Three Big Questions for Stage 3 & Patient Engagement

big waveFor many, the delay of Stage 3 of the Meaningful Use program evoked a collective sigh of relief, providing a much-needed extra year to focus on the challenging requirements for patient engagement and interoperability. As distant as 2017 may seem however, the preparation for Stage 3 is already underway in Washington; the vendor community and providers will soon be scrambling to follow suit.

Barring further delays, the timeline is as follows: This fall CMS will release the notice of proposed rulemaking (NPRM) for Stage 3 and the corresponding NPRM for the Standards and Certification Criteria. The former is the programmatic framework for what to expect – measures, percentages, reporting requirements, etc., while the latter is the technical product guidelines for software vendors to follow in order to receive ONC certification as a Stage 3 compliant solution that will enable their customers, if properly implemented and used, to collect those sought-after incentive dollars. The final rule is expected to drop sometime in Q1-Q2 of 2015 – just one year away.

But that doesn’t mean there’s a year to put off thinking about it. In a few short weeks, the Health IT Policy Committee (HITPC) is set to deliver an official recommendation on the topic of Stage 3’s patient engagement requirements to the ONC. From all indications, it appears this super-group of wonks will press for inclusion of patient-generated health data (PGHD – yet another #ONCronym for your twitter streams) into electronic health record systems. The technical experts have defined PGHD as follows:

“health-related data—including health history, symptoms, biometric data, treatment history, lifestyle choices, and other information—created, recorded, gathered, or inferred by or from patients or their designees (i.e., care partners or those who assist them) to help address a health concern.”

At first glance, this is a no-brainer, as we’ve been hearing the clarion calls for such inputs for the better part of the last decade. 60 percent of US adults claim to track their weight, diet, or exercise routine, according to the Pew Research Center’s data. Evidence for the positive impact of this data on quality, satisfaction, and in some cases cost is thin but growing.

But as we are learning through the first two stages of this program as well as the early headaches of ACA rollout, reams of sophisticated studies floated down from the ivory tower do not effective policies make. Despite the need for PGHD, when it is wonkified, ONCified, and held to the temple of the nation’s delivery system, there may be a small disaster in waiting. Below are three questions Chilmark is keenly tracking throughout the remainder of 2014:

What Constitutes PGHD?
The language used thus far raises much speculation about what exactly this inclusion will mean when it hits the front lines. The definition provides only a general description, leaving a lot of possibility for interpretation and application down the road. For many, PGHD evokes the notion of datastreams from the vast array of health and wellness devices such as fitbits and jawbones, Bluetooth medical devices, and of course, tracking apps. Yet the definition above makes PGHD seem to carry more of an health risk assessment (HRA)-like utility, where patients fill out a survey and have it sent to their doctors in advance. Yet another angle is the notion of patient-reported outcomes: clinically oriented inputs from patients with regard to their physical and psychosocial health status. Outfits like ATA, HIMSS and others are lobbying for full inclusion of patient-monitoring and home-health data.

Each of these use cases brings with it a unique set of programmatic and technical components. A popular example as of late is with biometric data: If a panel of diabetic patients are all given Bluetooth glucometers that input into respective EHRs, then what – Will someone monitor each of them? Or are HCOs expected to fit those data into an algorithm that alerts and ultimately predicts any aberrance? This has been referred to as providing doctors with ‘insight’ rather than raw data. That sounds snazzy, but can we realistically mandate the creation of insight?

Collecting data such as patient allergies or side effects appears a simpler use case on paper. Yet HITPC is appearing to use everyone’s favorite A+ students – IDN’s like Geisinger, Kaiser Permanente, and Group Health Cooperative among others as the basis for their recommendation. As one example, the report lauds GHC’s eHRA model, which is based on a shared EHR and shared clinical staff for data review. As nicely as that may work, Chilmark is skeptical that it’s reproducible in an average clinical setting. Generally, the innovators in the digital engagement space have been the insurers, not the providers. We understand the need to look at innovators in order to prescribe a path for the rest of the country, but in talking to regular folks at urban hospitals, community clinics, mid-sized IPAs –it’s more likely that fluid data is a byproduct of integrated systems, not the other way around.

