**Connecting for Health**

**ACHIEVING ELECTRONIC**

**CONNECTIVITY IN HEATLHCARE**

Working Group on Financial, Organizational, and Legal Sustainability of
Health Information

**Summary of Organizational and Governance**

**Recommendations**

July, 2004

Markle Foundation

10 Rockefeller Plaza

New York, NY 10020

www.connectingforhealth.org

Summary of Organizational and Governance Recommendations

Physicians and hospitals are not adopting clinical information
technology at a rapid rate due to the poor financial case, difficult
modifications of clinical workflow and decision-making processes,
perceived legal barriers to sharing information among disparate
organizations and limited capacity of health care organizations to
organize regionally: factors that make a risky implementation even
riskier. The promise of EHRs and other clinical information technology
remains, however, as studies demonstrate that they can advance the
quality and efficiency of care, resulting in reduced medical errors,
reduced utilization, improved ability to manage chronic disease,
improved longevity and health status, among other potential benefits.

Recent studies have shown that in order to provide a majority of the
benefit, clinical applications must interconnect to provide
interoperability of patient information. In order for patient
information from multiple sources to interconnect, health care
organizations must work together to share information. Health systems,
providers, payors and consumers are engaged in community-level health
information sharing projects in several states today. These health
information sharing arrangements vary in scope, formality and expected
results but represent a growing trend nationwide. While local
experiments continue to progress, the federal government is evaluating
the feasibility of developing a National Health Information
Infrastructure to enable interoperability of information. Should an
infrastructure be developed for wide-scale adoption, the question arises
as to whether the health care industry is organized appropriately and
sufficiently prepared to sustainably adopt an infrastructure and related
clinical information technology applications to share information.

From February through July 2004, within the framework of Phase II of
Connecting for Health, the **Working Group on Financial, Organizational
and Legal Sustainability of Health Information Exchange** performed an
analysis of the legal and organizational issues and barriers to health
information exchange as well as a high-level qualitative financial
analysis of health care IT application adoption. The Working Group
focused on health information exchange for the ambulatory care physician
practice. The goal of the analysis was to clarify and improve the
understanding of barriers and opportunities to achieving sustainable
adoption of health information technology and information exchange for
the purchaser/implementer of a specific type of clinical information
system application. Furthermore, we hoped to identify starting points
and near-term opportunities for physician practices and inpatient
providers to adopt health care information technology with the goal of
health information exchange subject to privacy and security protections.

The 9 members of the Working Group represented health care informatics
researchers, physicians, health system executives and legal
professionals. The Working Group also created an External Review Panel
to review their results consisting of experts on the topic from a
variety of perspectives and representatives specifically from employers,
health plans, vendors and the federal government. There is a dearth of
data and a strong experience base to draw out legal and organizational
issues resulting from health information exchange among health care
organizations. Working Group and staff conducted literature reviews,
interviewed industry experts, developed a framework and utilized the
expertise of the Working Group to develop the framework and analyses
during a series of conference calls, in-person meetings and sub-group
working sessions.

**Preliminary Recommendations**

Effectively addressing organizational and governance issues is critical
to ensuring that the technical infrastructure adoption can be sustained
to enable information sharing on a local, regional and national basis.
Information sharing would be done subject to the architecture for the
linkage of health records, discussed separately in the recommendations
of the Linking of Records Working Group of Connecting for Health. That
architecture uses a "network of networks" approach where holders of
records would control the criteria for when records would be shared.
Academic research and initial evaluation of health care information
sharing demonstration projects reveal that establishing clear vision,
organizational principles and governance structures within and across
organizations are critical steps to ensure a sustainable implementation.
Developing an information sharing infrastructure and relationships will
be challenging in even the most mature markets, thus organizations
should place a high priority on readiness assessment to determine
whether there is a reasonable prospect of regional success in achieving
comprehensive interoperability subject to privacy and security
safeguards. Further, the approach to information sharing will be
different depending upon the competitiveness of the market, the
geographical characteristics and the extent of health care IT adoption,
among other factors. There remains a lot to be learned about the most
successful ways to achieve sustainability and the most appropriate roles
and responsibilities among health care entities and government
organizations.

