient advocacy
• Patient involvement strategies

Potential Outsource Partners exist
Source HealthAlliant
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RHIOs Emerging Business Plans

• CareSpark (Tennessee)
• Indiana
• Massachusetts

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What Is CareSpark?

• CareSpark is a not for profit organization commit
  committed to better health in the central
  Appalachian region through collaboration,
  innovation, and wise use of health information
• 10 year history of health improvement projects
• Regional leaders concluded major improvements
  require regional health information exchange
  (HIE)
• 2 ½ years on current project 600,000 raised in
  9 months
• Filed for 501c3 not for profit status

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Regional Economic ImpactAverage of First Three
Project Years
Conservative Projections
CareSpark will help reduce unnecessary spending
through coordinated regional programs and
equitably share savings among participants and to
fund operations.
260 M
48 M
Source CareSpark
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Indiana Health Information Exchange
Data access and use
Data management

• Results delivery
• Secure document transfer
• Shared EMR
• Credentialing
• Eligibility checking

Hospitals
Payers
Hospital

• Results delivery
• Secure document transfer
• Shared EMR
• CPOE
• Credentialing
• Eligibility checking

Physicians
Health Information Exchange
Labs

• Results delivery

Labs
Data repository
Network applications

• Surveillance
• Reportable conditions
• Results delivery

Public health
Outpatient RX
Payer

• Secure document transfer

Payer
Physician office

• De-identified, longitudinal clinical data

Ambulatory centers
Public health
Researchers
Source IHIE
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Massachusetts Pilot Project in
3 Communities
Management coordination

• Joint oversight and decision-making bodies
• Structure, composition, process

Evaluation/ transformation

• Quality measurement
• Pilot evaluation
• Transformation models

• Quality
• Cost
• Productivity
• Etc.

Intra-community connectivity
Connectivity

• Clinical access to data
• Data gathering and aggregation
• Communication

• Hardware/software
• Implementation/tech support
• Systems integration
• Workflow redesign
• Decision support

Clinical IT implementation/ support
Source MAeHC
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Emerging Models for Advancing HIT/HIE

• Grassroots No Statewide, Coordinated Effort
  Driven entirely at local level truly allow a
  thousand flowers bloom
• Convener Essential Tasks Educator, Convener,
  Information Clearinghouse, Researcher
• Catalyst Essential Tasks Facilitate financing,
  provide technical assistance and project
  development support to spawn regional initiatives
• Operator Essential Tasks Create financing
  vehicle and build infrastructure for information
  exchange

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RHIOs Financing, Formation and Governance

• Reviewing legal options necessitates a
  multi-faceted process involving an analysis of
• The key business decisions that first need to be
  made in order to define the organizations
  mission and scope
• The range of options facing the organization
  relative to
• Governance Structure
• Tax Status of Legal Entity
• Terms and Conditions of Participant Agreements

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RHIOs Financing, Formation and Governance
Medical Knowledge
100
Treatment
50 of Cost 20 of Return
Diagnostic
Redundancy
Patient Data
Errors
EMR
HIE
CDS
Source SBCCDE, CITL, Gordian Project analysis
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RHIOs Financing, Formation and Governance
Private Payers Medicare Medicaid Self-insured Self
-pay
Physicians
Ambulatory Computer-based Physician Order Entry
Source Center for Information Technology
Leadership, 2003
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RHIOs Financing, Formation and Governance
Source HealthAlliant
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RHIOs Financing, Formation and Governance

• Classes of Membership -- Categories of
  interested participants (e.g., institutional
  providers, physicians and medical groups, other
  clinicians, managed care companies and insurers,
  local employers, public health agencies, public
  representatives) could be divided into classes
  and represented on the governing body by one or
  more representative members.
• Restrictive Membership -- The governing body
  could consist of a limited number of members of
  diverse backgrounds chosen because of their
  leadership skills and standing in the community,
  their ability to articulate the views of various
  constituencies yet rise above those interests in
  determining the future of the project, etc.

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RHIOs Financing, Formation and Governance

• Virtual Model
• Non-Profit Corporation Model
• For-Profit Corporation Model
• Limited Liability Company Model

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RHIOs Lessons from the Field

• Importance of Leadership and Creating Shared
  Vision Among Key Stakeholders
• Organization of Project - Needs to be
  interdisciplinary and inclusive
• Clinical
• Legal/Organization
• Financial
• Technology
• Communications
• First step is creating strategic business plan
  this will drive all future steps
• Structure of organizational vehicle may minimize
  legal complexity - multi-stakeholder
  not-for-profit structure, with independent
  decision making body, will significantly reduce
  concerns regarding fraud and abuse and antitrust

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RHIOs Lessons from the Field

• State law privacy issues may present larger
  hurdles to project than HIPAA
• Largest and most complex issues involve
• Defining role of RHIO as compared to and in
  relation to role of stakeholders contracting with
  the RHIO
• Creating financing plan for the project Think
  of financing as occurring in three stages
• Planning
• Development
• Operations
• Note RHIO may enable financing of certain
  information technology investment by outside
  entities this capital/operating cost will be
  borne by the outside entities, not the RHIO
  itself.