How Will the Market Respond?
Despite its unpopularity in the C-suite, meaningful use has forced EHR vendors to pull their heads out of the sand and advance their product features. In addition to giving providers a break, part of the reason behind the Stage 3 delay was for vendors’ benefit: “[to provide] ample time for developers to create and distribute certified EHR technology…and incorporate lessons learned about usability and customization.” The Standards and Certification Criteria 2017 edition will play a big role in the next lurch forward, and one can be sure that those new mandated features will be all the rage at HIMSS 2015.

Yet at the broadest level, the evolution of EHRs (billing >> administration >> clinical) appears to be stalling. In exploring the patient engagement market and the to-date limited functionality of tethered patient portals despite Stage 2’s requirements one thing has become clear: EHR vendors will simply not just add new features for the sake of their customers (forget about patients). With new PGHD functionality emerging, we expect new companies to step up to the plate and seek modular ONC-ATCB certification

An example already underway is 3rd party data integration. Over the last few years, device manufacturers, startups, and third parties started seeing the value in injecting their data into EHRs. The emergence of middleware companies who provide integration as a service, such as Nanthealth, Corepoint, and Validic, will continue as PGHD requirements develop over the coming months. Similar companies will start (and already are) filling the void for HRA functionality, portal requirements, patient communication, and so on. We expect that this will only exacerbate the headache faced by CIOs & CMIOs with a long list of purchasing options. Startups take note: It should also set off a shopping spree by EHR companies and other enterprise vendors looking to buy rather than build. Allscripts acquisition last year of Jardogs is one such example.

Will Providers be Ready?
In a word, no. The inclusion of PGHD brings with it an avalanche of procedural and programmatic preparation: data review and quality assurance, governance models and new workflows, the prickly issue of data ownership, staff time and training, liability concerns, HIPAA extension of coverage, ever-increasing insurer coordination, clinician accountability, and of course, patient consent, onboarding, and marketing. With the last one, keep in mind that we now live in the post-Snowden era…

Of course, without details of the required measures, further hand-wringing is unwarranted at this point. But suffice to say there’s a small storm-a-comin.’ As the definitions, rules, and standards of patient-generated health data emerge, we look forward to what promises to be a rich commentary and response to the NPRM amidst the broader discussion in the health IT community throughout 2014.

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What’s in Store for 2014?

zoltarThat time of year once again where we collectively look into our crystal ball, or throw the sticks or maybe even look at the coffee grinds dripping down the sides on our coffee cup to see what may be in the year to come. Making these predictions for the coming year is almost a rite of passage for any self-respecting analyst firm and what the heck, from our vantage point, we may have a slightly better view into the future than most.

So in keeping with some sense of tradition here at Chilmark Research, the following are our ten predictions for 2014, plus one (think of it like a baker’s dozen).

Meaningful Use (MU) stage two delay provides little relief to IT departments. Many breathed a sigh of relief when HHS announced that stage two timeline would be extended. Yet despite that extension, IT departments will remain overwhelmed in 2014 coping with a host of other initiatives, from ICD-10 to HIPAA compliance to preparing the organization for changing models of reimbursement and of course MU 2.

Best-of-breed solutions proliferate. Despite the desire to have as few as possible IT vendors and their solutions within an organization, department heads take it upon themselves to adopt new solutions as IT departments are not able to meet all the needs of the organization at this time, nor are EHR vendors capable of delivering new offerings in a timely manner. We anticipate analytics and care coordination to be high among list of adopted best-of-breed solutions. This will create its own host of problems several years hence.

Consolidation continues unabated in mid-market. Much to the concern of payers, large provider organizations will continue to purchase their smaller brethren to extend their reach and improve care coordination. Payers will fight back with lawsuits (monopolistic tendencies of providers) and by making their own acquisitions. Payers will be particularly attracted to the dual eligible market.

Bloom is off the rose as physician dissatisfaction with chosen EHR rises. OK, yes this is a no-brainer as we have been seeing discontent rise throughout 2013. But this discontent will escalate as smaller organizations increasingly realize that their EHR is ill-suited to address the needs of tomorrow in a value-based reimbursement world.

Limitations of deployed HIE becomes increasingly apparent. It’s one thing to put in an HIE infrastructure, quite another to embed HIE capabilities into clinician workflow, especially across a heterogeneous EHR community. Couple that with a growing realization among leading HCOs that to truly support clinicians at point of care, far more data is required to flow through the network and you end up with a lot of future head scratching as to where the real value realization will be derived from the HIE now in use.

