Patient Safety Institute folds due to lack of funding

The outlook for the creation of a self-sustaining national health information network dimmed after a decision by the Patient Safety Institute to close its doors.

The Patient Safety Institute ceased operations last week after six years, citing a lack of investment opportunities to test its locally grown information network on a national scale.

But the institute isn't the only health information network to fold this year. Several regional information exchanges could not sustain funding despite claiming to have strong participant support, and recent closures in Portland, Ore., and Pennsylvania suggest organizations haven't yet proved to the healthcare industry the need for everyone to be able to exchange data.

A sustainable business model is necessary if the healthcare industry wants to move forward with improvement—something that has been difficult to prove for physicians, said Bill Hersh, professor and chairman of the department of medical informatics and clinical epidemiology at the Oregon Health & Science University, Portland. "We have a poor business case for small practices to adopt electronic health records, since they pay the cost and others get the benefits. Same for the Patient Safety Institute and same for RHIOs. Those who get the benefit must be the ones who pay the cost,” he said in an e-mail.

The institute's technology was similar to that used by many other groups attempting to leverage networks, said Beth Just, president and chief executive officer of Just Associates, a consulting firm based in Centennial, Colo. Her company works with healthcare systems to implement patient-identity management across differing medical records. Through her firm, she works closely with the Colorado regional health information organization, a statewide information network initiative.

The Colorado RHIO currently is piloting its network using a five-year grant from the Agency for Healthcare Research and Quality. That grant will run out in two years, after which the RHIO will be on its own. The organization is exploring sustainability models now, Just said.

Johnny Walker, former CEO of the institute, said in an e-mail that the organization's model would have worked, but investors were cautious about the expense and unclear about a return on investment. "This is where the project broke down because we could not secure the investment" to demonstrate payer savings, he said.

The Plano, Texas-based institute estimated it would have needed more than $10 million for the national demonstration. "We didn't find it anywhere," Walker said.

It wanted to launch the information network it had developed in the Seattle area, a pilot health information network structure among 365 clinical users across three hospitals, three clinics and family practice residency programs. The network accessed the records of more than 5,300 patients and collected more than 23 million clinical data results, according to a Journal of Healthcare Information Management article analyzing the institute's model.

The technology aspect was a success, Walker said. "Everybody loved the game plan and the result. It has been continuously operational in Seattle for five years," he said.

However, much like several other healthcare information networks, the institute was unable to sustain financial support.

Despite the institute's failure, what the group tried to accomplish is critical to successful change in the healthcare industry, said Jim Conway, senior vice president of the Institute for Healthcare Improvement.

"What they were trying to accomplish is absolutely where we have to go," Conway said. The IHI promoted the 100,000 Lives Campaign to reduce the number of deaths caused by hospital-acquired infections and other errors, and is now pursuing its 5 Million Lives Campaign to reduce the incidence of medical harm caused during care.

The assumption that more use of information technology leads to increased patient safety is only the base—proving sustainability has become the next step for groups trying to connect healthcare stakeholders across the country.

Organizations that received HHS funding to work on the national health information network must study sustainable models as part of the contract terms, said W. Holt Anderson, executive director of the North Carolina Healthcare Information and Communications Alliance. The NCHICA is one of nine health information exchanges sharing $22.5 million to test implementation of a national, interconnected network.

The NCHICA also was part of the first round of HHS funding for this project in 2005, which found that large hospital systems already had developed specialized health information exchanges to communicate with their physicians and group of healthcare facilities, Anderson said. The key in this second phase is to interconnect those specialized networks so information can flow in a standardized way. The challenge is to demonstrate that interconnectivity benefits them, Anderson said. "That's the big question."

The University of Pittsburgh Medical Center has developed one of those specialized networks, something it calls a "mini-RHIO" to connect 20 hospitals and 2,000 physicians, said G. Daniel Martich, chief medical information officer and associate chief medical officer for the system.

The system has formed a partnership with a Tel Aviv-based IT firm to create its interoperable network in Pennsylvania, which it hopes it can promote to other hospital systems, Martich said. "If you can make it work here, you can make it work anywhere," he said.

The financial benefit remains an issue, however. The UPMC system along with its IT partner is starting to study where use of an information network leads to savings so it can point to that data when demonstrating the network outside the hospital system, Martich said.

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