An Unprecedented Opportunity: C A L I FOR N I A H EALTH C ARE Using Federal Stimulus Funds to Advance Health IT in California F OU NDATION Introduction It is a process that requires time, as well as changes The Health Information Technology for Economic in how physicians and other clinicians practice; and Clinical Health (HITECH) Act, a component changes in enterprise and industry workflows; and of the vast federal stimulus legislation known as changes in legacy health IT infrastructure that was Issue Brief the American Recovery and Reinvestment Act not designed to exchange data with other systems. of 2009 (ARRA), authorizes roughly $36 billion in outlays over six years for health information As the Obama Administration has indicated, the technology — an unprecedented investment in ARRA funds allocated to health care — including the nation’s health information infrastructure. Its more than $36 billion in funds directed towards success will be measured in part by how well it is health IT infrastructure and adoption incentives implemented and the impact it has on improving authorized in the HITECH Act — are a down the quality, safety, and efficiency of care. payment on the much larger amount needed to effect meaningful reform of health care in the Unlike almost all other industries that have United States. implemented information technology, health care retains many of the characteristics of a California — the center of innovation in cottage industry. Despite decades of attempted biotechnology, health IT, and health care consolidation, a sharp focus on quality and delivery — is well positioned to make effective use consistency, and a modest investment in health of the ARRA funds. This issue brief presents an information technology (health IT), health care analysis of the Act and recommendations to the practice remains largely unchanged: fragmented, Schwarzenegger Administration, the California inconsistent, and only intermittently automated. Legislature, and others on how to prepare for, While many hospitals and large medical groups compete for, and use the state’s fair share of the have adopted health IT systems, most of their those funds, which could amount to more than smaller counterparts have not had the resources, $3 billion. financial incentives, or economies of scale to do so. Overview of the HITECH Act Although health IT alone will not transform The HITECH Act sets forth a framework for the health care, it does have the potential to stimulate development of federal policy and the expenditure changes that will enhance the quality and safety of federal stimulus money to advance the design, of health services, stabilize or decrease their development, and operation of a nationwide cost, reduce waste and inefficiency, increase health information technology infrastructure transparency, and transform the health care that allows for the electronic use and exchange enterprise into a learning organization with the of information. The goal of the legislation is to capacity to self-correct and improve. Experience ensure that each person in the United States has an F ebruary has shown that this potential is not easily realized. electronic health record by 2014. 2009 While the Act leaves significant discretion to the Secretary a governance mechanism for the Nationwide Health of Health and Human Services (HHS) with respect to the Information Network (NHIN). details of federal policy implementation, it sets specific responsibilities for the public and private agencies that The legislation authorizes the outlay of federal money in will be charged with developing and implementing federal an amount estimated by the Congressional Budget Office policy. It also establishes program goals and eligibility (CBO) to be roughly $36 billion over six years. The vast criteria applicable to those private entities that will receive majority of funds — approximately $34 billion — are federal money. Specifically, the HITECH Act requires the expected to be distributed between 2011 and 2016 as development of: adoption incentives through Medicare and Medicaid Policies, new technologies, and approaches for to qualified health care providers who adopt and use protecting the privacy and security of health electronic health records (EHRs) in accordance with the information; Act’s requirements. (See Figure 1 on page 3 for a flow chart of the Act’s funding streams.) The Act specifically Strategies to enhance the use of health information acknowledges that additional money may be needed to technology in improving the quality of care, reducing accomplish the legislation’s goals, requesting that ONC medical errors, reducing health disparities, improving report to Congress annually on the resources required. public health, increasing prevention and coordination with community resources, and improving the The HITECH Act’s EHR adoption incentive investments continuity of care among health care settings; and will be distributed based on statutorily defined formulas. Specific plans for ensuring that the technology —  Qualified health care providers are entitled to receive including those systems that automate the enrollment incentive payments if they meet the Act’s requirements and retention of eligible individuals — is designed to for being “meaningful” EHR