The much ballyhooed Health Information Exchange (HIE) in the state of California, CalRHIO, has raised the white flag, dismissing its troops and sending home its arms supplier (Medicity).  Despite its founding five years ago, support of some significant organizations (e.g., United Health Group, Cisco, HP, California Hospital Assoc., etc.) spending some $7M to date and launching a major roadshow in March last year that included the go live of 23 institutions in Orange County in October, CalRHIO did not get the support of California’s Health and Human Services (CHHS) to be the state designated entity for overseeing ARRA funding for state HIEs.

Based on an article in California Healthline, a number of other organizations had some serious concerns with CalRHIO, enough concerns to start their own organization, the California eHealth Collaborative (CAeHC).  What is surprising here is that one of those that called into question CalRHIO’s operating model was its former CEO Lori Hack, who is now a board member of the competing CAeHC.  Primary concerns/issues with CalRHIO included:

Besides the obvious hit the Medicity takes (they widely promoted this win) and the egg on the face of many proponents of the CalRHIO, probably the clearest message here is that the governance issue of HIEs is extremely political, especially when a boat-load of federal Stimulus dollars are at stake.  The CalRHIO fiasco is unlikely to be the last one we’ll hear of over the next 3-9 months.