Assessing Health Information Technology In Ohio

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Assessing Health InformationTechnology in OhioBriefing Paper for the 2005 OhioHealth Information Symposium“Information technology must play a centralrole in the redesign of the health care system ifa substantial improvement in health care qualityis to be achieved during the coming decade.”—Crossing the Quality ChasmHealth Policy Instituteof Ohio

AcknowledgementsThis paper was funded by the Health Policy Institute of Ohio and researched and written by the eHealth Initiative, withthe Legal Summary and Legal Assessment section researched and written by Benesch, Friedlander Coplan & Aronoff,LLP. The Health Policy Institute of Ohio would like to thank both organizations for their work.Specific acknowledgements for the research and writing of the paper go to:Emily Welebob and Sharon Canner of the eHealth Initiative Foundation; Dawn Mays of the VanderbiltCenter for Better Health (a Collaborating Partner for State and Regional HIT Policy Initiative); and RyanHooper and Martha Sweterlitsch, Benesch, Friedlander Coplan & Aronoff, LLP.External reviewers of the paper were Rick Sites, Nancy Gillette, Rick Moore, and Christine Knisely. Reviewers andcoordinators at the Health Policy Institute of Ohio were Stephanie Jursek, Philip Powers, Janet Goldberg, Jason Sanford,Jill Huntley, Benjamin D’Angelo, and William Hayes.The Institute would also like to thank the Ohio Health Information Technology Steering Committee for their work infostering dialogue about this issue in Ohio. The Ohio Health Information Technology Steering Committee, sponsoredby The Health Policy Institute of Ohio, is composed of individuals representing diverse private and public organizationswith a stake in the future of Health Information Technology in Ohio. Membership is voluntary. They represent, in part,the following organizations:Benesch, Friedlander Coplan & Aronoff, LLP; OHIO HIPAA Implementation Organization for EDI; WEDI;Ohio Academy of Family Physicians; Center for Health Communities at Wright State University; OhioKePro; Ohio Hospital Association; Ohio State Medical Association; Ohio Osteopathic Association; Centerfor Health Care Research and Policy at MetroHealth Medical Center; Board of Regents HealthBridge; OhioState University Medical Center; Ohio Department of Development; Ohio Health Information ManagementAssociation; Ohio University; HTP; Ohio Association of Free Health Clinics.Assessing Health Information Technology in Ohio copyright 2005 by the Health Policy Institute of Ohio.All rights reserved.To cite this work, please follow this format:Health Policy Institute of Ohio, The. (2005). Assessing Health Information Technology in Ohio. Columbus, OH:Author.Permission is granted to reproduce this publication provided that these reproductions are not used for a commercialpurpose, that you do not collect any fees for the reproductions, that our materials are faithfully reproduced (withoutaddition, alteration, or abbreviation), and that they include any copyright notice, attribution, or disclaimer appearing onthe original. Free copies of our publications are available; see back cover for more information.October, 2005