users. The requirements be appropriate for populations with unique needs. are defined as: the use of certified EHR technology in a manner that includes the use of electronic prescribing The HITECH Act provides the HHS Office of for office-based physicians and is capable of exchanging the National Coordinator (ONC) with substantial electronic health information to improve the quality of responsibility for setting strategy, including: harmonizing health care; and the submission of information on clinical the efforts of federal agencies and the private sector; quality and other measures as selected by the secretary of recommending standards, implementation specifications, HHS. It is anticipated that additional requirements to and certification criteria needed for the electronic meet the “meaningful use” test will be developed during exchange and use of health information; and designing a the rule-making phase. plan for coordinating the implementation of the grant, loan, demonstration programs, and incentive payment In addition to the Medicare and Medicaid incentives, the requirements authorized by the Act. HHS secretary will make a foundational investment of $2 billion in infrastructure outlays through grants, loans, The Act creates two federal advisory committees to and demonstration programs consistent with a strategic advise the ONC — a HIT Policy Committee and a HIT plan developed by the ONC. The HHS secretary is Standards Committee — to provide formal mechanisms provided with wide discretion in how to allocate the for private sector input into federal policy. Among other $2 billion; among the authorized areas of investment are: requirements, it specifically calls for the ONC to establish 2  |  California HealthCare Foundation Figure 1. HITECH Act Funding Flows RECIPIENTS DISTRIBUTION PROGRAM AGENCY* USE OF FUNDS Entitlement Funds (roughly $34 billion in gross outlays) Acute Care and Medicare Incentive Payments Children’s Hospitals CMS Payment Incentives through Carriers Incentive Payments Medicaid CMS through State Agencies Physicians Payment Incentives and States Requires 30% share of Medicaid and Dentists (except children’s hospitals). Nurse Practitioners and Midwives Appropriated Funds ($2 billion in gross outlays) Planning Grants FQHC HIE Planning and ONC State-designated Development Requires “meaningful” use of EHR. Implementation Entity Grants States EHR Adoption ONC Loan Funds LOANS Loan Program Health Care Providers Health IT Research Center Indian Tribes Health IT ONC Extension Program Regional Extension Centers Least-advantaged SERVICES Medical Nonprofits Providers Health Informatics Workforce HHS, Training Grants NSF EHR in Medical School Curricula Higher Education and Medical / Graduate Schools Health Care New Technology NIST, Information Enterprise Research and NSF Integration Federal Development Grants Research Centers Government Labs Source: Manatt Health Solutions analysis of federal HITECH Act legislation. *CMS stands for Center for Medicare and Medicaid Services, ONC is Office of the National Coordinator for Health Information Technology, HHS is Federal Department of Health and Human Services, NSF is National Science Foundation, and NIST is National Institute of Standards and Technology. An Unprecedented Opportunity: Using the Federal Stimulus Package to Advance Health IT in California  |  3 Funding to strengthen the health information Key Recommendations for California technology infrastructure at the regional, state, and The State of California has a significant leadership role to multi-state level; play in ensuring that patients, consumers, and the public realize the quality and safety benefits intended from Health information technology implementation the HITECH Act’s investment in the effective use and assistance; adoption of EHRs and HIE. State grants to promote health information technology; To be eligible to draw upon the billions of dollars in funds provided by the HITECH Act for EHR adoption Grants for the development of loan programs to and use, health care providers must be connected in facilitate the widespread adoption of certified EHR a manner that provides for the electronic exchange of technology; and health information to improve the quality of health Demonstration programs to integrate information care. California will only be able to meet this statutory technology into clinical education and assistance requirement if the state collaborates with private to establish or expand medical health informatics stakeholders to create health information exchange education programs. capabilities that serve all California residents. It is expected that a significant amount of the HITECH In order for the state to meet its obligations and perform Act’s infrastructure investments will be used to support the tasks required to make California competitive in health information exchange (HIE) projects designed, applying for federal funds, this analysis presents 24 built, and operated in accordance with emerging federal recommendations to the Schwarzenegger Administration policy requirements. Significantly, the Act explicitly and the California Legislature, including these key allows these investments to be made through states or recommendations: qualified state-designated entities. These entities