The economic benefits of health information exchange interoperability for Australia

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The economic benefits of health information exchange interoperability for Australia. Australian Health Review, Sprivulis P, Walker J, Johnston D, Pan E, Adler-Milstein J, Middleton B, Bates DW. 2007 Nov; 31(4):531-9.

Question: is there is economic benefits for Australia from implementing health information exchange interoperability among health care providers and other health care stakeholders.

Purpose and Background: There has been a lot of discussions about the benefits of health information exchange either economic or non economic (quality improvement and patient safety). This paper presents a cost-benefit model for paper-based, machine transportable, machine readable and machine interpretable interoperability. This analysis suggests savings of over two billion dollars annually from implementation of health information exchange interoperability for transactions in which Australian governments have a financial interest.

Data sources: Australian Bureau of Statistics, Australian Institute of Health and Welfare, and Health Insurance Commission reports for 2002-2003. Other sources included studies conducted in Australia or other English-speaking countries.

Methodology: Four levels of sophistication and standardization of interoperability were modeled in order to assess the impact of different interoperability standards upon the costs and benefits of implementing interoperability. It was developed for Government-funded health services, and then validated by expert review.

• Level 1: Non-electronic data Minimal use of information technology to share information (Mail, telephone).

• Level 2: Machine Transmission of non-standardized transportable data information via basic information technology (Fax).

• Level 3: Machine organized Transmission of structured data messages containing non-standardized data (E-mail of free text, exchange of files in Incompatible/proprietary files formats).

• Level 4: Machine interpretable Transmission of structured data messages containing standardized and coded data (Automated exchange of coded results from external laboratories into an electronic medical record).

The costs and benefits associated with information exchange between providers, and information exchange between providers and key health care stakeholders were modeled.

Then a projection of costs and benefits was done.

Main Results: Level 3 interoperability would achieve steady-state savings of $1820 million, and Level 4 interoperability, $2990 million, comprising transactions of; laboratory $1180 million (39%); other providers, $893 million (30%); imaging centre, $680 million (23%); pharmacy, $213 million (7%) and public health, $27 million (1%). Net steady-state Level 4 benefits are projected to be $2050 million: $1710 million more than Level 3 benefits of $348 million, reflecting reduced interface costs for Level 4 interoperability due to standardization of the semantic content of Level 4 messages.

Conclusion: the authors concluded that Benefits to both providers and society will accrue from the implementation of interoperability. Standards are needed for the semantic content of clinical messages, in addition to message exchange standards, for the full benefits of interoperability to be realized. An Australian Government policy position supporting such standards is recommended.

Comments: There may be potential possibilities for bias in this study design due to the following reasons:

• Fully private medical and pharmaceutical services and third party paid services, such as workers compensation insurance, and clinical services provided by non-medical clinical providers, were not modeled.They should be modeled if we want to talk on a national level.

• The costs and benefits of improved interoperability between non-provider stakeholders (eg, laboratory to pharmacist) were not modeled.They should be modeled because interoperability between non-provider stakeholders are part of health information exchange.

• The model did not attempt to account for inflation, discounting. And they should be put in consideration.

• This model used a peer-to-peer model of information exchange with a national framework. While we can not guarantee that all Australian providers will participate in the network in order to achieve the projected benefits.

Dahlia Abd-Ellatif