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New study finds RHIOs are foundering financially

By Richard Pizzi

ORGANIZATIONS HOPING TO EXCHANGE health data within geographic regions are struggling to achieve their chief goals, and many are failing financially.

Electronic clinical data exchange is far from a reality, with few organizations facilitating such exchange and many failing in the process, concluded a study by Harvard researchers published last month on the Health Affairs Web site.

The study, based on a 2007 survey of 145 regional health information organizations, found that about 25 percent of the RHIOs are defunct, and only 20 were said to be of at least modest size and exchanging some clinical data. Of those 20, only 15 exchanged clinical data across a range of patient populations.

It's expensive to start a RHIO, especially initially, said study author Julia Adler-Milstein. Grants typically fund RHIO startup costs, but the survey found the data organizations are struggling to achieve self-sufficiency.

The survey found eight of the 20 moderate-sized RHIOs continue to depend heavily on grants. By contrast, nine never received grant funding, and some 13 RHIOs said they collected recurring subscription or transaction-based fees from participants.

 

"If we want RHIOs to attain the vision of comprehensive health information exchange, we need to increase our investments in them," Adler-Milstein said. "Otherwise, many of these RHIOs will be unable to sustain themselves under the current market-oriented approach."

The study corroborates findings from previous RHIO funding studies by the Healthcare IT Transition Group, a Tulsa, Okla.-based consulting firm, which has issued two reports in the past two years citing RHIOs' dependency on grant financing.

"It is disappointing to watch the continuing struggles that RHIOs are going through," said Michael Christopher, chief technology officer and senior development analyst for Healthcare IT Transition. "This study may help bring to light what we see as a key disconnect in the RHIO movement, namely that expectations of commercialization are premature and that public investment, whether in the form of government support or private philanthropy, are going to be required, and at greater levels than what we're seeing right now."

Financing is only one of several serious barriers to RHIOs achieving their potential, said the survey, funded by Harvard's Program for Health Systems Improvement. Electronic health data exchange between hospitals, physicians' offices, labs and other clinical settings has been elevated by many in the healthcare industry as the key to improving quality, efficiency and coordination of care.