are Appoint a Deputy Secretary of Health IT. defined as multi-stakeholder, nonprofit organizations that The governor should appoint a Deputy Secretary are designated by a state to conduct activities to facilitate of Health IT, established within the California and expand the electronic movement and use of health Health and Human Services Agency (CHHSA), to information among organizations according to nationally coordinate and drive the state’s health IT strategy recognized standards. and implementation. It is crucial that CHHSA play a leadership role in facilitating a comprehensive By tying EHR adoption incentive investments to HIE strategy, which is a foundational requirement meaningful EHR use and including HIE, the HITECH for obtaining HITECH Act funds and a key to Act suggests that the design, development, and operation ensuring that investments in health IT care are used of an HIE may be a precondition to obtaining incentive to improve the quality, safety, and efficiency of health funds for EHR use. Since the funds are substantial, it care to California residents. can be expected that states, along with other interested stakeholders, will need to pursue HIE strategies consistent Select a qualified state-designated entity. The with emerging federal policy requirements. state should take such actions as necessary to select a qualified state-designated entity or entities to apply for the HIE implementation funding made available under the HITECH Act. Selection criteria should 4  |  California HealthCare Foundation include a public-private governance structure that can health privacy law and recommend best practices for inform federal policy guidance and develop statewide facilitating legal compliance. The California Office of policy guidance through a transparent, statewide Health Information Integrity should also take steps collaboration process. Policy guidance should include to educate patients, consumers, and the public on well-defined technical architecture plans and clinical new and existing health privacy safeguards intended requirements that allow for appropriate governance to ensure the confidentiality and security of personal at the state and regional levels, as well as privacy and health information. security to protect the flow of patient information. Specific Areas for Policy Development Match funding needs to objectives. CHHSA and and Funding California’s state-designated entity should develop This section summarizes each of the primary elements and advance policy recommendations regarding the of the HITECH Act and offers recommendations for amount of additional funding required to accomplish how California can influence federal policymaking for the health IT objectives of the HITECH Act, where directing HITECH Act funds and position itself to put the funds should be spent, and how they should be them to use. A glossary of terms used in the discussion allocated. can be found on page 19. Facilitate Medi-Cal incentive payments. The California Department of Health Care Services Federal Policy and Standards-Setting should establish policies, procedures, and information Framework systems required to facilitate Medi-Cal incentive The HITECH Act sets forth a federal framework for the payments for the implementation and adoption of development of policies, standards, rules, and regulations EHRs by physicians, hospitals, community health that will apply to all recipients of health IT funding centers, and others in California, as authorized by the (Figure 2). The framework consists of the following HITECH Act. components: Get a seat at the federal table. The governor should Office of the National Coordinator (ONC) of appoint individuals to actively engage with federal Health Information Technology. Located within the officials and policymakers to ensure that California Department of Health and Human Services, the ONC has a meaningful voice at the table during the is responsible for a broad range of duties intended to regulatory process within which the HITECH Act’s promote the development of a nationwide health IT specific funding mechanisms will be determined. infrastructure that allows for the electronic exchange and Authorize matching funds. The legislature should use of information. These include: appropriate funds in the amount required to match Developing an annual strategic plan that reports on the federal funding authorized under the HITECH specific objectives, milestones, and metrics, including Act in order for California to take full advantage of the use of an electronic health record for each person the opportunities available through the Act. in the United States by 2014; Provide technical guidance and education. The Providing oversight and coordination of both the California Office of Health Information Integrity HIT Policy and HIT Standards Committees; should disseminate technical guidance to all parties that engage in electronic information exchange to Reporting to Congress within 12 months on any clarify the interplay between California and federal additional funding or authority needed to ensure full An Unprecedented Opportunity: Using the Federal Stimulus Package to Advance Health IT in California  |  5 Figure 2. Federal HIT Policy and Standards Process HHS Secretary Reviews ONC endorsements