Re-prioritization moves patient engagement to back burner. Despite the strong efforts of ONC/HHS to promote the concept of patient engagement, providers, no longer having the stage two gun to their head, will reset priorities on other, more pressing matters.

One third of stage one, MU-certified EHRs do not or choose not to certify for stage two. The HITECH Act created a false market for EHRs that led to the proliferation of vendors and their solutions. Unfortunately for many an ambulatory practice, their chosen EHR vendor will not have the resources to refine their product for stage two certification leaving smaller practices with the unenviable task of having to find a new vendor. Thankfully, a price war is anticipated as vendors look to build customer bases and subsequently valuations before inevitable acquisition.

Clinical analytics remains a hot, yet immature market. Leading HCOs are all clamoring for analytics to help run their operations and improve care delivery processes. But despite the high demand for such solutions, EHR vendors are still behind the curve in delivering such capabilities, the buyers still are not quite sure exactly what they want and rarely have the resources to begin asking the right questions. The best of breed vendors themselves struggle to keep up with market demand, leading to longer then anticipated deployment times.

Cloud-based EHRs become de facto standard for small, ambulatory practices. Pricing pressure will grow fierce in the ambulatory market and in an effort to lower cost of sales, shorten product lifecycles and improve customer service, ambulatory EHR vendors will move to cloud-based services for their solutions. Some push-back will occur over concerns of data governance and privacy. Physicians taking this path will need to review terms and conditions of such contracts carefully.

Payers increasingly become part of HIE fabric. In mid-2013, payers became increasingly involved in the HIE market partnering with leading providers in some communities to share data and improve care coordination. While providers have instinctively been reluctant to partner up with payers, the move to value-based contracts and the strong skills and critical data that payers can provide is forcing providers to re-evaluate their previous stance.

Healthcare.gov falls short – payers wring their hands. Healthcare.gov has far more sign-ups than detractors anticipated but falls short of administration goals, especially for the young and healthy. This leads to payers to continue wringing their hands over adverse selection of new enrollees and the likely higher risk profile as a result.

There you have it folks. Now let’s see how the year plays out and just how close these predictions are to reality come early 2015. Either way, never a dull moment in this market for the foreseeable future.

 

 

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Looking Ahead to Data Visualization & Blazingly Fast Database Technology

dataVizLast week I attended the annual Data Warehousing (TDWI) event in Orlando. This is a fantastic, intimate setting of the top experts, and plenty of novices, in data warehousing and analytics. The event is totally focused on education, with only a small amount of vendor hype.

Some interesting new things came out of the conference, and plenty of improvements for older analytic concepts and technologies.

The major takeaways were:

Data visualization has gone completely mainstream.
Clearly, presenting data visually — vs. in tables, or distributed as printable PDFs — is the dominating trend, although in HC we still see a lot of visually challenged information presentation. Really, there is no excuse given the availability of easy to use and low cost visualization tools. Time to move beyond boring tables.

There are two flavors of data visualization along a continuum vs. distinct markets. Visualization products span from tools and usages for high-powered end-user analysts, to on-the-spot at-a-glance dashboards to assist production type activities. All products are beginning to overlap each other covering both ends of the visualization spectrum. Vendors with dashboards have made them interactive and vendors with complex data discovery and modeling approaches offer ways for mass deployment of the analytic conclusions converting them to end-user dashboards with one click.

The other manifestation of the popularity of data visualization is that the large BI vendors are catching on. SAP/BusinessObjects is offering a free, very useful desktop data visualization tool (Lumira), with a paid version adding more features (basically database connectors). IBM/Cognos is about to release a new data visualization tool, also. Then you have a growing number of third party data visualization tools that continue to improve (i.e. Yellowfin, Tableau, Qlikview, DOMO, etc.). Plus, cloud BI vendor Birst is also getting on the visualization bandwagon.

Finally, rationalization of the whole so-called “big data” market.
People are finally getting it that most users, especially in healthcare, do not have a big data problem. Most of the selling points for big data can be easily accomplished with traditional analytics tools and database technology. Last year I wrote a Monthly Update titled “Big Data for the Rest of Us.” If I had to do it again it would be “Big Data NOT for the Rest of Us.”

