emerging standards and the disruption of hie 1.0

Emerging Standards and the Disruption of HIE 1.0

Jitin Asnaani, ONC

Agenda

• What is HIE?

• How does HIE create value today?

• What are the emerging standards for HIE?

• How will these standards affect HIE business models?

• What does this mean for vendors?

• Perspectives – What do you think?

• Acknowledgements

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What is HIE?

• Since the 1970s patient care has accelerated away from the “one provider” model physicians live in silos

• Health information exchange (HIE) services have emerged with the aim of re-connecting physicians with their patients

• With adoption of HIE projected to accelerate in the near-term, new and incumbent vendors of HIE services are searching for viable business models: – How will value be created?

– What will customers pay for?

– What’s the best strategy to capture this value?

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Creating Value: A Different Perspective

• Traditional product management and marketing strategy focuses on “Who is the customer?”– Segmentation based on attributes– Geography, local demographics, level of urbanization, distribution of

physicians, presence of academic medical centers, etc.

• But successful entrepreneurs first ask the question “What is the customer trying to get done?”– This is how customers experience life – whether the customer is a patient,

physician, hospital, government agency, etc.– They “hire” a product to do a “job” for them

• For physicians, Health IT is about solving valuable hard jobs in patient care!*

* Physicians also have hard jobs in reimbursement – while we chose to focus on the clinical hard jobs here, the implications for HIE described in this document will similarly apply4

Creating Value through HIE:A Jobs Point of View

Clinical Job (physicians) “Help me provide safe and effective care”

Jobs for Health IT

Products “hired” for this job

Performance Basis: Today

“Help me ensure continuity of care”

“Help me store and retrieve patient clinical data”

• Filing Cabinet• Scanned Documents • EHRs with Unstructured Data• EHRs with Structured Data

“Help me diagnose this patient”

“Help me create an effective treatment plan”

• Paper Discharge Summaries• Phone / Fax• HIEs/RHIOs/HISPs• Connected EHRs

Integrated Workflows within hospital/practice:• Access across hospital units• Comprehensive set of clinical tools

Connectivity to relevant external data sources:• Raw ability to send, receive, translate• Privacy, Security, Consent mgmt.

time

time

Clinical Sub-Jobs

“Help me share and access clinical data with others”

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. . .

. . .

ONC and others are commoditizing connectivity


Jobs for Health IT








Connectivity to relevant external data sources:• Raw ability to send, receive, translate• Privacy, Security, Consent mgmt.

time

time

Clinical Sub-Jobs

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• Widespread interoperability is being driven by rule-making such as Meaningful Use, and the emergence of accountable care

• ONC and others are establishing standards for the content and transport mechanisms for exchange

• Together, this will make “connectivity” easier, cheaper, and simpler


Emerging Standards: Content

• S&I Framework:– Community of 350+ participants: HIT vendors, SDOs,

government agencies, IDNs, academic centers, physician practices, etc.

– Transitions of Care (ToC) Initiative: focused on defining a common modular set of clinical data for exchange during a care transition

– Lab Results Interfaces (LRI) Initiative: focused on standardizing lab results reporting to ambulatory primary care settings

• Numerous initiatives elsewhere across the industry to standardize public health reporting, lab orders, etc.

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Emerging Standards: Transport

• v1 of Nationwide Health Information Network: – Standardizes transport, security and queries for scalable patient and

document discovery across communities of care– Implemented by 8 substantial IDNs/Federal Agencies, with several more

onboarding over the year– Evolving models for certification and governance

• Direct Project*: – Standardizes transport and security mechanisms for secure directed

messages between healthcare participants– Commitment to implement by 50+ vendors and 25+ states

• S&I Framework: – New initiatives focused on Provider Directories and Certificate

Interoperability

* To be merged into the Nationwide Health Information Network in the near future8

What happens when functionality like “connectivity” gets commoditized?*

• A commoditized product is in “overshoot”– Functionality provided exceeds value customers can utilize– Customers not willing to pay more for added functionality on the

existing performance basis

• Disruption! – Once requirements for functionality and reliability have been met,

customers redefine what is not “good enough”– Customers become willing to pay premium prices for improved

performance along new trajectories of innovation, such as convenience or customization

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Disrupting HIE 1.0

• HIE 1.0 required fully-integrated bespoke architectures, because “connecting” was hard– As emerging standards simplify and commoditize connectivity, the nature

of firms involved in HIE changes – HIE & EHR vendors that compete on “being able to do it” will be disrupted– Commoditization will enable modular interfaces, driving down cost to

deploy basic connectivity – and consequently, low price points*

• HIE 2.0 will be all about seamless clinical workflows, regardless of where the data resides– Basis of competition shifts towards providing clinical value: seamless

clinical workflows & quality management– Good businesses are going to couple technology and service for workflow

integration and change management

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HIE 2.0: Seamless Clinical Workflows




Integrated Workflows within hospital/practice

Connectivity to relevant external data sources

time

time

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Performance Basis: Future

HIE 2.0: Seamless Clinical Workflows, regardless of where data resides

Performance Basis: Today


Jobs for Health IT





Clinical Sub-Jobs


. . .

. . .

What does this mean for EHR vendors?

EHR vendors can embrace one of two strategic paradigms:• Apple Model – integrated lifestyle/computing platform

– Provide high-performing, fully-integrated solution for health information exchange and clinical workflows

– Attract demanding/high-end customers who are willing to pay for it

• PC Model – modular components with standard interfaces– Optimize performance on key functionality, i.e., clinical workflows– Create modular interfaces to standardized or third-party plug-ins for

connectivity– Appeal to broad customer base

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What does this mean for HIE vendors?

Incumbent HIE vendors must move up-market, race to scale, or embrace disruption:• March Upmarket:

– Provide high-performing connectivity solutions that high-end/demanding customers will pay for (the Apple model again)

• Race to Scale:– Try to become super-regional or even nationwide providers of

low-margin connectivity solutions (the Utility Company model)

• Embrace Disruption – very hard:– Partnerships/M&A with the disruptors who will provide clinical

value in the future (AOL/Time Warner, Cisco/Flip, etc.)

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Your perspective

• This is our hypothesis: what’s your view?

• What do you think will be the impact of standardization?

• Where do you see HIE business models heading in the next 3-5 years?

• How will this affect hospitals, IDNs, physician practices, labs, IT vendors, and other healthcare participants?

• What role and impact will payment reform have in terms of HIE capabilities and business models?

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Acknowledgements

• This discussion utilizes theories and terminology articulated by Clayton M. Christensen and Michael E. Raynor in my academic and professional engagements with each, and described in detail in their excellent book “Innovator’s Solution”

• The storyline is built on the vision and real-world experiences first shared with me by Arien Malec, Coordinator of the Direct Project and the S&I Framework

• Much thanks to the edits and suggestions provided by ONC colleagues and contractors Brian Ahier, Erica Galvez and Sachin Jain

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Thank You!

emerging standards and the disruption of hie 1.0

Health & Medicine