and decides whether to adopt no later than 90 days from receipt ENDORSES Office of the National Coordinator Receives recommendations and decides whether to endorse to HHS Secretary RECOMMENDS HIT Policy Committee* HIT Standards Committee* Recommends policies relating to a national Recommends standards, implementation health IT infrastructure and recommends specifications, and certification criteria priorities for the development, harmonization, for the electronic exchange and and recognition of standards, use of health information. specifications, and certification criteria. National Institute of Standards and Technology Tests standards and creates a conformance testing infrastructure. Source: Manatt Health Solutions analysis of federal HITECH Act legislation. *Nothing prohibits the National eHealth Collaborative (NeHC) from assuming these roles, so long as NeHC’s charter, duties, and membership are changed to meet the provisions of the HITECH Act . participation of stakeholders in the national health IT the use of electronic health information to improve the infrastructure; and quality of health care. The HIT Policy Committee will also recommend an order of priority for the development, Establishing a governance mechanism for the harmonization, and recognition of standards, as well as nationwide health information network. implementation specifications and certification criteria for the electronic exchange and use of health information. HIT Policy Committee. This federal advisory committee is charged with making recommendations to the ONC HIT Standards Committee. The HIT Standards with respect to a policy framework for the development Committee will recommend which standards are to be of the nationwide health information infrastructure. adopted, along with implementation specifications and Duties include making recommendations in a wide certification criteria for the electronic exchange and use variety of areas, such as technologies that protect privacy of health information. The Act does not specify how of health information and the steps necessary to ensure existing processes relating to standards development and 6  |  California HealthCare Foundation harmonization — through organizations like the Health Recommendation 2. CHHSA and California’s state- Information Technology Standards Panel (HITSP), designated entity should ensure that states are represented Certification Commission for Healthcare IT (CCHIT) and actively participate in the HIT Policy and Standards and the National eHealth Collaborative (NeHC) — will Committees. Specifically, California’s representatives fit into the new framework, though it does note that should ensure that the federal government emphasizes an NeHC may modify its charter to perform the duties of incremental approach to standard setting that maximizes either the HIT Standards or Policy Committee. clinical benefit by enhancing the existing flow of available clinical data. The federal policy framework provides the ONC and the Secretary of HHS broad authority to tie federal dollars Recommendation 3. CHHSA and California’s state- to specific policies and standards developed to promote designated entity should develop and advance policy the Act’s broad policy objective of designing, building, recommendations as to the amount of additional funding operating, and governing a nationwide health information required to accomplish the health IT objectives of the infrastructure. HITECH Act. There are many issues left open by the HITECH Federal Privacy Framework Act, including which standards and technologies will In addition to creating a new federal policy and standards- be specified and the specific governance structure, setting framework, the HITECH Act strengthens the administrative requirements, and contractual rules that privacy and security provisions of the Health Insurance will be developed to oversee the nationwide health Portability and Accountability Act (HIPAA) in five key information infrastructure. Most significantly, key areas. Many of these changes will have a direct impact on definitions that will determine whether funds can be organizations participating in HIE projects in California. obtained — such as how health information exchange is defined and what it means to be a meaningful electronic Extension of HIPAA to business associates. The health record (EHR) user — are left to the federal HITECH Act requires entities or individuals who rule-making process. have access to protected health information but do not provide direct medical care to comply with the HIPAA Like all stakeholders who stand to benefit from the security rule provisions mandating the implementation of sizeable investment dollars made available through the administrative, physical, and technical safeguards, as well Act, California has a keen interest in ensuring that federal as the restrictions on the use and disclosure of protected policy develops in a manner that is consistent with and health information in the HIPAA privacy rule. These supports the state’s unique characteristics and its own “business associates” may be subject to civil and criminal policy goals. penalties for violating these requirements. Accordingly, health IT vendors, some of whom are already subject to Recommendations for California