Seems like the appropriate entry point for real big data technology (basically Hadoop and variants) is when you have a lot, and I mean a lot, of unstructured data being produced and stored. This means, de facto, machine generated data and most likely unstructured machine generated data. I am talking about systems that generate 200,000 transactions per second and up. Certainly no EHR or LIS in even the largest IDN is producing these kinds of data volumes. Even Healthcare.gov, as is stumbles to life, will ever reach that kind of volume.

In healthcare, Big Data is mostly a big distraction – more hype than reality.

Database engineers are busy creating mind-blowing, architectures.
Lots of new ideas in terms of performance architecture and cloud solutions. memSQL was there showing mind bending performance doing hundreds of thousands of insertions per second into an relational database, while simultaneously executing complex multimillion row queries in seconds, this across a geographically dispersed cluster of cheap Linux servers. TreasureData had its innovative agent based cloud database product on display. This architecture greatly reduces the latency of hauling data from the generator systems to the analytics processes.

TDWI continues to amaze and is never boring. I just love this type of event where you can rub elbows with the best minds in the analytics world has to offer in a non-sales oriented forum. Truly a great event.

 

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Whose Data is it Anyway?

privacyA common and somewhat unique aspect to EHR vendor contracts is that the EHR vendor lays claim to the data entered into their system. Rob and I, who co-authored this post have worked in many industries as analysts. Nowhere, in our collective experience, have we seen such a thing. Manufacturers, retailers, financial institutions, etc. would never think of relinquishing their data to their enterprise software vendor of choice.

It confounds us as to why healthcare organizations let their vendors of choice get away with this and frankly, in this day of increasing concerns about patient privacy, why is this practice allowed in the first place?

The Office of the National Coordinator for Health Information Technology (ONC) released a report this summer defining EHR contract terms and lending some advice on what should and should not be in your EHR vendor’s contract.

The ONC recommendations are good but incomplete and come from a legal perspective.

As we approach the 3-5 year anniversary of the beginning of the upsurge in EHR purchasing via the HITECH Act, cracks are beginning to show. Roughly a third of healthcare organizations are now looking to replace their EHR. To assist HCO clients we wrote an article published in our recent October Monthly Update for CAS clients expanding on some of the points made by the ONC, and adding a few more critical considerations for HCOs trying to lower EHR costs and reduce risk.

The one item in many EHR contracts that is most troubling is the notion the patient data HCOs enter into their EHR is becomes the property in whole, or in-part, of the EHR vendor.

It’s Your Data Act Like it
Prior to the internet-age the concept that any data input into software either on the desktop, on-premise or in the cloud (AKA hosted or time sharing) was not owned entirely by the users was unheard of. But with the emergence of search engines and social media, the rights to data have slowly eroded away from the user in favor of the software/service provider. Facebook is notorious for making subtle changes to its data privacy agreements that raise the ire of privacy rights advocates.

Of course this is not a good situation when we are talking about healthcare, a sector that collects the most personal data one may own. EHR purchasers need to take a hard detailed look at their software agreements to get a clear picture of what rights to data are being transferred to the software vendors and whether or not that is in the best interests of the HCO and the community it serves..

Our recommendation: Do not let EHR vendor have any rights to the data – Period!

The second data ownership challenge to be very careful of is the increasing incorporation of patient generated health data into the healthcare delivery system. We project an explosion in the use of biometric devices, be it consumer purchased or HCO supplied, to monitor the health of patients outside of the exam room. Much of this data will find its way into the EHR. Exactly who owns this data and what rights each party has is still debatable. It is critical that before HCOs accept user data they work out user data ownership processes, procedures, and rights.

If the EHR vendor has retained some rights to data the patients need to be informed and have consented to this sharing agreement. In our experience this is rarely if ever explicitly stated. HCOs need to be careful here as this could become a public relations disaster.

We are not lawyers, we are offering our advice and experience to HCO CEOs, CFOs and CIOs, from the perspective of business risk and economics. At Chilmark we have deep experience in best practices used in other industries with regards to data use and sharing agreements. We have also spent significant time reviewing the entire software purchasing lifecycle and culture, and are here to help HCOs in reviewing these contracts.