To encourage the government to enable organizational and governance
progress as well as the industry to move forward and begin to develop
the tools necessary to successfully sustain infrastructure and clinical
IT application adoption, we make the following four organizational and
governance recommendations as starting points:

**Findings**

1.  **Communities should assess their readiness for local and regional
    data sharing by conducting a rigorous review of the technical,
    clinical, organizational, community commitment and leadership, all
    critical success factors in building and managing a local health
    information infrastructure.**

2.  **Communities will require a source of activation to catalyze or
    enforce convening of a health information exchange infrastructure.**

3.  **Most management and legal issues faced by communities and
    individuals in establishing a health information infrastructure,
    consistent with effective security and privacy protections, can be
    addressed in the context of existing law and through use of
    contracts.**

4.  **As health information exchange implementations mature, significant
    issues that are currently poorly understood may require policy and
    regulatory changes to enable sustainable adoption.**

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1.  **Communities should assess their readiness for local and regional
    data sharing by conducting a rigorous review of the technical,
    clinical, organizational, community commitment and leadership, all
    critical success factors in building and managing a local health
    information infrastructure.**

-   To get started, regions contemplating establishment of a health
    information exchange should conduct an organizational and technical
    diagnostic of community readiness for data sharing including the
    following:

    -   **Strength of the business case** for adoption and collaboration

    -   **Ability to** **achieve community-wide participation**

    -   **Stakeholder willingness to commit** to addressing the
        financial, technical, clinical, management, organizational,
        public, and consumer needs and concerns related to establishing
        a local or regional health information infrastructure

    -   The number, complexity and **nature of market and regulatory
        barriers** to establishment of the local or regional health
        information infrastructure and form a near-term and long-term
        policy action plan from this

    -   **Willingness and ability to develop a strategic plan**
        identifying the critical mass and incremental starting points
        necessary for proof of concept

-   Communities developing health information exchanges must address
    critical success factors including the following:

    -   ***Leadership*:** Leadership among physicians and other clinical
        leaders is mandatory to achieve successful health information
        adoption and information exchange. Strong and continuous
        leadership by clinicians who, as individuals or representatives
        of provider organizations, accept the responsibility for change
        management and motivation of clinicians critical to success.

    -   ***Activation*:** An objective, well-respected, authoritative
        source will be needed to convene the community and begin the
        discussions and activities needed to address legal issues,
        establish governance mechanisms and determine the business case
        and develop approaches that address the range of stakeholder
        needs.

    -   ***Vision:*** Establishing a strong vision is critical to
        maintaining focus and momentum and helps prevent potential
        derailment from individual organization or proprietary
        priorities.

    -   ***Governance and management:*** An inclusive structure with
        commitment by key leaders will be necessary to develop and
        manage the appropriate governance mechanism. Governance must
        establish clear responsibilities and processes for executing
        organizational and community plans.

    -   ***Technical interoperability*:** Organizations must understand
        and incorporate the technical standards requirements for
        interoperability in order to achieve on-going sustainability.

    -   ***Practice transformation activities:*** Clear definition of
        the functional requirements and resulting workflow changes is
        essential to enable sustainable adoption. Important components
        include organizational restructuring, resource allocations,
        clear work plans and training.

    -   ***Training***: Adequate overall and targeted training and
        resources are essential to enable sustainable adoption.
        Successful adoption must have the appropriate support
        infrastructure necessary to manage the timeframe required to
        initiate and complete the entire transformation and adoption of
        the health information exchange infrastructure.

2.  **Communities will require a source of activation to catalyze or
    enforce convening of a health information exchange infrastructure.**
    This source will be needed to convene the community and begin the
    discussions and activities needed to address legal issues, establish
    governance mechanisms and determine business case.

-   The "convener" should be a **neutral facilitator**, a role that
    could be played by a government entity or, **depending greatly upon
    market dynamics**, a number of different industry members:

    -   Major provider

    -   Major payer

    -   Business coalition

    -   Major employer

    -   Existing collaborative

    -   State government

    -   Unrelated third-party

        -   Large providers have a natural clinical technology adoption
            advantage due to their infrastructure and business
            arrangement with physicians that could be a strategic
            advantage in driving the majority of the market toward
            health information exchange. Given the adoption challenges
            of small and medium-sized practices, it may make sense to
            focus adoption strategies on larger providers in the
            near-term to drive critical mass in the market.

        -   Depending upon the degree to which communities identify a
            natural convener, the Federal government could take steps to
            encourage greater convening of communities including the
            following:

            -   Provide grants to facilitate community planning for
                health information exchange.

            -   Require state governments to develop an assessment of
                health information exchange activity readiness in their
                state and plans to encourage that development. This
                requirement could be linked to Federal monies for
                Medicaid.

            -   Work with accrediting agencies to include health
                information exchange plan development as a component of
                the accrediting process.