Table of ContentsExecutive Summary . 4I. Understanding the National Agenda. 5A.Background . 5B.The Case for Change: America’s Health Care Crisis . 5Harnessing HIT for Better Patient Care and Health Care IT Investment: Playing Catch-upC.Strategies Underway to Address Barriers to Health Information Technology Adoption. 8Standards; Organizational/Clinical Process Change; FinancingD.The Role of Federal and State Government. 9The Administration; Congress; The StatesE.Leadership in the Private Sector – Quality Initiatives . 12Bridges to Excellence (Multi-state); The Leapfrog Group (Multi-state);The National Committee for Quality Assurance (NCQA) (Multi-state);WellPoint Health Network (Multi-state); Integrated Healthcare Association (California)F.A Closer Look at Emerging Health Information Initiatives. 14II. Overview of Ohio . 15A.B.Background . 15Ohio Statewide and Economic Development IT Initiatives . 15Bioterrorism; Medicaid; Regional Technology Strategy;Third Frontier – The Third Frontier Network (TFN); HealthBridge;Ohio KēPRO – Ohio’s Medicare Quality Improvement Organization;Tri-River Employers Healthcare Coalition (Ohio); Ohio Hospital AssociationC.“What We Heard” from Ohio Leaders . 19Barriers to Health Information Technology Adoption;State Wide vs. Regional Approach to Health Information Technology Adoption);Ohio Health Care Priorities;Forum for Policy Discussion of Ohio Health Information Technology Needs;Benefits of HIE Implementation;D.Responses to Survey by Segment . 20Hospitals (including Academic Medical Centers);Physicians and Health Centers; Employers and Health Plans;Information Technology; Consumer GroupsE.HIT Initiatives in Ohio . 22F.Ohio’s eHealth Legal Summary . 22General Duty to Maintain Data Privacy; Medical Records Statutes and Regulations;Record Retention; Electronic Signatures;Telemedicine; AntitrustFraud and AbuseG.Ohio’s eHealth Legal Assessment: Progress and Challenges . 28Confidentiality and Security; Electronic Prescriptions; Record Retention; Electronic Signature;Telemedicine; Antitrust; Fraud and Abuse; Malpractice ConsiderationsIII. Conclusion . 30IV. Appendices . 31Appendix A: Recent Federal Legislation; Appendix B: Sampling of State and Regional HIE Initiatives;Appendix C: Third Frontier Network Map; Appendix D: Ohio Interview Participants;Appendix E: Catalog of Ohio HIT and HIE Initiatives; Appendix F: GlossaryIV. Notes. 46

Executive SummaryConsensus has emerged among leaders in both thepublic and private sectors that Health InformationTechnology (HIT) and Health Information Exchange(HIE) play a key role in addressing the mountingchallenges facing our nation’s health care system.The Institute of Medicine (IOM), some of the nation’slargest employers, provider and physician groups,members of Congress, nearly every federal governmenthealth care agency, a growing group of governors,and President Bush all have called for investment inelectronic health records and HIT.Despite evidence that information technology improvesthe quality, safety and efficiency of patient care, ournation’s health care industry lags far behind otherindustries in information technology (IT) investments.The reasons for this lag consist of: a lack of standards adoption necessary to createinteroperability across systems; complex organizational and clinical processchange requirements; privacy and confidentiality concerns; and the lack of financial incentives for using HIT.Interoperability is one of the most difficult problemsfacing the creation of a national IT infrastructure forexchanging health data. Among current IT investments,interoperability is a 21st-century health care systemrequirement that can transform the current health caresystem by decreasing health delivery costs; ensuringthat patients have access to the highest quality, mostefficient, and safest care; and ensuring that providershave access to a longitudinal electronic health record.And in light of recent natural disasters and bioterroristevents, the need for interoperability has becomeheightened to ensure that systems can communicatewith emergency workers during disasters.National health care leaders in both the public andprivate sectors are beginning to tackle these barriersthrough a growing number of diverse initiatives atthe federal, state and local levels. At the local level,over 100 nascent or operating health informationorganizations or initiatives in nearly every state ofthe nation are emerging to tackle a wide range ofissues. Many projects are focused on developing ahealth information infrastructure to deliver clinical4results and information to practicing cliniciansand other providers at the point of care. Others areseeking to facilitate patient-provider communication,eligibility and enrollment checking, and the use ofdata for reminders or consultations. The key themesheard throughout the country are the need for nationalstandards, the need for interoperability, the need forincentives to adopt HIT, and the need for privatepublic sector collaboration.The interest of Ohio’s leaders in HIT and HIE isreflected in various local HIT and exchange effortsacross the state. There have been various sponsors ofHIT and exchange conferences held throughout thestate to inform and raise awareness of participants aboutnational and local HIT efforts, provide opportunitiesfor networking, and inspire state champions to becomeadvocates for health care transformation by HIT. Ohiois home to nationally-recognized and award-winningHIT initiatives within large hospital systems andacademic settings, as well as HIE initiatives.Interviews with over thirty Ohio state leaders confirmthat HIT is increasingly viewed as an important toolto address the health care challenges facing the state.High health care costs and the need to improve qualityoutcomes are contributing to a sense of urgency inOhio and many health care leaders see a window ofopportunity to seek real and needed change in Ohio’shealth care system. Yet, most believe that the issue hasyet to mature as a policy priority in the state. Interviewparticipants viewed financing as the main barrier toprogress demonstrated by a low HIT adoption ratefor physician offices. Competition is also a commonconcern, and some are skeptical that competitivemarket forces will allow broad scale opportunities forHIE. Rural health care delivery is also a challengeto “wire,” but some expressed that rural environmentsmay have less organizational obstacles and shouldbe the priority. Overall, the leaders interviewed arewilling to participate in efforts to establish informationexchange organizations within their local communities.Most express a desire to communicate across regionalprojects, as appropriate, and to devise a broader visionfor HIT adoption and HIE in Ohio.In the coming months, as Ohio witnesses the continuedevolution of national events, as well as developmentswithin the state, it is important to begin to lay afoundation to enhance HIT adoption and the creationof HIE initiatives. The pressures on the system areinevitably going to force change. The 2005 OhioHealth Policy Institute of Ohio