Addendum: Rob and I worked together on this post but our WordPress backend doesn’t like to do co-authored posts.

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Can Mirth Revive NextGen?

Last week, NextGen’s parent company, QSI, acquired open-source tools vendor Mirth for $59M. While a relatively small acquisition, it nonetheless will have an impact on the broader HIE market. Mirth’s toolset has an array of HIE components, notably its well-regarded Mirth Connect integration engine, the cornerstone of its commercial and open-source success to date.

The acquisition confirmed two critical points we made in our 2013 HIE Market Trends Report:

1) EHR vendors need new and better ways to support clinical interoperability in an increasingly heterogeneous EHR world and
2) that consolidation in the HIE market will continue unabated.

Mirth, was never a full-bodied HIE vendor, but has been a steady presence in the market as a component supplier to HIEs and HIE vendors, notably Harris and Covisint among others. Its open-source tools get potential customers in the door who can then convert to a commercial license. In a call with Mirth executives, post acquisition, they stated that today, there are nearly 650 commercial licensees of Mirth Connect – for clinical interoperability projects.

Mirth’s integration engine, Mirth Connect, is not as widely deployed in production environments as most of its competitors (i.e., Orion Health, Corepoint, InterSystems or Infor). However,, Mirth Connect has found its way into a variety of prototyping and testing environments for HL7 messaging and EHR integrations. For many developers and healthcare systems, its no-cost, initial cost has been irresistible to desperate HL7 developers around the industry with Mirth claiming some 25,000 active open source licenses out of the 100,000 plus downloads of Mirth Connect.

While Mirth Connect is the cornerstone of Mirth’s product suite, the company does offer other tools that are commonly found in HIE deployments including a data warehouse and master patient index (MPI).

Like other open source vendors, Mirth has grown by selling wrap-around services to healthcare organizations (HCOs) that use its solutions for more extensive and complex deployments. Accordingly, Mirth pops up on our radar screen in discussions with public and enterprise HIEs. Mirth has also been very active in the efforts of the EHR Vendor Affinity Group for the Beacon Community, convened by ONC. But despite its well-received tools and commitment to better clinical interoperability, Mirth has always been somewhat hamstrung by its organizational reach, resources and delivery capabilities.

With this acquisition, NextGen will now use Mirth products for the 90,000 physician users of its community EHR offerings. In speaking with a senior executive at NextGen, she informed us that NextGen plans to preserve Mirth’s independence, retaining the Mirth brand, staff, offices and existing partner relationships and software licensing terms.

We see this acquisition of Mirth as a relatively low cost way for NextGen to accomplish two goals:

1) Do what it could not accomplish internally; develop a cross-enterprise interoperability platform for its current and future customers.
2) Reinvigorate the company and its market luster.

Main Street Realities and Wall Street Expectations
Quality Systems is under pressure to change for two sets of reasons: the dynamics of the community EHR market and the requirements of Wall Street.

These are unsettled times in the community EHR market as physicians gain more day-to-day experience with EHRs, leading inexorably to heightened expectations for EHRs. While the giants of the community EHR market boast like Roman emperors about their offerings, single-digit market shares and rumors of mass EHR replacements have vendors looking over their shoulders. NextGen, like all community EHR vendors, has customer retention concerns and must take product actions so its customers can participate in new models of care at both the patient and population level.

The acquisition of Mirth is also a tacit admission that NextGen’s EHR Connect has not been entirely equal to the complex task of providing cross-enterprise EHR interoperability for its customers. NextGen EHR Connect, like similar offerings from most EHR vendors, does not readily support interoperability in a heterogeneous EHR environment.

While the company is making all the right noises about how Mirth can help provide more interoperable data to support new payment models and population health management, it is unclear why NextGen took this specific product action: buying – rather than partnering with – a company to achieve this goal. After all, plenty of HIE vendors, EHR vendors and HIT integrators thrive using partnerships to get any or all of the tools that Mirth sells.

The explanation probably lies in Quality Systems, Inc.’s (QSI) relationship to Wall Street. The company is now “dead money” in Wall Street lingo. It certainly has fared less well than some its competitors (see chart for an unflattering 1-year comparison with Cerner, athenahealth and even down on its luck Allscripts). A hedge fund owner forced QSI to take on three new board members this summer and reevaluate the company’s “strategy”.