the California’s Confidentiality of Medical Information Recommendation 1. CHHSA and California’s state- Act, will be directly regulated under HIPAA for the first designated entity should ensure that the ONC’s strategic time. plan supports California’s policy objectives and existing users of health IT systems, and that the governance Security breach notification mandate. The HITECH structure developed at the federal level recognizes the role Act establishes the first national data security breach of state-designated entities. notification law. The statute requires health care An Unprecedented Opportunity: Using the Federal Stimulus Package to Advance Health IT in California  |  7 providers, health plans, and other HIPAA covered entities, obligation is phased in over the next five years based on as well as personal health record vendors, to notify the date an electronic health record system is acquired by affected individuals, government agencies, and the media the entity. of the unauthorized acquisition of electronic, unencrypted protected health information. HIPAA now requires only Increased HIPAA enforcement. The HITECH Act that covered entities mitigate the potentially harmful establishes a tiered system of civil penalties based on the effects of improper disclosures. The federal notification nature of the improper conduct. The maximum penalty standards overlap with, but differ from, the standards is $500,000 per violation, up to $1.5 million per year established under California’s breach notification law, for each type of violation. The maximum civil penalty which do not necessarily require notification to the is now $100 up to a limit of $25,000. HHS is required individual and do not require media notification. to impose civil penalties on a covered entity that engages in “willful neglect.” State attorneys general are granted New restrictions on the use and disclosure of authority to enforce HIPAA. HHS is directed to evaluate protected health information. The HITECH Act how to enable affected individuals to share in penalties places new restrictions on certain uses and disclosures of collected for violating HIPAA. The Act clarifies that protected health information. A covered entity will now criminal penalties may be imposed on any individual or be prohibited from receiving or paying remuneration for organization, not just covered entities. the disclosure of protected health information, except for disclosures for limited purposes, such as treatment, In summary, the Act creates new obligations on health research, and fraud prevention. HHS is assigned care providers, health plans, technology companies, and responsibility for evaluating whether remuneration personal health record vendors involved in electronic for these permitted disclosures should be capped. In health information exchange in California. These addition, covered entities are prohibited from using obligations build on existing requirements imposed under protected health information to make communications California law. Organizations contemplating participation to individuals about the covered entity’s products or in electronic health information exchange are likely to services if another party is paying for the communication, be concerned about ensuring compliance with these except in limited circumstances. For example, a pharmacy complex rules, especially in areas where state and federal could not send out information about a new drug to law overlap. Significant work will be done at the federal its customers if a pharmaceutical company paid the level to develop a regulatory framework and implement pharmacy for the mailing. these new laws. California’s residents will be best served by dedicated, active engagement in that process. Additional patient rights. The HITECH Act requires covered entities to honor a patient’s request not to share Recommendations for California information with the patient’s health insurer if the patient Recommendation 4. The Office of Health Information is paying the full cost of the service. Covered entities Integrity should disseminate technical guidance to all maintaining electronic health records are required to parties that engage in electronic information exchange to give patients copies of such records in electronic form. clarify the interplay between California and federal law, They are also obligated, at a patient’s request, to provide especially in light of recently enacted California health an audit trail of all disclosures of the patient’s protected privacy legislation — specifically SB 541 (Alquist) and health information made for treatment, payment, and AB 211 (Jones) — and recommend best practices for health care operations during the prior three years. This facilitating legal compliance. 