5 reasons HIEs are critical to the success of ACOs

By Michelle McNickle
01:49 PM

For hospitals looking to transform into accountable care organizations (ACOs), the transition can be overwhelming. So much so, said Brent Dover, president at HIE technology company Medicity, that it's basically like becoming a mini insurance company.

"And they need to do it overnight -- it's kind of a scary and daunting thing," he said. "Right now, hospitals and doctors are paid on a fee-for-service model, and a fundamental element of an ACO is saying 'we're not going to pay you on that model anymore. We're going to pay you to take care of the overall health of this population. The more proactive you are, and the better quality you deliver, we will share that savings with you."

"And so, I don't care how you swipe it, but in essence, you're asking hospitals and doctors to take on risk and share in that risk," Dover continued. "And if they need to do a good job of managing that risk and paying for that risk. It sounds a lot to me like they're being asked to become truly managed care organizations, or more like health insurance companies."

With that said, Dover and Jared Crapo, chief of staff at Medicity, outline five reasons HIEs are critical to the success of ACOs.

1. The financial model of an ACO is incenting people to want to know what's going on. Essentially, a fundamental aspect of an ACO is "a doctor needing to know what's going on in a hospital, and a hospital needing to know what's going on with a doctor," said Dover. In turn, the financial model of the ACO is requiring people to know what's happening with patients at a "computer level," so doctors can scan patients and pinpoint who may need interventional care. "You really can't get to an ACO unless you have the capabilities that an HIE provides," said Dover. "It's a foundational element. There's no way for you to identify those patients unless you know all of the clinical data happening to them at the different points of care."

[See also: HIE market still a little like the 'Wild West'.]

2. HIEs connect the referral pattern from physicians to a hospital or service center. "I've had many CIOs across the country say to me, 'You know Brent, before ACOs, HIEs were a really nice idea; they were a better and more efficient way of distributing results and sharing data in our communities," said Dover. But along the way, he continued, HIEs established themselves as a "more aggressive way" of connecting the referral pattern from physicians to hospitals or service centers. "Now they say, 'we save costs by getting results serviced out better, and we increase revenue by having a good physician affinity strategy, and that's how we justified our investment in HIE." Add in many organizations now being faced with transitioning to an ACO, Dover continued, and an HIE has suddenly become a key business necessity. "If they didn't have an HIE in place, they'd have no way of beginning to even understand how to manage the risk. And so, health information exchange has gone from a nice thing to have to reduce costs to a business imperative and a foundational element."

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3. Hospitals can't make the business transformation to an ACO without an HIE. A few years ago, said Crapo, organizations bought HIEs to improve the efficiency of their operation. "They thought 'if we can do things for a cheaper cost, that's going to save us a little money," he said. "There was a physician affinity strategy, where they needed to provide all the physicians in their community with access to data, so they will continue to do business within the hospital." Now, he continued, if a health system wants to become an ACO, they simply can't make the business transformation without first implementing an HIE. "And if they have one, it's probably going to need to be polished up and do more things than it's doing today," Crapo said. "And if they don't have one, they're absolutely going to have to deploy one because they can't be a successful ACO without a robust health information exchange."

[See also: ACOs Part III: patient-centered IT .]

4.  It's critical to think "broad enough" when it comes to physicians. According to Crapo, when thinking about HIEs, CIOs tend to refer to their "more closely aligned" physicians, or those who may be employed or are affiliates of the organization. "But, I think they need to broaden their horizon a bit from their traditional thinking," he said. "Because for an ACO to be successful, you need to have a very broad community of specialists and expertise that are part of your provider network to deliver the access and quality of care an ACO needs to deliver." Not to mention, Crapo continued, CIOs are going to have a broad mix of technology employed in their ACO, as well as physicians who will all need to be connected. "CIOs haven't thought about how they're going to do that," he said. "So, if I was to give advice to a CIO, I would say to make sure you think broad enough about all the physicians and all the other kinds of entities."

5. Essentially, an HIE is a "necessary foundation." At the end of the day, said Dover, it's simple -- perspective changes, and an organization is at risk. "And underlying all of this is the business model," he said. "The other thing I would offer as a suggestion is, HIE is a foundational element, and it's a necessary foundation -- it's like building streets in a city." But an HIE, in and of itself, isn't enough to run an ACO, Dover added. An organization would need to tightly integrate an HIE with population health management solutions, case management solutions, disease management solutions, quality reporting solutions, and more. "So once you have that data flowing, you now need some very powerful intelligence engines that are running on top of that to start identifying at-risk patients," he said. "CIOs are facing that choice of 'Do I go out and buy HIE from one vendor and [these solutions] from another, or do I have an HIE from a vendor who has access in their company to those other layers of intelligence?' That's going to be required for an ACO."