Health Information Exchanges and Megachange

Editor’s Note: In this paper, Darrell West and Allan Friedman study how state-level health information exchanges (HIEs) are implemented, where there are opportunities for action and who drives policy change. This paper looks at the current climate for organizational change and study the challenges faced by HIEs and how new technology is moving forward to overcome them; the scholars argue that for these megachange efforts to be effective, policymakers must present a clear vision, achieve consensus on key objectives, overcome organizational and market fragmentation, and work effectively with a range of different constituencies. In particular, this paper addresses the effectiveness and viability of HIE’s in Indiana, Massachusetts, New York, Tennessee, and California and explores why Massachusetts and Indiana are most successful across a number of metrics. CTI also hosted a forum on HIEs to discuss the paper.

Executive Summary

The United States faces a number of large-scale policy challenges. Economic development, job creation, deficit reduction, tax reform, health care, immigration, and national security all represent areas of high political, policy and organizational complexity. Each one faces enormous contentiousness over vision, goals, strategies, and tactics. There is little agreement on basic approaches to these policy subjects, and there are multiple organizations and government jurisdictions involved in administration and implementation. The sheer complexity of action in these areas makes it difficult to resolve conflict and implement effective solutions.

In this paper, we analyze state health information exchanges (HIEs) as an example of what MITRE researcher John Piescik calls “megachange” challenges.[ii] According to the U.S. Department of Health and Human Services, HIEs are “efforts to rapidly build capacity for exchanging health information across the health care system both within and across states.”[iii] This includes insurance information for those without coverage and clinical and medical data in order to connect health care providers and payers. The goals are to increase the flow of information across relevant organizations and improve the efficiency and effectiveness of the health care system.

These organizational innovations are an interesting example of policy change in a big and complex area. Health care represents nearly one-sixth of the overall economy and has costs that are growing well beyond the inflation rate. There are multiple actors such as patients, physicians, hospitals, vendors, payers, and advocacy organizations that are important to health care. It generally has been difficult to forge policy agreements among the various constituencies who are involved in this domain.

To develop a better understanding of megachange and health care, we look at a variety of questions. Using interviews, case studies, and documentary research, we study how state-level HIEs are implemented, what drives policy and organizational change, what the opportunities for action are, what barriers come up, and how HIEs are moving forward to overcome particular problems.

Briefly, we find that state health information exchanges have made progress in establishing organizational frameworks, building technology-based connections, and bringing relevant groups to the table for discussion.  However, barriers remain in terms of governance, financing, and policy vision.  Many states and localities have experienced difficulties in producing consensus on strategies and approaches, and identifying consistent revenue streams.  Some question whether the state level is the proper unit for HIEs given natural marketplaces centering on localities or regions.  Until those problems are overcome, it will be impossible for HIEs to achieve their full potential.

These findings have ramifications for U.S. efforts to bring large-scale change to many different policy areas.  Our analysis suggests that for megachange efforts to be effective, policymakers must present a clear vision, achieve consensus on key objectives, overcome organizational and market fragmentation, and work effectively with a range of different constituencies.  There needs to be adequate financial resources and sustainable business models to support proposed changes and public and private leaders must have incentives to work well together in relationships based on mutual trust.

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[i] Kent Weaver, “But Will It Work?:  Implementation Analysis to Improve Government Performance,” Issues in Governance Studies, February, 2010.

[ii] John Piescik, “Megachange:  Leading Change Across Multiple Large Organizations,” McLean, Virginia:  MITRE Center for Enterprise Modernization Technical Report MTR070320, November, 2007.

[iii] U.S. Department of Health and Human Services, “State Health Information Exchange Cooperative Agreement Program,” August 10, 2011.