8  |  California HealthCare Foundation Recommendation 5. The Office of Health Information Medicare and Medi-Cal EHR Adoption Integrity should take steps to educate patients, consumers, Incentive Payments and the public on existing health privacy safeguards and The most significant funding opportunity in the protections intended to ensure the confidentiality and HITECH Act for health information technology is security of personal health information. incentive payments to induce providers — hospitals, clinics, physicians, dentists, nurse practitioners, nurse Recommendation 6. CHHSA and California’s state- midwives, and physician assistants ­  who receive — designated entity should develop statewide policy payments from Medicare and Medi-Cal to adopt and guidance setting forth privacy and security rules, make meaningful use of electronic health records protocols, and procedures for participation in qualified (Tables 1 and 2). health information exchanges. To obtain EHR adoption incentive investment funds, providers must demonstrate that they are meaningful EHR users and meet specific criteria related to the percent of patients they serve in either the Medicare or Medicaid program. Applicants must: Table 1. Summary of Medicare Incentive Payment Provisions Funding Mechanism Entitlement Funding Entity Centers for Medicare and Medicaid Services (CMS) Allocation Process Reimbursement Matching Funds Requirement None Timing Begins in 2011 Funds Flow Through Medicare carriers Eligible Recipients •Hospitals that are “meaningful users” of EHRs •Physicians who are “meaningful users” of EHRs (These professionals must choose to be reimbursed under Medicare or Medi-Cal terms. The two options are mutually exclusive.) Level of Federal Funding CBO has estimated outlays for the combined Medicare/Medicaid incentives to be approximately $34 billion over the fiscal years 2009 through 2016. The CBO also estimates net savings to the federal health entitlement programs beginning in fiscal year 2016, but it is not clear what the savings estimates assume. •Hospitals receive base funding of $2 million, plus additional funds based on formula prescribed in the statute. •Physicians may receive up to a maximum of $44,000 over five years; if reimbursement begins in 2013, the maximum amount is $42,000, with the largest incentives in the first year and declining annually via reductions in the Medicare fee schedule. Requirements for Funding Physicians receiving Medicare payments must demonstrate (through self-reporting or claims reporting) “meaningful EHR use,” defined as: use of a certified EHR, including electronic prescribing, that is “connected” to an HIE, and submission of clinical quality and other required measures. All criteria must be met and reconfirmed each payment year. The HHS secretary has discretion in allowing alternative means for meeting requirements and can make requirements more stringent over time. Physicians who are employed or provide a significant percentage of care via Medicare Advantage (75 percent of professional services or at least 20 hours/week) are eligible for incentive funds, but are prohibited from duplicate payment (under fee-for-service and via Medicare Advantage). An Unprecedented Opportunity: Using the Federal Stimulus Package to Advance Health IT in California  |  9 Show use of a certified EHR technology in a HITECH Act delineates that hospitals are eligible for meaningful manner, which includes the use of a base funding amount of $2 million, plus additional electronic prescribing for office-based physicians; amounts based on discharge data and patient stay data formulas. Independent physicians are eligible for up to Show use of a certified EHR technology that $44,000 in incentive payments over five years; through is connected in a manner that provides for the Medicaid incentives, a physician can receive up to electronic exchange of health information to improve $64,000 over five years. Physicians must choose to be the quality of health care; and reimbursed under either Medicare or Medicaid. Submit information on clinical quality and other measures as selected by the HHS secretary. California receives approximately 14 percent of federal Medicare and Medicaid spending. Therefore it is The CBO estimates payments of approximately $34 reasonable to assume that California’s fair share of billion between federal fiscal years 2009 and 2016, with the Medicare and Medicaid incentive payments for initial incentive payments commencing in 2011. The EHR adoption will be greater than 10 percent of the Table 2. Summary of Medi-Cal Incentive Payment Provisions Funding Mechanism Entitlement Funding Entity CMS and the state Allocation Process Reimbursement  Matching Funds Requirement 10 percent state match on administrative expenses, including the tracking of meaningful use, conducting oversight, and pursuing initiatives to encourage adoption; 100 percent federal match on incentive payments Timing Begins in 2011 Funds Flow Through California Department of Health Care Services (DHCS) Eligible Recipients •Physicians, dentists, nurse practitioners, nurse midwives, and physician’s assistants practicing in specific circumstances, who are not hospital-based and have at least 30 percent of patient volume attributable to Medi-Cal beneficiaries •Pediatricians who are not hospital based and have at least 20 percent of patient volume attributable to Medi-Cal beneficiaries •Acute care hospitals that have at least 10 percent of patient volume attributable to Medi-Cal beneficiaries •Children’s hospitals •FQHC or rural clinics that have at least 30 percent of patient volume attributable to “needy individuals,” including but not limited to Medi-Cal beneficiaries •Third-party entities that sponsor and encourage EHR adoption can also qualify for funding through the Medicaid incentive payment structures.  