3.  **Most of the management and legal issues faced by communities and
    individuals in establishing a health information infrastructure,
    consistent with privacy and security protections, can be addressed
    in the context of existing law and through the use of contracts.**

-   The legal analysis reveals several measures and steps that health
    care purchasers and implementers will need to take to achieve more
    legal and management sustainability of information sharing. Our
    analyses provide a framework of areas that will require legal and
    contractual attention by communities.

-   Existing law and regulations can be leveraged, by organizations
    entering into information sharing relationships, to provide ample
    protection of private property, assert privacy rights, share
    information among multiple organizations, and provide protection
    from professional liability and medical malpractice.

-   Organizations and individuals can utilize several types of vehicles
    to mitigate risk such as corporate law, contracts, licenses, use
    agreements, service level agreements, syndication and other
    agreements.

4.  **As health information exchange implementations mature, significant
    issues that are currently poorly understood may require policy and
    regulatory changes to enable sustainable adoption.**

    -   With the changing nature of medical practice and new liabilities
        or duties arising from the use of electronic health records,
        possible areas for research and broad policy consideration could
        include the security and privacy, medical liability and practice
        transformation issues:

-   **Security and Privacy**

    -   Framework for the incremental development of local, regional,
        and national health information exchange that respects local
        ownership and control, and provides the technical requirements
        to support robust security and privacy.

    -   Robust security and privacy regime for interoperable regional
        and national health information system

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-   **Model professional liability and medical malpractice laws**

-   Reflect changing nature of medical practice in a connected world.
    Policy-based actions will be needed to appropriately define
    physician and clinician liability and negligence in the use of
    widely interoperable electronic health records for medical
    decision-making.

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-   **Practice transformation**

    -   Assess changes in medical practice and the relationships between
        stakeholders that are likely to result from the transformative
        nature of high degrees of IT adoption and use and regional and
        national interoperability.

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-   While policy recommendations may be premature and research
    inconclusive given the current stage of maturation, these issues are
    important for on-going examination related to health information
    exchange.

To ensure sustainability and continued progress at the local level,
investments will be needed. A wide range of activities, education and
information will be necessary including rigorous financial analysis to
support the incentive structure, implementation methodologies for small
practices, change management approaches and implications, draft policies
and procedures for information sharing, case studies, product
certifications and comparisons with user surveys and feedback,
collaborative forums to continually refine practice implications and
directories or brokering services for technical assistance to
individuals and practices. Investments like these will create experience
and work products that can be broadly shared across communities and
support physicians in achieving improved healthcare through clinical IT
application adoption as well as interoperability among other key health
care providers.

Working Group on Financial, Legal and Organizational Sustainability of
Health Information Exchange

**Peter Basch, MD,** Medical Director, eHealth Initiatives, MedStar
Health

**David Bates, MD, MSC,** Chief of the Division of General Medicine at
Brigham and Women's Hospital and Medical Director of Clinical and
Quality Analysis for Partners HealthCare System

**David Brailer, MD, PhD, (Original Chair)**\*, National Health
Information Technology Coordinator, U.S. Department of Health and Human
Services; formerly Senior Fellow for Information Technology and Quality
of Care, Health Technology Center

**Lawrence Casalino, MD, PhD,** Department of Health Studies, University
of Chicago

**John Glaser, PhD, (Current Chair)**\*, Chief Information Officer,
Partners HealthCare Systems Inc

**Rich Grossi, MBA,** Vice President and Chief Financial Officer, Johns
Hopkins Medicine

**Nancy Lorenzi, PhD,** Professor of Biomedical Informatics and
Assistant Vice Chancellor for Health Affairs Vanderbilt University
Medical Center

**Robert Miller, PhD,** Associate Professor, Institute for Health &
Aging and Department of Social and Behavioral Sciences, University of
California, San Francisco

**Peter Swire, JD,** Moritz College of Law, Ohio State University, John
Glenn Scholar in Public Policy Research; formerly, Chief Counselor for
Privacy in the U.S. Office of Management and Budget

**Lori Evans, MPH, MPP,** (Ex Officio member), Office of the National
Health Care Information Technology Coordinator, U.S. Department of
Health and Human Services; formerly Vice President and Program Director,
Foundation for eHealth

\* David Brailer initially chaired this Working Group. However, when HHS
Secretary Thompson appointed him the United States' first Health
Information Technology Coordinator on May 6, 2004, he was obliged to
resign as chair. Leadership of the group was graciously assumed by John
Glaser.

STAFF:

**Julie Vaughan Murchinson, MBA** Project Director, Consultant to the
Markle Foundation

##### 

##### Robin Omata, JD, PhD Legal Staff, Consultant to the Markle Foundation