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Doing it Right

September 1, 2007
by Daphne Lawrence
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While the key to the perfect RHIO may still be a mystery, a number of them are off and running

Jeff Rose

Jeff Rose

In any new endeavor, there will be brave pioneers. Today, after many false starts, experimentation and expensive crashes, approximately 15 trailblazing RHIOs are fully operational. Their best practices are the roadmaps for the rest of the country.

In what may come as comforting news to those in the RHIO trenches, there is commonality among the successful. Jeff Rose, CEO of HealhAlliant, a Piedmont, Calif.- based RHIO consulting group, believes a clear vision and specific business plan are necessary elements.

Lamott DuPont

Lamott DuPont

"The CHINs (community health information network) of the ′90s largely failed, in my opinion, in that they were focused on the technology, not what they wanted to do with the technology," he says. "I don't think IT alone solves much of anything."

In addition to an IT infrastructure including hardware and software, he says changes are needed in implementation, support, culture, and payment plans, all of which have to be synchronized to a long-term goal or vision. "That can be daunting to most RHIO projects," says Rose. "It's very hard for them to get their head out of the mud and think about building a bridge over the swamp."

True objectives, though, must be deeper than mere slogans. "Quality, safety and efficiency is the RHIO mantra, and it is little more than pablum," says Rose. "They're not sufficient to motivate people or raise money for IT and staff."

He believes the business plan has to express the financial ramifications of the overall project in order to justify the expenditure of capital. In Cincinnati and Indianapolis, for example, savings were identified in reducing the cost of distributing reports. In Boston and Utah, the initial objective was reducing the cost of administrative activities.

Securing funding in the near and long term are closely tied to a clear business objective—and critical to a RHIO's success. Case in point: the Pennsylvania RHIO, established in July 2006, was working to obtain not-for-profit status with the IRS, but couldn't afford the estimated $26,000 to achieve that designation—and funding promised by supporters was not delivered. The RHIO was dissolved this July.

Success stories

THINC (Taconic Health Information Network and Community) in upstate New York, operating as a RHIO since 2002, developed a business model for success. "We had a twin philosophy of improving care, but also a rigorous and vigilant focus on providing value to the stakeholders—the physicians, hospitals and labs," says Lamott DuPont, executive director of THINC.

The RHIO's business proposition? Reducing costs for delivering lab results and other clinical data. It's not an easy sell and it's a constant challenge, DuPont says, because the RHIO's business the delivery of value always comes at a cost. "The business proposition needs to be keenly articulated at each step of the way," he cautions.

The Santa Cruz (California) RHIO, (established in 1997) had the business objective of reducing waste and improving patient care by delivering clinical documents faster. "Whenever you can get the right information to the right user as quickly as possible, a natural outcome is to improve patient care," says Bill Beighe, CIO of the RHIO.

The Santa Cruz RHIO, used by 80 percent of the providers in the county, has lowered its cost for delivering an endoscopy report from $4 to less than 50 cents. Primary funding comes from its IPA, with contributions from two hospitals, four labs and the Santa Cruz Department of Health.

One RHIO still in the demonstration phase also believes in the value of a strong business plan. The Maine RHIO is focusing on clinical exchange to reduce the frequency of duplicate testing—to the tune of $40-60 million a year. "Our business plan also identified key starting services and a structure for securing money, both in the near and long term," says Devore Cutler, executive director for Maine's HealthInfoNet.

That RHIO's $3 million raised so far came from a cross section of sources—the private sector, provider community, grants, state government and the state legislature. "My two year demo phase will cost $6 million. A fairly common theme among RHIOs is that securing the startup money is a challenge," Cutler says.

Clearing the way

Reducing the barriers for users is another best practice of successful RHIOs—both financially and technically. Fees can be high—purchasing hardware, software and maintaining license fees. Add to that the cost of the maintaining the infrastructure that supports the exchange and training.

DuPont of THINC agrees the biggest ongoing challenge is financing. "What we've tried to do is recognize each of those components and try to reduce the cost so physicians' offices can take that leap of faith. These are all just tools to improve efficiency. We want to make them as cheaply and easily available as possible."

THINC used a $5 million grant from the state of New York to purchase 1,000 EHR licenses. "Grant money supports and reduces the software costs. We're going to give it away so physicians won't have to pay the $6,000 for the license," says DuPont. THINC is using the payers to subsidize maintenance fees and connectivity charges, and the labs and hospitals pay to maintain the infrastructure.