This acquisition could be more related to how the company is perceived by Wall Street than Main Street HIT customers and partners. Buying Mirth was relatively cheap – $59 million reportedly – and, in the Wall Street worldview, a way to burnish NextGen, with its roster of captive physician customers, thereby making it a more attractive target to the usual roster of larger, acquisitive HIT and private equity companies.

Licensing Caution for Mirth Customers and Partners
For existing Mirth customers, product licensing could become problematic over the long term. While NextGen is committed to preserving Mirth’s existing open-source and commercial licenses, the pressure to deliver better revenue results is on at NextGen and the company will eventually turn its attention to increasing the revenue yield of solutions built with Mirth tools that are now spread across many HCOs.

For Mirth’s open-source customers, the transition to some kind of NextGen master license from Mirth’s Mozilla-derived license could introduce unwelcome changes in the form of decreased deployment flexibility or increased direct or indirect costs. These customers could experience higher than expected costs and contractual complexity as they expand their deployments to support new needs or more users. All Mirth customers risk being stranded on existing software as NextGen evolves the software and licensing terms of future versions of Mirth tools to suit its needs. NextGen’s commitment to or interest in preserving the licensing rights or upward compatibility of existing customers is a question mark over the long term. If QSI itself is acquired, that uncertainty multiplies.

For Mirth partners, the foregoing concerns could be more significant. We know that HIE vendors Harris and Covisint have relationships with Mirth under which they use a variety of Mirth tools. We can only hope that these and other partners contemplated that Mirth could be acquired – and its new parent could in turn be acquired – when negotiating the terms of their partnership agreements and licenses. If not, they and their HCO customers could be surprised as Mirth’s licensing terms change to meet the business needs of its new owners.

Granted, all Mirth customers have the current source code should NextGen indeed change terms and conditions in unacceptable ways, this may put some of these companies in the position of directly supporting the code base going forward.

Consolidation Continues and EHR Vendors Interoperate

The bottom line is that this acquisition is more evidence of consolidation in the market for clinical interoperability and for the technology stack found within HIE solutions suites. NextGen is not the only EHR company to acquire HIE technology with Allscripts having acquired dbMotion earlier this year and Siemens acquired MobileMD nearly two years ago. It is also evidence of EHR vendors’ need for better interoperability technology and the inadequacy of existing EHR vendor solutions for connecting care communities in the new world of payment reform.

If history is any guide though, HIE-related acquisitions by EHR vendors do not bode well for this acquisition of Mirth. Over the last several years several HIE vendors have been acquired by EHR vendors. In all cases, these acquisitions have led to the former independent HIE vendor to be but a shadow of its former self.

 

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Pushing the Envelope to HIE 2.0

Innovation driven by the effective use of IT has long catalyzed industry transformations – except in healthcare.

We all know people who have never waited in a teller line to cash a check. In the now unlikely event that systems fail, it would be a new experience for many to actually go to a teller to conduct a transaction with a bank.

Patients still get diagnosed and treated with or without electronic health records (EHRs), health information exchanges (HIEs), or any of the panoply of IT-based tools used by clinicians and their organizations. Goose quills wielded by the credentialed are the universal backup plan in healthcare. IT has thus far not been mission-critical the way it is now for other industries. We find this somewhat surprising as healthcare is such a knowledge intensive industry. Logic and reason would argue for wide-spread adoption and use of IT, but such has not been the case, that is until recently.

Inexorably, the healthcare industry is undergoing massive transformation and IT is seen as playing an absolutely pivotal role in the future effective and efficient delivery of healthcare. Among the multitude of IT vendors targeting healthcare, HIE vendors are pushing hard to make IT truly mission-critical.

We saw this trend coming several years ago when we initially launched our unparalleled, in-depth research on the HIE market, which continues with the release of the 2013 HIE Market Trends Report next week. In the last several years, HIE developers’ brainpower, as well as that of their customers, has focused on getting existing installations to function at adequate levels. in the last year or so, vendors have zeroed in on improving deployment timeframes to decrease time to value. While this is a laudable goal, its end result has been an actual decline in innovation in the HIE market – a key finding in our 2013 HIE report. It shows that 2012 was most notable for a pause in innovation, even among the strongest vendors.

