This blog has discussed the 21st Century Cures Act’s (“Cures”) prohibition against information blocking before through a legal perspective. This post will talk about what the prohibition means for one of the key stakeholder groups that it is meant to help: healthcare technology innovators. The good news is that healthcare data is getting cheaper and easier to exchange. The bad news is that integration with critical systems might get more expensive and harder.
On April 5, 2021, the prohibition against information blocking went into effect. In short, it is any practice that could materially interfere with the access, exchange or use of electronic health information (“EHI”). CEHRT vendors and healthcare providers are subject to fines up to $1 million per instance or penalties under a federal physician/hospital payment program respectively. A general theme ran through the congressional testimony that built up to the prohibition against information blocking: certified electronic health record technology (“CEHRT”) vendors and large healthcare organizations held data hostage and extracted large fees for access to codified patient data. CEHRT vendors certainly do possess the market power to engage in such behavior: the market is top heavy. For example, Berkshire Hospital Review’s recent summary of KLAS’s 2021 market analysis of the EHR market said this: “Epic now maintains nearly one-third (31 percent) of the EHR market share, followed by Cerner at 25 percent, Meditech at 16 percent and Allscripts at 5 percent.”[1]
That data is very important to innovators developing new technology because it affects how the product is built, and the extent of a product’s access to that data defines who its users could be. For example, any analytics product is really only worth the value of its algorithms. Algorithms cannot be written from nothing: they require large data sets to formulate a working sample size. With respect to defining your users, it’s important to note that the vast majority of clinical data that providers create is within CEHRT systems because providers do not usually leave those systems in their day-to-day workflows. If your product needs to be in the provider’s workflow when healthcare data is created or transmitted, you very well may need to be in that product.
So what does Cures do for innovators?
First, it makes data cheaper. The ONC has made it abundantly clear that any fee for EHI is information blocking, unless it meets the “Fees Exception.” The Fees Exception permits a CEHRT vendor to recover their actual costs incurred (subject to a couple of pages of limitations), and a “reasonable profit.” The ONC demurred on what exactly a reasonable profit might be, but I assure you, a Chief Financial Officer’s assessment of what that might be in the absence of a countervailing law would vary wildly from one by a regulator at the ONC or OIG when a countervailing law does exist. I already raised how the market is top heavy: what I should also mention is that players of that size tend to be well-ran shops that value compliance. Those firms will seek to make up their lost profits elsewhere and have likely already shifted their prices and commercial models in response to these regulations.
Second, it will make it easier, and in some cases finally possible, to exchange data between different systems. This is going to be less a product of the prohibition against information blocking and more of one stemming from updates to the ONC Health IT Certification Program. First, the ONC is prioritizing advancing standards for discrete clinical data elements and documents that must be formatted in certain ways, which in turn must also be capable of exchange through certain standards – namely Fast Healthcare Interoperability Resource Application Programming Interfaces (“FHIR APIs). That data set is called the United State Core Data for Interoperability, and you can learn more here: https://www.healthit.gov/isa/united-states-core-data-interoperability-uscdi. If you send a CEHRT system a properly standardized clinical document or data, their system has to be able to accept and consume it. Conversely, their system must also be able to produce standardized clinical or data for consumption by receiving systems. Importantly, CEHRT vendors will have to publish their implementation specifications for this data set, and its exchange standards.
Third, it may make integration into a CEHRT’s system more expensive. Cures’ prohibition against information blocking focuses on data. It does not force a CEHRT vendor to integrate your product into its own. The unfortunate reality here is that healthcare providers do not use software like office workers. They generally stay inside one application all day: their CEHRT. If your service requires you to be in the clinician’s workflow, the 21st Century Cures Act may actually drive up costs because: 1) CEHRT vendors’ CFOs will seek to recover those lost profits somewhere and third party developers are likely more attractive targets than their hospital/provider customers, and 2) the compliance obligations imposed by the ONC Health IT Certification Program and the prohibition against information blocking are significant enough that they may cause consolidation in the bottom half of the CEHRT market.
What does this mean to an innovator’s strategy? Ask what data you actually need, and what level of integration does your product need in clinical workflows.
That’s going to be based on what your product does and who you serve, and maybe even where you serve them. If you just need data, this is great news – maybe. You have to assess whether or not the data you need is covered by the regulation and meets the definition of “EHI.” There are layers to that: do you need EHI, non-EHI, how much of each, and how intermingled are they? Another important question is how close to the healthcare provider’s workflow your product really needs to be to address its intended use cases. The closer, the more expensive the endeavor will be because you will essentially be burdened with a partnered product, and your partner very well may have monopolistic tendencies that leave you at its mercy. Finally, who you hire matters because healthcare interoperability is hard. No matter what, you need people who understand healthcare and its data.
[1] Jackie Drees, Berkshire Hospital Review, EHR market share 2021: 10 things to know about major players Epic, Cerner, Meditech & Allscripts, available at https://www.beckershospitalreview.com/ehrs/ehr-market-share-2021-10-things-to-know-about-major-players-epic-cerner-meditech-allscripts.html (May 21, 2021).
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