Health Information Symposium on October 17, 2005,in Columbus, Ohio, involves multiple and diversehealth care leaders and stakeholders in Ohio. Thesymposium presents a timely opportunity to begin todevelop a shared vision and plan for addressing healthcare challenges through information technology andhealth information networks to improve access andhealth care delivery for the people of Ohio.I. Understanding theNational AgendaA. BackgroundThere is enormous momentum around HealthInformation Technology (HIT) and Health InformationExchange (HIE) at the national and local levels.Leading authorities such as the Institute of Medicine(IOM), some of the nation’s largest employers, providerand physician groups across the country, membersof Congress and nearly every federal governmenthealth care agency have called for investment inelectronic health information systems deployment.Even President Bush, during an address in April 2004,declared that every American would have an electronichealth record within ten years.1Toward this end, the President created a new subCabinet Level post: the National Coordinator forHealth Information Technology, reporting to theSecretary of the Department of Health and HumanServices (DHHS). Recently, Secretary Mike Leavittannounced plans to work with hospitals, physicianpractices, insurance companies and vendors through afederally-charted, private-public collaboration calledthe American Health Information Community. TheCommunity will provide recommendations to DHHSon how to make health records interoperable andassure that the privacy and security of those recordsare protected. Natural disasters, such as recenthurricanes Katrina and Rita, raise the requirement forinteroperability of HIT to allow the transition froma paper-based approach to an electronic one; that is,one that allows for “better care at lower cost, fewermedical mistakes, and less hassle.”2Health Policy Institute of OhioB. The Case for Change:America’s Health Care CrisisTo understand HIT’s potential for transforming ourhealth care system, consider the following: U.S.health care spending rose 7.7 percent to 1.68 trillionin 2003, and the Centers for Medicare and MedicaidServices (CMS) reports that domestic health carespending in 2004 totaled about 1.8 trillion, and willcontinue to grow faster than the economy.3-4 In 2011,the first group of baby boomers will reach the age of65, marking the beginning of 77 million baby boomersapproaching a time when they will consume a largeportion of our health care resources.5The crisis is already impacting the nature andcomposition of the health care provider workforce.Escalating insurance premiums due to malpracticerates, as well as the increasing challenges of an overlycomplex health care system are causing many cliniciansto leave medical practice altogether. The United Statesis in the midst of a nursing shortage that is expectedto intensify. According to the U.S. Bureau of LaborStatistics, more than one million new and replacementnurses will be needed by 2012.6 In a July 2002 reportby the Health Resources and Services Administration(HRSA), thirty states were estimated to have shortagesof registered nurses in the year 2000. The shortage isprojected to worsen over the next two decades with 44states, plus the District of Columbia, expected to haveregistered nurse shortages by the year 2020.7Access problems, already made difficult by thecomplexity of the health care system, are furthercomplicated for those lacking appropriate health carecoverage. Today, 15.8 percent of the U.S. population5

