Bernstein by shuifanglj


									                        Regional Health Information
                        Organizations: Business,
                        Organizational and Legal Issues

                             AHRQ Annual Meeting
                                June 9, 2005

manatt                                             William S. Bernstein, Esq.
                                                   (212) 830-7282
manatt | phelps | phillips
Table of Contents

 Realities
 RHIOs: Emerging Policy Issues
 RHIOs: Emerging Business Plans
 Emerging Models for Advancing HIT/HIE
 RHIOs: Financing, Formation and
 RHIOs: Lessons From The Field
 Framework for Strategic Action Issued but
  Federal Agenda Still Emerging
    NHIN: Waiting to hear federal response to
    RHIOs: Still nascent concept with great variation as
     to mission, goals and technology plans
        “If you have seen one RHIO, you have seen one

 Funding Sources are Scarce, Especially for
  Early Development Stage, But Some Notable
 Big Question: Whether Potential Benefits of
  HIT/HIE Can Overcome Competing Agendas
  and Priorities
RHIOs: Emerging Policy Issues

 No Federal guidelines at this point, but
  likely to emerge in the next several
  months; field will evolve over time
 Federal definition of RHIOs like to focus
  on four areas
   Public Trust
   “Harmonization” of State/Local Privacy Issues
   Security
   Aligned Financial Incentives

RHIOs: Emerging Policy Issues

 Key issues to be defined with respect to
     Geographic coverage
     Requirements regarding numbers of
      stakeholders/definition of “community” project
     Relationship to National Health Information
      Network (“NHIN”)
     Tax status of an entity
     Availability of Federal funding
     Certification/Accreditation
     Requirements in Federal Contracts
     State role in defining RHIOs

RHIOs: Emerging Policy Issues

 Federal role likely to be permissive
  encouraging innovation in marketplace,
  while seeking to promote federal goal
  of interoperability through National
  Health Information Network

                        RHIOs: Emerging Business Plans
                              Regional Health Information Organization
                        RHIOs are regional entities which support the development,
                                implementation and application of secure
                                       health information exchange

                            Regulatory     Information       Clinical                                       Consumer
            Financing                                                                      Public
                             Decisions     Technology        Process       Incentives
                                                                                          Relations        Participation
                           •Privacy and                    Improvement
          • Capital
                                           •Development    •Clinical     •Performance    •Marketing Strategy   •Patient
                                           •Operations      Guidelines    goals          •Communication         advocacy
                                             • Security    •Operations   •Incentive       Plan                 •Patient
                                             •Training       • Implement structure       •Website               involvement
                           •Core data set
                                             • Support       • Training  •Coordination    management            strategies
                                             •NHIN           • Support    of payers      •Media management
                                              Compliance                  and            •Performance
                           •Data use rules
                                                                          employers       publication

Source: HealthAlliant
                                             Potential Outsource                                                   7
                                                Partners exist
RHIOs: Emerging Business Plans

 CareSpark (Tennessee)
 Indiana
 Massachusetts

What Is CareSpark?

 CareSpark is a not for profit organization
  commit committed to better health in the
  central Appalachian region through
  collaboration, innovation, and wise use of
  health information
   10 year history of health improvement projects
   Regional leaders concluded major improvements require
    regional health information exchange (HIE)
   2 ½ years on current project; $600,000 raised in 9
   Filed for 501c3 not for profit status

CareSpark Tactical Plan

 To address health issues, we propose
  to provide technical capability and
  encourage clinical process
  improvement in the following areas:
   Prescription Medication
   Diagnostic (lab, imaging) Services
   Preventive Medicine (immunizations / screenings)
   Chronic disease management

                      Indiana Health Information Exchange
                                                                                        Data access
                            Data management                                               and use
                                                                                              •   Results delivery
                                                                                              •   Secure document transfer
                                                                                              •   Shared EMR
                                                                         Hospitals            •   Credentialing
                                                    Payers                                    •   Eligibility checking

                          Hospital                                                            •   Results delivery
                                                                                              •   Secure document transfer
                                                                        Physicians            •   Shared EMR
                                      Information                                             •   CPOE
                                       Exchange                                               •   Credentialing
                                                                                              •   Eligibility checking
                                                                                              • Results delivery

                                   Data           Server
                                repository      applications                                  • Surveillance
Outpatient RX                                                             Public              • Reportable conditions
                                                                          health              • Results delivery

                                                                                      Payer   • Secure document transfer

       Physician office
                                                                                              • De-identified, longitudinal clinical
                             Ambulatory centers                                                 data
                                                        Public health   Researchers

 Source: IHIE                                                                                                             12
                 Massachusetts: Pilot Project
                 in 3 Communities
                        ICCC                                 • Joint oversight and decision-
                                           Management &        making bodies
                                            coordination     • Structure, composition,
           PSC          PSC          PSC

                                                             • Quality measurement
                    • Quality                Evaluation/
                                                             • Pilot evaluation
                    • Cost                 transformation
                    • Productivity                           • Transformation models
                    • Etc.

