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HIT Perspectives – November 2022

Payers & FHIR: Seeing the Forest for the Trees

As final CMS payer-to-payer data exchange rule making looms, payers should begin developing a concrete, go-forward FHIR strategy to enhance broader business transformation efforts.

Jocelyn-KeeganBy  Jocelyn Keegan, Payer/Practice Lead 

Quick Summary

  • HL7 FHIR, after 11 years, has yet to move beyond buzzword status among most payers.
  • Incorporating FHIR into enterprise data exchange initiatives will help enable broader transformation efforts.
  • 30% of the world’s data are produced by the health care industry. Hospitals generate 50 petabytes each year. Data generation expected to increase 36% over three years.
  • CMS incorporated FHIR into rules in alignment with ONC.
  • FHIR is a designated component payer-to-payer data exchange specifications.
  • A recent HL7 survey of 135 members showed nearly 80% have FHIR servers and/or uses a specific FHIR implementation guide.
  • Orgs who have the data can improve member satisfaction and increase market share.
  • Northwestern payer, Regence, is using Da Vinci-developed, FHIR-based prior authorization processes to speed up care for members of MultiCare Connected Care.
  • Moving first and getting out ahead of  expected CMS requirements to use FHIR-based prior authorization standards could be a competitive edge for payers and others.

The Health Level Seven (HL7)® FHIR® (Fast Healthcare Interoperability Resources) standard celebrates its 11th anniversary this year. Introduced by Health Level Seven (HL7) in response to the market’s need for an easier, faster, and more cost-effective way to exchange health data, it has slowly but surely gained traction with health information technology (health IT) developers and providers – stakeholder groups that have both been prodded along by Centers for Medicare & Medicaid Services (CMS) data exchange rules and advisories. Now approaching its fifth iteration, FHIR has been heralded by many in the standards development, implementation, and enforcement world as a panacea of sorts, a transformational cure for the interoperability ills that have plagued data exchange since meaningful use was first enforced.

For all its potential, however, FHIR has yet to truly move beyond buzzword status among most payers. As federal rule making and enforcement around payer-to-payer data exchange move forward, payers must – if they haven’t already – begin to think about incorporating FHIR standards as part of broader business transformation efforts that will, ideally, enhance information exchange workflows across departments and with providers and other payers.

Payers, after all, sometimes suffer from the same silo problems that plague providers and health IT developers. Different payer departments, for example, may collect the same information from the same provider and use it for their own departmental projects rather than work across the enterprise to identify the most efficient, least burdensome way to acquire one data set that can then be shared for multiple uses.

Incorporating FHIR into these types of enterprise data exchange initiatives will help enable broader transformation efforts within a payer’s business and escalate industry-wide interoperability efforts poised to impact patient outcomes, administrative burden, provider friction, member satisfaction and, ultimately, everyone’s bottom line.

Where We Are Now

FHIR has had its share of the standards limelight over the past decade, prompting its advocates to refer to it and its interoperability-enhancing potential with many a fire-related adjective. Even HL7 recently dubbed it “the HOT (not so new) standard.”

Central to this enthusiasm and its many fun plays-on-words is its exponentially growing potential to handle the ever-increasing amounts of health data being exchanged among providers, patients and consumers, and payers. Since it was first developed, the amount of health data being shared – be it from and between wearables, electronic health records (EHRs), Revenue Cycle Management (RCM) systems, health information exchanges and other health care technologies – has skyrocketed. Analysts believe as much as 30% of the world’s data are produced by the health care industry, with hospitals alone generating 50 petabytes each year. That percentage is expected to jump to 36% within the next three years.

And FHIR has kept up. It now underpins thousands of applications and has been integral to the success of several high-profile initiatives including the Argonaut Project, which led to development of the first-generation FHIR application programming interface (API) and helped springboard FHIR implementation guides and the SMART on FHIR specification, among other data-sharing innovations; and HL7’s Da Vinci Project, which has brought together more than 20 companies to collaborate using FHIR to improve data sharing in value-based care programs.

