California Insurers Want to Build a Huge Data Exchange … Will Providers Come?

Two of California’s largest insurers are trying to build one of the country’s most comprehensive health information exchanges, but they’re facing reluctance from providers who are hesitant to share their data.

Anthem Blue Cross and Blue Shield of California—the second- and third-largest insurers in the state, respectively, after Kaiser Permanente — teamed up in 2014to establish Cal Index. Their goal is to create a complete, longitudinal health record for every California resident.

But they still need the buy-in from health systems, which must be willing to share their data and pay a fee to access data from others. Cal Index currently has payer records on 9 million people, covering three years of claims data. The data does not include prices.

Only one health system—San Francisco-based Dignity Health—has so far agreed to join the exchange and will go live at the end of this month. Cal Index is in discussions with a handful of other systems and hopes they’ll soon sign contracts as well, said David Watson, the group’s Emeryville, Calif.-based CEO. Kaiser, the state’s largest health plan, is not among that initial group.

Notably, Kaiser was one of the many providers and EHR developers that pledged earlier this week to make it easier for patients and healthcare organizations to access and share data. It’s part of an overall push by the government to obtain the elusive interoperability of EHRs.

Kaiser said in a statement that it participates in all regional, state and national HIEs that are using HHS’ national standards.

“Cal Index could join the nationwide eHealth Exchange, sign the federal data use and reciprocal support agreement like Kaiser Permanente and other state exchanges have done,” the Oakland, Calif.-based system said. “By doing so they would commit to strong security and privacy provisions and the use of national standards which would enable them to exchange data with KP and many more providers than they have so far sold their service.”

“We’ve been doing outreach to payers and providers since midyear last year,” Watson said. “But our challenge is that we’re not closing on providers as quickly as we wanted to.”

Cal Index is trying to simplify its pricing structure to a single fee-based model, rather than a per member, per year fee. But Watson acknowledged that, in trying to simplify the cost, some small or rural hospitals might find that pricing structure cost-prohibitive. “The bigger hospital-based health systems have a more straightforward value proposition,” he said.

Cal Index also is amending the terms of its contract to prevent data from being used for contracting or promotional purposes. Getting providers to trust that payers will use their data appropriately has been one of the biggest concerns Cal Index has faced, Watson said.

The business case for payers is fairly straightforward: They hope to reduce medical expenses by 2% to 3%. That savings could come, for example, by reducing duplicate laboratory and imaging tests when a patient transfers care to another hospital.

Yet any provider taking on risk for a population of patients would have the ability to use the data to calculate more exact risk scores; they’ll have a patient’s entire medical history in front of them—even if that patient has previously been treated elsewhere.

“It helps them with the reimbursement and being more appropriate with the reimbursement,” Watson said.

California’s privately funded, multi-payer exchange is unique compared to other state efforts. New York comes closest with its publicly funded health information exchange. North Carolina may also soon pass legislation that will mandate an information repository for its Medicaid population.

The exchange will include sophisticated analytical tools, including Apache Cassandra, a data management system that stores cloud-based data and can handle real-time datasets. Cal Index is also using tools such as Spark and Elasticso that data analysis can be performed at “Google-like speeds,” as soon as new data is entered, said David Bennett, executive vice president of product and strategy at Orion Health.

Orion Health is working with Cal Index on the technology component of the platform.

“It’s supporting what you can do today as well as what you can do tomorrow,” Bennett said.

Orion and Cal Index gave a presentation about the project at the Healthcare Information and Management Systems Society convention in Las Vegas Tuesday.

Health systems and insurers are currently limited to their own data when they want perform analyses.

“That’s not a way to rapidly scale and change the healthcare delivery system,” said Blue Shield CEO Paul Markovich. “If you can create this integrated data exchange on an open source platform, the platform becomes a bit like the iPhone is for apps. Now you have the potential for innovations coming from Silicon Valley and other places.”

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