is uninsured,8 leaving close to 44 million Americanswithout financial coverage for major medicalemergencies and/or access to needed medical care onan ongoing basis.Concern about medical errors is prevalent. Studiessponsored by the Agency for Healthcare ResearchQuality (AHRQ), and reports by institutions such asthe IOM and other highly regarded organizations showpatient safety is also among the top health care systemchallenges. Adverse events occur in up to 3.7 percentof hospitalizations, with up to 13.6 percent of thosehospitalizations leading to death.9 Similar statisticsare found in the outpatient environment, where onestudy revealed that adverse drug events occur in 5to 18 percent of ambulatory patients.10 Forty-sevenpercent of patients surveyed in 2000 by AHRQ and theKaiser Family Foundation said they were concernedabout experiencing a medical error. Further, a 2001Robert Wood Johnson survey found that 95 percent ofdoctors, 89 percent of nurses and 82 percent of healthcare executives reported serious medical errors.While there are many opportunities to improve carethrough the use of clinical guidelines and decisionsupport, currently very few health care providersutilize the available resources. According to a 2003New England Journal of Medicine report, documentingthe appropriate treatment for 7,528 adults revealed thatAmerican adults, on average, receive only a little morethan half (54.9 percent) of the health care measuresrecommended for their conditions.11 Bringing clinicalknowledge and information about the patient to thepoint of care through HIT will help to close the gapbetween what the evidence tells us in accordancewith guidelines and treatment protocols, and thecare, interventions, and procedures that are actuallydelivered.As if these challenges are not enough, the U.S.health care delivery system is now confronted by theprospect of a public health crisis once unthinkable.Recent threats, including those related to severe acuterespiratory syndrome (SARS) and West Nile Virus, aswell as the ongoing threat of bioterrorism and naturaldisasters, underscore the vital significance of diseasesurveillance and interoperability in protecting thepublic from natural and unnatural outbreaks.Harnessing HIT for Better PatientCareToday, the United States is at an important crossroadsregarding the management and delivery of health care.The evidence is clear and compelling: the way carehas been delivered in the past does not fit the healthcare environment today. We must become moreefficient, more effective, and more creative in ourthinking. It is here that HIT holds enormous potentialfor improvement.The U.S. health care system, representing approximately 1.68 trillion or 15.3 percent of the nation’s grossdomestic product,12 is highly fragmented. Informationabounds but is stored in a variety of formats (often paperbased), leaving vital pieces of a patient’s history, forexample, inaccessible. It is widely recognized that thereare industry-wide productivity losses resulting from theinefficiencies of the system. Each health care entity,public and private—including clinicians, hospitals,insurers, and researchers—gathers and holds its owninformation, most often in paper form. In an electronicinformation age when vital data can be transferredelectronically at nearly the speed of light, only a fractionof health care data is accessed and transferred digitally.More than 90 percent of the estimated 30 billion healthcare transactions in the United States each year are stillconducted by phone, fax or mail.13The absence of readily available, comprehensive,patient-centric health information and access to clinicalknowledge negatively affects health care at every level.Research shows that physicians spend an estimated 20to 30 percent of their time searching and organizinginformation.14 Alarmingly, 10 to 81 percent of the time,physicians do not find the patient information theyneed in a paper-based medical record.15 As a result, itis estimated that 20 percent of lab and x-ray tests areduplicated because prior results are unavailable, andthat 1 in 7 hospitalizations occur because prior patientinformation is not available.16 This lack of informationundoubtedly contributes to the nearly 30 percent ofhealth care spending in the United States (up to 300billion each year) that is for treatments that may notimprove health status, may be redundant, or may beinappropriate for the patient’s condition.17An expanding body of research points to HIT’s potentialfor reducing the inefficient use of resources.18 Forexample, one study indicates that the use of ambulatory6Health Policy Institute of Ohio

