Creating a health information exchange that serves as an independent medical record repository for the majority of California's residents has tremendous potential for payers, providers, and patients.
David Watson is seeking to capitalize on a golden opportunity in The Golden State.
David Watson |
The University of Southern California graduate is CEO of Cal INDEX, one of the most ambitious health information exchange initiative's in the country. A pair of major payers formed the non-profit HIE in August 2014, with Blue Shield of California and Anthem Blue Cross committing $80 million in seed money to help launch the not-for-profit organization.
In a recent interview, Watson told me how Cal INDEX is building a wealth of healthcare information on the foundation of 9 million records drawn from the HIE's BlueCross BlueShield benefactors.
HLM: How is Cal INDEX is leveraging access to a large set of payer data?
Watson: Most HIEs in the United States started out from the provider perspective. The design of Cal INDEX is much different. It is designed to support both payers and providers, which is a pretty big step. I lived the experience of combining that data when I worked at Kaiser-Permanente. It's a huge step up in terms of value proposition.
[Our BlueCross BlueShield founders] already understand payer data. They want clinical data so they can partner with their providers. Prescription drugs are a simple example of how providers can benefit from Cal INDEX. The payers have the data on where and when prescriptions have been filled… [so] providers can see not only what they prescribed, but also a patient history to see whether the patient is taking the medicine.
HLM: What are the challenges of starting an HIE with a large set of payer data?
Watson: There's really no challenge associated with that. The payers are pretty good at how they manage their data. The challenge is convergence—how to blend payer data well with provider data, which can be different from organization to organization…
When we receive provider data, we have to do data mapping and convert it into standardized codes. It's a little bit of a "one-off" for every health system we touch. That's our challenge. But it's also part of our value proposition. Others don't have to deal with all that mapping and data verification.
HLM: How is Cal INDEX encouraging providers to contribute data to the HIE?
Watson: We're in the stage where we're doing outreach with the providers. In order to participate in our HIE, we follow the philosophy of "to give to get." The providers very much want to have access to the data the payers have to help achieve better results in areas such as medication compliance.
They want to join Cal INDEX to leverage that data… I thought I would have to do more convincing, but providers are reacting to the need for greater access to data. Medicare just announced a goal to have at least 50% of its payments in value-based models, and commercial health plans are adopting value-based payments, too. That signal has been sent and received. Now, the concern among providers is, "Can I get there fast enough?"
HLM: What areas has Cal INDEX targeted for data sharing? In what ways do you hope it will boost care coordination and generate cost efficiencies?
Watson: In California, the main goal seems to be sharing the data so payers and providers can focus on chronic disease populations. They want to increase quality of care and care coordination, and avoid acute episodes that result in hospitalization.
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HLM: How secure is the Cal INDEX data?
Watson: Our design points are built around the best data security possible. It's one of the things that keeps me up at night because the security of the data is at the heart of my business. The data is encrypted at all steps… We invest a lot of time and energy and money to secure our data. It's just woven into the fabric of who we are.
HLM: How important is scale for an HIE to achieve success?
Watson: Smaller HIEs simply do not achieve the mass to reach a sustainable revenue model. Some of the early efforts at HIE were self-limiting. We're going to flirt with the other end of that scale. There are more than 35 million Californians. If we can approach that size, I can bring [a wide range of] data to bear, including imaging data and registries.
That extends the value proposition. That piece is untested, but we will test it with the payers and providers to see what kinds of new data will add value to Cal INDEX. Basically, size matters… The more things you want to do, the more important scale becomes.
HLM: What is your biggest challenge?
Watson: While technology can be challenging, the biggest challenges are never technical in my experience. In our case, the biggest challenge has been the legal and regulatory environment. State and federal legislation such as HIPAA never contemplated the sharing models that payers and providers are now using to support care coordination and risk-revenue sharing models such as ACOs, nor did they account for organizations such as HIEs that facilitate the otherwise appropriate sharing of healthcare information.
As a result, financial, operational, and legal issues abound that complicate the provision of services and make them more expensive.
HLM: What has been your biggest success as a startup organization?
Watson: At this early stage in our development, our biggest success is that we've hired an amazing initial team that is committed to our vision of completing the system of care in California. If you gauge success as the right people doing the right things to get to the right result, we've got No. 1, we're working on No. 2, and the market will answer No. 3 in due time.
Christopher Cheney is the CMO editor at HealthLeaders.