                                                             • Clinical access to data
                   connectivity             Connectivity     • Data gathering and
                                                             • Communication

                                              Clinical IT    •   Hardware/software
                                           implementation/   •   Implementation/tech support
                                               support       •   Systems integration
                                                             •   Workflow redesign
                                                             •   Decision support

Source: MAeHC                                                                             13
Emerging Models
for Advancing HIT/HIE

 Grassroots
 Convener
 Catalyst
 Operator

Emerging Models
for Advancing HIT/HIE

 Grassroots
   No Statewide, Coordinated Effort
   Driven entirely at local level – truly “allow a
    thousand flowers bloom”
   Examples
       Connecting for Health
       AHRQ Patient Safety and HIT Grantees

Emerging Models
for Advancing HIT/HIE

 Convener
   Essential Tasks: Educator, Convener, Information
    Clearinghouse, Researcher
   Examples
      North Carolina Health Information and
       Communications Alliance
      MAShare
      Maryland
      Florida

Emerging Models
for Advancing HIT/HIE

 Catalyst
   Essential Tasks: Facilitate financing, provide
    technical assistance and project development
    support to spawn regional initiatives
   Examples
      Under consideration in New York
      Kentucky
      Health Tech/Manatt Report: “Spending Our
       Money Wisely” Recommendations

Emerging Models
for Advancing HIT/HIE

 Operator
   Essential Tasks: Create financing vehicle and build
    infrastructure for information exchange
   Examples
       Indianapolis Regenstrief Institute
       Massachusetts eHealth Collaborative

RHIOs: Financing, Formation and
 Reviewing legal options necessitates a
  multi-faceted process involving an analysis
   The key business decisions that first need to be made in
    order to define the organization’s mission and scope
   The range of options facing the organization relative to:
      Governance Structure
      Tax Status of Legal Entity
      Terms and Conditions of Participant Agreements

                         RHIOs: Financing, Formation and

              100%                                       Medical Knowledge


                                         50% of Cost
                                        20% of Return

                                        Patient Data                         Redundancy


                                       EMR         HIE          CDS

Source: SBCCDE, CITL, Gordian Project analysis
                         RHIOs: Financing, Formation and

                                                             % of Savings Captured by

       Private Payers
       Medicaid                                              89%                        11%   Physicians

                                    Ambulatory Computer-based Physician Order Entry

Source: Center for Information Technology Leadership, 2003                                          21
                        RHIOs: Financing, Formation and

                                           Purchaser Savings

                          Enrollment Fee                       Technology

  Purchasers                                   CareSpark                      Physicians
                           Gain Sharing                        Gain Sharing

Source: HealthAlliant                                                                22
RHIOs: Financing, Formation and
 Classes of Membership -- Categories of interested
  participants (e.g., institutional providers, physicians and
  medical groups, other clinicians, managed care companies
  and insurers, local employers, public health agencies,
  public representatives) could be divided into “classes” and
  represented on the governing body by one or more
  representative members.
 Restrictive Membership -- The governing body could consist
  of a limited number of members of diverse backgrounds
  chosen because of their leadership skills and standing in the
  community, their ability to articulate the views of various
  constituencies yet rise above those interests in determining
  the future of the project, etc.

RHIOs: Financing, Formation and
 Virtual Model -- No new legal entity is formed; rather, the
  project is operated under a contractual arrangement via (a)
  a “hub-and-spoke” format (see e.g., original Santa Barbara
  design), or (b) a single agreement among the participating
  parties (see e.g., original Indianapolis design).
 Non-Profit Corporation Model -- A non-profit corporation is
  formed to be the development and/or operating company
  for the project. It could be organized to qualify as a
  501(c)(3) tax-exempt organization; or it could be a taxable
  non-profit. It could have only a governing board, or it
  could have "members" (comparable to stockholders) who
  elect the governing board and/or have the right to vote on
  certain (but not all) matters affecting the
RHIOs: Financing, Formation and
 For-Profit Corporation Model -- A for-profit corporation is
  formed to be the development and/or operating company
  for the project. The corporation would have stockholders
  (who could consist of one or more classes - representing
  different levels of "investment", with different voting
  rights), who would in turn elect the members of the board
  of directors.
 Limited Liability Company Model -- A limited liability
  company is formed to be the development and/or operating
  company for the project. The operating agreement for the
  company would provide who holds what economic interests
  in the entity and their respective rights, as well as the role
  of a governing body (if any) distinct from the equity
RHIOs: Lessons from the Field
 Importance of Leadership and Creating Shared Vision Among
  Key Stakeholders
 Organization of Project - Needs to be interdisciplinary and
       Clinical
       Legal/Organization
       Financial
       Technology
       Communications
 First step is creating strategic business plan: this will drive
  all future steps
 Structure of organizational vehicle may minimize legal
  complexity - multi-stakeholder not-for-profit structure,
  with independent decision making body, will significantly
  reduce concerns regarding fraud and abuse and antitrust
RHIOs: Lessons from the Field

 State law privacy issues may present larger hurdles to
  project than HIPAA
 Largest and most complex issues involve:
    Defining role of RHIO as compared to and in relation to role of
     stakeholders contracting with the RHIO
    Creating financing plan for the project; Think of financing as
     occurring in three stages:
        Planning
        Development
        Operations
    Note RHIO may enable financing of certain information
     technology investment by outside entities; this
     capital/operating cost will be borne by the outside entities,
     not the RHIO itself.

  “We are almost out of tricks
 here. The only thing left is to
  reduce the illness burden on
 society. Eliminating errors in
the healthcare system through
HIT is the best way to do that.”

             -Anonymous Commentator

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