As support for FHIR has evolved, so too has the federal government’s interest in its ability to power data exchange efforts across the industry. CMS has incorporated the standard into the Interoperability and Patient Access Final Rule, in alignment with Office of the National Coordinator for Health Information Technology (ONC) 21st Century Cures Act Final Rule and has made it a designated component of that legislation’s payer-to-payer data exchange specifications.forest with road-modified

Though issued in 2020, enforcement of those specifications has been delayed while CMS deliberates on the necessity of further rulemaking/clarification, leading payers, overall, to take a wait-and-see approach to further FHIR efforts. It’s a situation similar in nature to the early days of meaningful use (MU), when health IT developers and providers seemed to inch forward with MU requirements in direct proportion to CMS penalties.

Without a stick, payers may be hesitant to spend time and money cultivating carrots when they could be allocating their resources toward “crops” with more immediate return on investment. They may also be suffering from a “once bitten, twice shy” mentality after having built CMS-mandated patient access APIs that haven’t seen much in the way of utilization.

Payers, understandably, may be having a hard time seeing the forest of benefits through the cost of its trees. A shift in thinking may be necessary: Payers should look at FHIR as the seed that – if nurtured correctly – may just help new enterprise benefits flourish.

A Growing Interest

Payer adoption of FHIR hasn’t been completely stagnant. It is on the radar of most health plans as FHIR has been required by yet-to-be-released interoperability policies related to burden reduction and prior authorization as well as to those related to payer-to-provider data exchange. The payer-to-payer data exchange requirement mentioned above requires that payers be ready to share member data with other payers upon request as members change plans. These federal policies have been on the books in various shapes and sizes for several years, giving payers ample to time to at least acquaint themselves with the requirements.

The health care industry has definitely begun dipping its toes into FHIR waters. A recent HL7 survey of 135 member organizations, including nearly a dozen payers, indicates the groundwork for FHIR is already being laid: Nearly 80% of all respondents say they have FHIR servers while a similar percentage uses a specific FHIR implementation guide. Between 71% and 84% are using FHIR R4 in production and development. Though just 7% are already working with FHIR R5, which has yet to be formally published, 40% will start working with it when it is ready for prime time. Its value is being realized as is its potential to change internal and external workflows.

Addressing the Challenges

Barriers to adoption do exist, of course, as payers realize that a one-size-fits-all approach to incorporating FHIR isn’t viable. Thirty-one percent of survey respondents say they’ll wait for a regulatory reason to use R5. Even a third of those already intimately familiar with FHIR will choose to press pause on being proactive with its next iteration.

When it comes to adoption and integration, payer skittishness no doubt stems from the aforementioned lack of time, money, resources and even absence of regulatory penalties. Some have done the bare minimum in the name of compliance to free up resources for other, more pressing needs. To address adopting FHIR in truly meaningful ways, HL7 survey respondents note they’ll have to overcome these top challenges:

  • Lack of the standard’s maturity
  • Lack of available qualified developers
  • Implementation complexity
  • Lack of adoption among EHR vendors
  • Lack of adoption among payers

Payers, specifically, have also mentioned challenges related to staff ability to implement and work with FHIR, as well as to updating their IT systems to handle FHIR-friendly data exchange. Security concerns have also been voiced, with unauthorized access to health data via FHIR APIs a very real fear among stakeholders in today’s world of ever-increasing ransomware attacks. Some feel FHIR’s roots in clinical data demonstrate lack of robustness to effectively supporting exchange of financial and administrative data. In addition, the lack of member interest in patient-access APIs has no doubt hampered any sense of urgency payers may have been inclined to feel about further enhancements to those APIs, leaving integrations at a bit of a standstill. Technology partners, in turn, are left waiting for more mature payer APIs through which to connect their apps, leading to further interoperability impediments.

