After 2 Years of Cal eConnect, What’s Next for HIE in California?

The first thing to understand, according to Cal eConnect board member Don Crane, is that the work is the most important thing.

Over the two years that Cal eConnect has been operating, “We created an improved climate for health information exchange in California,” he said. “Programmatically, we’re pretty good. But clearly the management picture hasn’t settled the way we’d like, and that’s been frustrating.”

The clouded management picture started with the abrupt departure of the organization’s first CEO Carladenise Edwards. She left in August 2011, after about 14 months on the job. A long search for a new leader followed. In March, Cal eConnect announced it had found a new CEO, but about two weeks after agreeing to take the job, Ted Kremer, who ran a regional health information exchange in Rochester, N.Y., changed his mind and withdrew.

That left the 22-member board of directors in a tough spot, Crane said.

“Every single board member had the same thought,” Crane said. “What’s the best way to advance HIE in California? We’re looking at it, knowing we have 19 months left on the clock [before health care reform launches in January 2014]. So I think that was kind of a selfless act on the part of the board, to turn over the programmatic work to an organization that could really get the work done faster.”

On May 11, the board for Cal eConnect voted to end its grant agreement with the state.

A new agreemment is being forged between the state and the Institute for Population Health Improvement at UC-Davis. The institute is headed by Ken Kizer, a key figure in the Department of Veterans Affairs’ highly successful HIE effort. Kizer also was director of California’s Department of Health Services in the late ’80s and early ’90s (the agency later became the Department of Health Care Services).

‘Best Position for Success’

Cal e Connect board members hope the institute is small enough to make quick decisions and adapt and respond to needed changes. “They feel sort of lean and mean,” Crane said.

“What mostly occurred is the recognition that a big board wasn’t optimum for the programmatic work,” Crane said, “and the board is large. We weren’t moving as fast as people wanted, so we felt this would be a better way to go, to put Cal eConnect in the best position for success.”

Some members of the board likely will remain involved in an advisory capacity, according to Pamela Lane, deputy secretary of California’s health information exchange. And the work of Cal eConnect won’t change at all, she said.

“Relative to programmatic changes, the whole purpose of the hand-off of programmatic work is to not change the direction of the programmatic work,” Lane said. “These are brilliant people over there, and we don’t want to lose that momentum.”

The main change, she said, will be in administration of the grant. Much of the staff is expected to switch over to the new program. It’s too early to know, she said, whether the name “Cal eConnect” will remain or if a new name will be chosen.

“Part of the challenge has been having the organizational structure to make the program work,” Lane said. “All of us watching would have hoped it didn’t go that way. But change is an opportunity. … The board saw it as an opportunity to advance HIE, the Institute sees it as an opportunity, I think the stakeholders will see it that way, too.”

According to officials at the federal Office of the National Coordinator for Health Information Technology, the $38 million grant relationship between the federal program and California’s Health and Human Services agency remains the same. The sub-award to Cal eConnect will need to be renegotiated with IPHI. One federal official said ONC “is very supportive of the decisions that are being made.”

Trust Building

The key to success for Cal eConnect is trust, according to Jonah Frohlich, who was the state’s deputy secretary of Health and Human Services for Information Technology when Cal eConnect was launched two years ago. (He currently is managing director of Manatt Health Solutions.)

“The trust fabric is of paramount importance. It is the single biggest issue for this type of exchange,” Frohlich said. “You have to maximize that trust, we wanted to have the framework set up to ensure we built that into the program.”

It’s a bit of a Catch-22, because everyone has to buy into the program for it to succeed, and everyone has to believe it will succeed before they’ll buy in.

In large part, Cal eConnect has done exactly that, Frohlich said. But not completely, he added.

“Because of the real lack of progress, there’s been a lot lost in that good-faith effort,” Frohlich said. Considering the CEO issues, the slow pace of progress over two years and the recent board change, “I suspect this will blemish to some extent the new organization. There may be some disillusion or lack of engagement because of the lack of progress. So they may have a bit of a hill to climb, if they’re going to be able to accomplish anything meaningful,” he said.

