| Health Information Organizations (HIOs) are legal entities engaged in health information exchange (HIE), or the electronic movement and sanctioned disclosure of protected health information in order to improve the quality and efficiency of care (Horowitz, Jane & Morrissey, John, 2008). Though projected to enable up to a 5% reduction in national healthcare expenditures (Walker et al., 2005), for two decades HIOs have largely struggled to demonstrate a communal business case and long-term financial viability (Pevnick et al., 2012). The challenges have been transcending stakeholder issues of trust, competition, difficulty assessing value, and misaligned financial incentives in addition to the complex issues related to technology interoperability, security and privacy (Adler-Milstein, DesRoches, & Jha, 2011; Frankel et al., 2013; Grossman et al., 2008; Kern et al., 2011; Vest, 2010). As stimulus resources wind down, policy makers and healthcare stakeholders lack robust ways to evaluate HIO value in order to establish investment strategies and set future policy directions (Adler-Milstein, Bates, & Jha, 2011; Fontaine, Ross, Zink, & Schilling, 2010).;The solution was to create a system dynamics "flight simulator" style application called Health Information Organization Simulator (HIOSIM). HIOSIM simulates the adoption of the HIE Admit Discharge and Transfer (ADT) Use Case focused on care coordination to reduce hospital readmissions. It successfully allows policy makers, hospitals, physician organizations (PO), and health plans to assess stakeholder specific payoff and to understand by stakeholder the financial consequences for multiple scenarios as readmissions and costs change compared to the status quo. The scenarios considered examined paying POs for care coordination, use of hospital penalties for excess readmissions, pervasively connecting all hospitals via HIE, and comparison of Opt In vs. Opt Out privacy policies.;HIOSIM revealed in all scenarios other than the status quo a hospital loss of revenue and an associated payer gain. The negative impact to hospitals suggests that participation in the HIE ADT Use Case may require either incentives, penalties, or mandate. The very large cost for care coordination and its significance prior to realizing any benefit from HIE underscored the need to create financial or policy levers to ensure care coordination activities exist. The necessity of reimbursement for care coordination by a critical number of payers was also highlighted. Penalties generated income for health plans, but without any corresponding financial support for care coordination the use of fines alone would not directly lead to a change from the status quo in the number of prevented readmissions. Also important was that the status quo was the only scenario where no additional new expense was required by any of the stakeholders, signifying that without external pressure little motivation to change exists. The large gains shown in HIOSIM compared to the modest costs for HIE supported a policy of investment in HIE. Opt In policies negatively affected the amount of saving, so monitoring the gap between Opt In versus Opt Out rates may become very important to best address the trade-off of privacy interests versus public financial benefit. |