And then there’s the age-old silo problem. Looking at the FHIR forest from an aerial view, payers must recognize that their departments (or trees, if you will) must review the ways in which they operate when it comes to sharing data. Technology for technology’s sake won’t solve inefficiencies more related to data governance and quality issues. It’s garbage in, garbage out as they say. As part of the same organization, departments must be brutally honest in assessing what and whom they do and don’t need from a technology and partnership perspective if they are to reap the enterprise-wide benefits of FHIR.

Proactive Payers Reap FHIR Benefits

While the challenges may seem daunting, it is essential that payers understand the long-term benefits of embedding FHIR within their health data exchange workflows and overall business transformation processes. Perhaps former Network Health of Wisconsin Vice President of Information Systems Delivery, Diane Gabrielsen, put it best at the Healthcare Information and Management Systems Society (HIMSS) meeting earlier this year: “When payer-to-payer happens, I’m going to have more info about the patient than you [the provider] will the day they walk through the door.”

Gabrielsen pointed out what successful data-sharing stakeholders already know – those who have the data have the ability to improve member satisfaction and increase market share; help improve patient outcomes; engage in more meaningful, in-depth population health efforts; streamline business processes and, importantly, decrease the cost of care.

Advantages are already being realized by those payers that have strategically sought out technology partners and invested in FHIR-based processes to enhance things like payer/provider data exchange and prior authorizations. Imagine the possibilities if payer-to-provider data exchange were added to the interoperability mix. New York-based payer Healthfirst, for example, is using a cloud-based platform built on FHIR that enables it to efficiently share claims, quality measures and EHR data with providers to more effectively identify gaps in care.

Northwestern payer Regence is using Da Vinci-developed, FHIR-based prior authorization processes to speed up care for members of MultiCare Connected Care, an accountable care organization (ACO) affiliated with the MultiCare Health System in Washington. The ACO expects the new point-of-care prior authorization project will result in expedited, evidence-based care with improved outcomes leading to increased patient satisfaction.

Vendors like Epic and Cerner have been supporters of FHIR for some time now, enhancing their software to accommodate FHIR-based APIs. Other companies, anticipating eventual federal enforcement of payer-to-payer data exchange, are developing technologies to make FHIR-based data sharing as effortless as possible. Founding HL7 Da Vinci Project member Edifecs, for example, recently launched its cloud-based payer-to-payer data exchange solution, including a member app for comprehensive viewing of member health data.

The less quantifiable side of a payer’s return on their FHIR investment shouldn’t be ignored, either. Easier, FHIR-based data exchange will undoubtedly result in increased levels of member satisfaction and trust within an organization’s provider network – hard to quantify but priceless all the same.

The Time Is Now

As providers and health IT developers become increasingly receptive to FHIR-based processes and evidence of its effectiveness at cutting costs, increasing access, and improving care mounts, payers must be proactive about adopting and innovating with FHIR. Moving forward with FHIR will likely result in payers first taking an honest look at where they are and how their processes might lead to change. While FHIR can enable more real-time data exchange, its potential to transform other internal business processes remains untapped.

As former National Coordinator Don Rucker has said, “There’s an advantage for those who move first.” Moving first and getting out ahead of what is sure to be a requirement coming out of CMS (late 2022/early 2023) to utilize FHIR-based standards to automate and expedite the prior authorization process could be that competitive edge for payers and others. That competitive edge is waiting to be had by those forward-looking payers who are prepared to devote time and energy to preparing a FHIR strategy built on common enterprise-wide priorities and investments – one that will pave the way for true interoperability and value-based care. It’s just a matter of seeing the forest for the trees.

If you need help with understanding the interoperability landscape, check our interoperability outlook subscription service. If you need support understanding how current and expected policies may impact your interoperability roadmap, contact me at jocelyn.keegan@pocp.com to set up some time to explore how we might be able help.