electronic health records (EHRs) can produce a savingsof 78 billion to 112 billion annually.19 Such costreductions are realized because duplicative proceduresare avoided, staff productivity is increased, medicalinformation is conveyed more efficiently, and medicalclaims are processed more efficiently.Utilization of Computerized Physician Order Entry(CPOE) is another case in point. According to studyby the Center for Information Technology Leadership(CITL), full adoption of CPOE in the ambulatory settingcan generate an annual savings of 44 billion in reducedmedication, radiology, laboratory, and hospitalizationexpenditures.20 Another CITL study indicates thatstandardized health care information exchange amonghealth care IT systems could deliver national savingsof 86.8 billion annually after full implementation andcould result in significant direct financial benefits forproviders and other stakeholders.21The CITL CPOE data also showed that more thantwo million adverse drug events and 190,000hospitalizations per year could be prevented usingIT.22 Similarly, evidence from a Brigham & Women’sHospital study concluded that use of CPOE couldreduce error rates by 55 percent, from 10.7 to 4.9per 1,000 patient days.23 Yet another study, this oneconducted by Kaiser Permanente, found that whenphysicians used a CPOE system in treating intensivecare patients, incidents of allergic drug reactions andexcessive drug dosages dropped by 75 percent. Thestudy also showed that the average time spent in theintensive care unit dropped from 4.9 days to 2.7 days,reducing costs by 25 percent.24There has been a large amount of research focused on thebenefits of HIT. However, cost models for HIT use andimplementation for both regional and national healthHealth Policy Institute of Ohioinformation networks have been lacking. Recently, aNational Health Information Network (NHIN) report(authored by an expert panel of nationally renownedhealth care experts) gives important insight into broadfunctionality and interoperability costs. This study,published in the Annals of Internal Medicine, reportedthat achieving an NHIN would cost 156 billion incapital investment over 5 years and 48 billion inannual operating costs.25 It is particularly importantbecause it is the first study of its kind to break downNHIN costs into the subcategories of capital costs,functionalities, and interoperability. In addition, itoffers tangible numbers on the capital, operating andinteroperability costs that accrue to each health carestakeholder. Report findings will inform the evolvingfederal debate on financing and incentives and cost/benefit models. It also suggests that the debate overHIT legislation and funding must reach a new level ofsophistication to be relevant.Health Care IT Investment: PlayingCatch-upDespite evidence that IT improves the quality, safetyand efficiency of patient care, the health care industrylags far behind other industries in IT investments.For example, while IT investment claimed 6.5 to11.1 percent of revenues in the consumer services,insurance and financial industries in 2002, only 2.2percent of health care industry revenues were spent oninformation technology in the same year. However,HIT expenditures are expected to grow over the nextseveral years. Growth estimates vary from 5 to 18percent per year.26The low adoption rates are also seen in planned healthcare spending. For example, 40 percent of health careorganizations surveyed planned to spend 1.5 percentor less of their total operating budgets on IT, and 36percent set spending at 2 to 4 percent.27 In comparison,the average IT investment for other industries is 8.5percent.28 On the individual practitioner level, only5 to 10 percent of physicians use electronic medicalrecords in their practices. A similar finding emergesfrom studies about use of electronic prescriptions.Here the research shows that less than 5 percentof U.S. physicians currently “write” prescriptionselectronically.297

