HIT grants will expand health data exchange, but are they enough?

Washington has awarded millions in HIT grants to start health information exchanges. State officials think much more money is needed -- and they wonder where it will come from.

When it comes to state health IT (HIT) grants, it is hard to tell if the glass is half full or half empty. At this week's Health Stimulus Exchange conference in New York, state leaders came down on both sides of the debate.

The HIT grants were allocated by the Health Information Technology for Economic and Clinical Health (HITECH) Act and are administered by the Office of the National Coordinator (ONC) for Health Information Technology. They aim to facilitate states' development of health information exchanges (HIE) among providers, payers and regional health information organizations, or RHIOs, and could eventually reach $564 million nationally.

On the positive side, that sounds like a lot of money. Combined with local and regional funding, the health IT grants could go a long way toward building out the electronic medical record infrastructure and data sharing between patients and providers that the Obama administration sees for the future -- all in the name of improving health care outcomes for the long haul.

On the negative side, those state HIT grants might not get the ball rolling. The economy has yet to recover from the worst economic downturn since the Great Depression, so the grants effectively stick cash-strapped state governments with much of the tab for a partially funded mandate.

Bill O'Byrne, state coordinator for HIT development in New Jersey's Office for e-HIT, called its recent $11.4 million ONC grant "seed money ... just a drop in the bucket" compared with the costs associated with developing four HIEs, three of which are funded with state and federal monies.

O'Byrne hopes the statewide regional extension center (REC) -- funded by its own $23 million ONC grant -- will help in the effort to get New Jersey's 5,800 providers into the network and contribute to a standard infrastructure. Moreover, a $6 million grant given to New Jersey Medicaid to develop a health IT implementation plan will defray some of those costs as well.

In total, the funding is "less than woefully inadequate," O'Byrne said. By his estimate, the $11.4 million from ONC will be enough only to sprout the HIEs.

The providers get hurt, and the payers just sit there with their money.

Bill O'Byrne, state coordinator for HIT development,
New Jersey's Office for e-HIT

"It is not going to build the infrastructure for a statewide network," O'Byrne said. "Consequently, my primary function in the last two years has been trying to figure out -- and get somebody to honor -- the problem of what we're going to do when we get these [HIEs] started. I still do not have an answer. This issue is happening at the absolute worst time in New Jersey's economy. It could not be worse. The governor has point-blank said there is no money available for any discretionary spending."

On the other hand, David Whitlinger, executive director of the New York eHealth Collaborative, is helping plan and implement New York's state health IT build-out with considerably more -- about $115 million -- in state and federal HIT grants, as well as $60 million in individual project grants.

New York's main health IT issue is getting providers online, not building the infrastructure for information exchange, Whitlinger said. "Exchange is very, very meaningful -- once you have more things to connect. If you don't have a lot of providers participating, adoption is a bigger problem."

Should payers help providers achieve meaningful use?

O'Byrne called out payers to bridge the gap left by shortfalls in grant money and the amount budgeted by the state of New Jersey for building a health IT infrastructure. His point? Payers also profit from the efficiencies created by electronic data exchange. Ultimately it might not be enough to give providers incentives to build out infrastructure -- and disincentives if they don't -- without involving the payers.

"The providers get hurt, and the payers just sit there with their money. We're going to have all of these standards. Yes, they are moderate and less than moderate in the beginning of meaningful use -- but they are still standards, and the ones that suffer are the providers," O'Byrne said. "I am wondering, at least in New Jersey, what the payers are doing to help providers become meaningful users."

O'Byrne and Whitlinger agreed that RECs will be key participants in the health IT build-out, providing sound, vendor-neutral advice to physicians and larger providers for implementation. This advice, furthermore, will take into consideration how the state's HIEs will work together -- and which software best connects with them -- as network infrastructure grows.

Let us know what you think about the story; email Don Fluckinger, Features Writer.

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