Future of HIE Hinges on Reimbursement, Which Remains Uncertain
The healthcare market is shifting faster than HIE vendors, partially because two things are happening at once. Stage 2 meaningful use will go into effect in 2014, causing (healthcare organizations) HCOs to seek interoperability solutions in large numbers. An even more significant driver for interoperability solutions is the ongoing conversion to value-based reimbursement across the healthcare sector. This transformation, with its ever-mutating timetable, radiates uncertainty.

For example, in December, one HIE vendor executive told us he believed the strategic imperative for larger HCOs to connect to their affiliates had been overstated. He and his colleagues saw the shift to value-based care as a process that would unfold over many years and the company planned to help its customers connect to affiliates as fee-for-value slowly became a reality. By late May, the same vendor had executed an about-face and – like every vendor in the report – had gone all-in on supporting new models of care delivery and reimbursement – right now.

Fast forward to two weeks ago and we see data indicating that providers are considering bailing out of the Pioneer ACO program for reasons that are still obscure. Last week UnitedHealth Group predicted its accountable care business will more than double in the next few years from its current $20 billion base. You can’t blame HIE vendors for feeling whipsawed.

Vendors Embrace Care Coordination, Or Exit Stage Left
While the pace of transformation to value-based reimbursement keeps everyone guessing, the momentum is clearly away from fee-for-service. Every vendor interviewed and profiled in the HIE report has plans to provide better support for care coordination so that HCOs and clinicians can band together to maximize payments and care quality while minimizing penalties. Yet, nearly all vendors have a slightly different take on how to enable such capabilities.

Some are focusing on specific clinical processes like referrals or cross-enterprise medications reconciliation. Others are focusing on knitting together HCOs, clinicians, and patients with robust notification services embedded in the diverse EHRs and devices found in connected care communities. But the key word here is “plans.” No HIE vendor is currently able to meet the demands of this transformation in the industry – whatever its eventual pace. We dispute the naysayers who insist you can’t get there from here, and believe the HIE vendors profiled in this report are pushing hard to get in front of this transformation, a transformation in HIE capabilities to a future state we have termed HIE 2.0.

Outlook for HIE 2.0
The main theme of this report is the evolution to what we call HIE 2.0. We introduce a revised maturity model that starts at messaging-based HIE 1.0 and ends at HIE 2.0 where multidisciplinary care teams working across organizations collaborate to care for patients and patient panels using HIE-enabled care planning tools and applications. While some will undoubtedly quibble with the specifics of this maturity model, it sets forth a clear path to an endpoint where HIE technology will begin to assume a more mission-critical role in care delivery.

To support this new maturity model, we have in-turn defined the capabilities that HIE vendors will need to enable in an HIE 2.0 solution suite. THis capabilities are outlined in the table below.

Messaging Rises to the Level of Its Incompetence
While messaging will be an integral part of HIEs until time itself wears out, messaging-based HIEs have gone as far as they will go from a use-case standpoint. There are still a lot of faxes, phones calls, and letters that messaging could replace, but the limitations of messaging as a way to support complex, multi-enterprise clinical workflows are obvious to nearly everyone in the industry. Messaging diehards persist but their numbers continue to dwindle.

In the future, messaging will be supplemented with more robust notification services built into HIE-enabled collaborative care plans that deliver the right information, in the right context, to the right clinicians at the right times, on the devices or in the clinical applications of their choice. Moreover, many of the advanced applications of HIE 2.0 will be built using query-based services that take more fulsome advantage of the longitudinal patient record. A caution here is that Stage 2 meaningful use requires the use of Direct Secure Messaging protocols for certain transactions. This is not only driving strong demand from HCOs but also causing HIE and EHR vendors to include Direct-based services in their product plans. For reasons detailed in the report, this technological detour into messaging is a dead-end.

Lower Rankings Yet Reason for Optimism
For readers familiar with our past HIE Reports, we must mention that all vendor rankings are lower this year. This reflects the need to adjust the ranking criteria to reflect increasing expectations of HCOs and changing market requirements. HCOs need more from their HIEs than ever before – more functionality, more use cases and better reliability, availability and servicability. No vendor is remotely close to being able to assemble an HIE 2.0 solution right now. But many vendors are pushing hard and we expect the best to begin rolling out HIE 2.0 products by the middle of 2014

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