At the facility level, while 13 to 15 percent of hospitalshave implemented some form of CPOE, physiciansin the organizations entered less than 25 percent oftheir orders using the system.30 Here, however, someprogress is being made. According to a recent surveyby the American Hospital Association (AHA), majorhealth providers are beginning to make significantinvestments in EHR. AHA’s 2004 survey found thatin 2004, 64 percent of hospitals had a patient’s currentmedical record (observations, orders, progress notes)—one of the four components of an EHR—comparedwith 24 percent in 2000.C. Strategies Underway toAddress Barriers to HealthInformation Technology AdoptionNational health care leaders in both the public andprivate sectors are beginning to tackle a number ofbarriers to HIT adoption. Those barriers include thelack of standards necessary to create interoperablesystems; the organizational and clinical process changerequired in provider institutions and clinician offices;and the lack of financial incentives for HIT.StandardsStandards play a critical role in achieving interoperabilityacross siloed electronic applications within our healthcare system. Public-private sector collaboratives suchas the Markle Foundation’s Connecting for HealthInitiative and federal agency-led initiatives such asthe Consolidated Health Informatics initiative havemade considerable progress in developing consensusand driving the adoption of such standards. To furtherstandards adoption, Health and Human ServicesSecretary Mike Leavitt announced the formation of anational collaboration, the American Health InformationCommunity (AHIC), which will help nationwidetransition to electronic health records – including commonstandards and interoperability. Additionally, some of thenation’s larger public and private sector purchasers arebeginning to build requirements for standards into theirincentive programs and contracts. Also, private sectororganizations such as the Certification Commissionfor Healthcare Information Technology have emergedto begin development of processes for certification ofproducts by such standards.8Organizational/Clinical ProcessChangeA number of initiatives are now underway that aredesigned to support the level of organizational andclinical process change required to migrate to electronicsystems. The draft “Eighth Scope of Work (SOW)”provides funding through the Centers for Medicareand Medicaid Services (CMS) to quality improvementorganizations (QIOs) and includes components thatrequire QIOs to provide technical assistance to smallphysician practices as they begin adopting electronichealth records and other clinical systems. The Agencyfor Healthcare Research and Quality’s NationalResource Center for Health Information Technology(NRCHIT) will play a critical role in not only helpingits grantees and contract recipients implement HIT, butalso in serving as a resource to other stakeholders whowill be making the migration to electronic health caresystems over the next several years.FinancingThe issue of financing is probably the largest barrier toHIT adoption in the United States. The current healthcare financing system fails to provide incentives forpayers and providers to work together in creatingadministrative and clinical efficiencies or promotingthe quality of care.31 While providers now bear most ofHIT implementation costs, many of the benefits fromHIT investment in both quality and efficiency accrueto the payer, not the provider. In fact, one study showsthat providers retain only 11 percent of the benefit.Health Policy Institute of Ohio

For example, improved disease management thatreduces the total cost of care and improves healthoutcomes actually may represent a loss of revenue toproviders, who experience reduced visits or admissions.Thus, there is a misalignment of incentives amongthose who pay to implement HIT (providers) and thosewho stand to benefit financially (payers). 32In addition to changes in the payment system, thereis a need for upfront funding for many institutionsand clinicians. Many vital health care informationtechnology systems are capital-intensive, but bothhospitals and physician groups generally lacksubstantial capital or sufficient positive cash flow tofinance large investments. A number of programsare now underway to clear financial barriers. Suchprograms are described in further detail in the section“Leadership Within the Private Sector” of this report.D. The Role of Federal and StateGovernmentThe AdministrationSeveral federal agency initiatives across a broad rangeof departments are now underway to accelerate thedevelopment and adoption of both HIT and HIE. Inaddition to the extensive work now being conductedwithin the Department of Health and Human Services,other departments and agencies such as the Departmentof Defense, the Department of Veterans Affairs, andthe Office of Personnel Management are involved.1. Department of Health and Human Services –The Office of the National Coordinator for HealthInformation Technology (ONCHIT) and AmericanHealth Information Community (AHIC)The appointment of David J. Brailer, M.D., Ph.D.,as National Coordinator for Health InformationTechnology, has provided coordination and leadershipwithin the federal government to accomplish PresidentBush’s goal of providing a majority of Americanswith an electronic medical record within 10 years. InJuly 2004, Dr. Brailer unveiled the Framework forStrategic Action,33 a ten-year initiative to promote thedevelopment and implementation of HIT.Health Policy Institute of OhioThe Framework described four objectives:1) To inform clinical practice through incentivizinginvestment in and adoption of EHRs, including inrural and underserved areas;2) To interconnect clinicians through the dev

Ohio Health Care Priorities; Forum for Policy Discussion of Ohio Health Information Technology Needs; Benefits of HIE Implementation; D. Responses to Survey by Segment .20 Hospitals (including Academic Medical Centers); Physicians and Health Centers; Employers and Health Plans; Information Technology; Consumer Groups

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