1. Sustainable Funding Models for RHIOs
Get Connected Knowledge Forum
June 28, 2005
manatt
manatt | phelps | phillips
William S. Bernstein, Esq.
(212)

2. 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

3. 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

4. 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

5. 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

6. RHIOs: Emerging Business Plans
Regional Health Information Organization
RHIOs are regional entities which support the development,
implementation and application of secure
health information exchange
Financing
Regulatory
Decisions
Information
Technology
Clinical
Process
Improvement
Incentives
Public
Relations
Consumer
Participation
Privacy and security standards
Operating standards
Core data set
Clinical protocols
Data use rules
Capital
Development
Operations
Security
Training
Support
NHIN Compliance
Clinical Guidelines
Operations
Implement
Training
Support
Performance goals
Incentive structure
Coordination of payers and employers
Marketing Strategy
Communication Plan
Website management
Media management
Performance publication
Patient advocacy
Patient involvement strategies
Potential Outsource
Partners exist
Source: HealthAlliant

7. RHIOs: Emerging Business Plans
CareSpark (Tennessee)
Indiana
Massachusetts

8. 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
In our region, we are ahead of most in our willingness to collaborate. The coalition which was formed at KAHIP (Kingsport Area Health Improvement Project) in 1991 resulted in several successful health improvement projects, including Friends in Need Health Center and a project to improve drivers education and highway safety. In 1999, the group reflected its move to a more regional perspective by changing to become the Community Health Improvement Partnership, then the Central Appalachian Health Improvement Partnership. The effort to establish a process for exchanging health information began in December 2002, when the group realized that a quality improvement process for chronic disease management required good data for our region. After a demonstration of the system in use with the V.A., the group discovered a similar effort in Santa Barbara California, and resolved to pursue planning for a health information exchange for our region.

9. 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
Labs
Results delivery
Data repository
Network applications
Surveillance
Reportable conditions
Results delivery
Outpatient RX
Public
health
Payer
Secure document transfer
Payer
Physician office
De-identified, longitudinal clinical data
Ambulatory centers
Public health
Researchers
Source: IHIE

10. Massachusetts: Pilot Project in 3 Communities
Management & coordination
Joint oversight and decision-making bodies
Structure, composition, process
ICCC
PSC
Evaluation/ transformation
Quality
Cost
Productivity
Etc.
Quality measurement
Pilot evaluation
Transformation models
Intra-community connectivity
Connectivity
Clinical access to data
Data gathering and aggregation
Communication
Clinical IT implementation/ support
Hardware/software
Implementation/tech support
Systems integration
Workflow redesign
Decision support
Source: MAeHC

11. 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

12. 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 organization’s 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

13. RHIOs: Financing, Formation and Governance
Medical Knowledge
100%
Treatment
50% of Cost
20% of Return
Diagnostic
3 applications
4 ways to eliminate waste
Broad-based Decision Support Tools
EHR + CDS provide Patient Data
Like many things in life, it is the foundation
And allows creation of patient access, portability, telemedicine
And allows creation of public health surveillance, clinical research
Redundancy
Patient Data
Errors
EMR
HIE
CDS
Source: SBCCDE, CITL, Gordian Project analysis

14. RHIOs: Financing, Formation and Governance
Private Payers
Medicare
Medicaid
Self-insured
Self-pay
Physicians
Substantial savings arise from cost avoidance
Formulary compliance/generic substitution
Radiology
Laboratory
ADE
Ambulatory Computer-based Physician Order Entry
Source: Center for Information Technology Leadership, 2003

15. RHIOs: Financing, Formation and Governance
Purchasers
Physicians
Enrollment Fee
CareSpark
Gain Sharing
Technology
Purchaser Savings
Source: HealthAlliant

16. 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.

17. RHIOs: Financing, Formation and Governance
Virtual Model
Non-Profit Corporation Model
For-Profit Corporation Model
Limited Liability Company Model

18. 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

19. 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.