Frohlich is hopeful about the organization’s future, but has also winced a bit as he has watched what’s happened so far. “It’s very disappointing to see the outcome of two years of work come to this,” he said.

Cal eConnect has earned both trust and skepticism over the past two years, and Kizer, the head of IPHI, might be what tips the scales toward trust.

“I have a very favorable impression of him,” Frohlich said. “He has had some very impressive success at the VA. And he was previously director of the Department of Health Services, so clearly he has a good understanding of the state [bureaucracy], and implementation of HIE, and business.”

Kizer Focusing on What’s Next, Not Past

Kizer said his varied background — in government, in the business world, in not-for-profit work — all has one constant. “Using technology to make health care better is not new,” he said. “I’ve been doing that for a long time.”

And the Cal eConnect project, Kizer said, “is a great opportunity to realize a real benefit — to use technology to make life better for people.”

The new challenges and any administrative baggage that may accompany them don’t really bother him, Kizer said. “This may or may not be relevant,” he said, “but when President Clinton asked me to take over the VA, a large number of people said not to do it. A vast number of people. They said there was no likelihood of change. And see how that worked out.”

The Veteran’s Health Administration, the largest integrated health care system in the country, “changed for the better under the hands of Kenneth Kizer,” according to a 2006 report for the Health Information and Management Systems Society.

Kizer said he wants to focus on what’s next, not what’s in the past. The future of HIE lies in what happens over the next 18 months, he said, in the roll-up toward implementing federal health care reform in 2014.

“I would prefer to focus on the incredibly rich opportunity and the importance of all of this for a lot of people,” Kizer said. “There’s a limited time left on grant funds, so we have to show demonstrable progress in a short amount of time. We want to take advantage of all the good things that have been done, and there has been some good work done. HIE can have a large impact, and we want to make sure California reaps as much benefit as it can from it.”

Executive Order

On May 3, one week before the Cal eConnect board met to decide the near future of the organization, Gov. Jerry Brown (D) issued an executive order about the importance of the health care effort in the state. It said, in part:

“It is hereby ordered that reducing the individual, social and economic burdens of preventable and chronic conditions and improving the health of Californians is a priority for California.”

That edict had a significant impact on Cal eConnect board members, according to Laura Landry, the current CEO of Cal eConnect.

“When Brown signed that executive order, that meant something to everyone here,” Landry said. “The state needs HIE to work. It needs it. And there was an executive acknowledgement of that, and it makes you think: What is the right thing to do here?”

Landry is the chief administrator, but she said her expertise is more on the programmatic side. She has worked at Cal eConnect from the beginning and stepped in as interim CEO while the board searched for a permanent one, then became CEO when that process stalled.

“We’re incredibly good at the programmatic work, but someone needs to be the expert in writing the federal reports and that kind of thing. We were adequate at it, but it took a lot of time. We didn’t have the infrastructure for it.”

Landry said she sat in that meeting when the board ended the grant agreement, and she was vastly impressed with how committed everyone was to the project itself.

“It speaks well of the commitment of the people on the board, who are looking at the mission first, at the outcomes,” Landry said. “They’re all thinking, what’s the best thing for the program. And clearly, the best thing is to let the programmatic people do the programs.”

That’s the philosophy behind the administrative switch, she said. And even during this transition, Landry said, the work itself is moving forward quickly.

“That’s what we’re doing. We’re doing that right now, executing on a lot of the work right now,” Landry said. “We’re not waiting for anything.”

As for the controversy and stakeholder concern, Landry said there are two basic ways to view this administrative move — either the upheaval makes stakeholders a little wary of putting their trust in Cal eConnect going forward, or it instills a new sense of trust, that the organization saw it wasn’t moving quickly enough and acted boldly to fix it.

“We’ll see how it goes,” Landry said.

And then she gave a little laugh. “That’s the answer for everything HIE,” she said, “We’ll see how it goes.”

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