Such entities are likely to serve as de facto purchasing and implementation agents; Medicaid incentive payments for physicians who participate in such arrangement would flow to the third party.  It appears a third party must demonstrate that 95 percent of the funding will be used to purchase, operate, and maintain the EHR for independent physicians, and is allowed to keep 5 percent of the funding to cover any overhead it incurs in doing so. Level of Federal Funding The CBO has estimated outlays for the combined Medicare/Medicaid incentives to be approximately $34 billion over the federal fiscal years 2009 through 2016. It also projects net savings to the federal health entitlement programs beginning in fiscal year 2016, but it is not clear what the savings projections assume. Requirements for Funding Demonstrated use of certified EHR technology connected in a way that provides for health information exchange; compliance with reporting requirements 10  |  California HealthCare Foundation $34 billion outlay for this purpose, producing a total of Infrastructure Investments more than $3 billion in incentive payments in California, The HITECH Act includes $2 billion in investments depending on adoption rates. to be made by HHS through grants, loans, and demonstration programs that are consistent with a Recommendations for California strategic plan developed by the ONC. The HHS secretary Recommendation 7. CHHSA and California’s state- is given wide discretion in allocating these funds. designated entity should engage with the Secretary Authorized areas of investment include: of HHS, the National Association of State Medicaid Funding to strengthen the health information Directors (NASMD), the ONC, and others to ensure technology infrastructure; that the definition of meaningful EHR user incorporates two key concepts: (1) robust HIE requirements that allow Health information technology implementation for exchange of a clinical record summary and single and assistance; uniform interfaces from significant data sources, such State grants to promote health information as labs and pharmacies; and (2) strong clinical quality technology; measures. Grants for the development of loan programs to facilitate the widespread adoption of certified EHR Recommendation 8. CHHSA and California’s state- technology; designated entity should engage with the federal Secretary of HHS to encourage the development of appropriate Demonstration programs to integrate information alternative means of demonstrating meaningful EHR use technology into clinical education and assistance for physicians who are in a group practice and provide to establish or expand medical health informatics services to Medicare or Medi-Cal recipients. education programs. Recommendation 9. The Department of Health Care The following are brief summaries of the specific areas of Services (DHCS) should ensure that requirements defined funding and recommendations for maximizing the impact for the current Medi-Cal Management Information these funds could have on California’s health care. System (MMIS) fiscal intermediary procurement include: (1) the ability to share information bidirectionally Health Information Exchange Planning and through a California Health Information Exchange; Implementation Grants and (2) the delineation and implementation of new The HITECH Act authorizes ONC to award grants to requirements necessary to meet the reporting, payment, states and qualified state-designated entities to develop and other requirements of the HITECH Act. and implement programs for HIE. States and state- designated entities will be eligible for either planning or Recommendation 10. DHCS should report annually to implementation grants. Planning grants are intended to the legislature on the number of Medi-Cal providers who jump-start HIE projects where actual implementation have adopted EHRs, as well as any challenges that would has yet to begin. Larger implementation grants will go need to be overcome to support further adoption. to states in which HIE activities are well underway or to states that have detailed plans in place that can be put into action. An Unprecedented Opportunity: Using the Federal Stimulus Package to Advance Health IT in California  |  11 It is important that the State of California focus its efforts drive health IT and HIE implementation. It is crucial to steer the incentive payments to California Medicare that CHHSA play a leadership role in facilitating a and Medi-Cal providers and take steps to ensure that comprehensive HIE strategy, which is a foundational these providers can qualify as meaningful EHR users requirement for obtaining HITECH Act funds and a key and connect in a manner that provides for the electronic to ensuring that investments in health IT care are used to exchange of health information. improve the quality, safety, and efficiency of health care service to California residents. California is well-positioned to compete for implementation funds, given the many public and Recommendation 12. The state should take such commercial health information technology initiatives actions as necessary to select a qualified state-designated currently underway throughout the state. Table 3 entity to apply for the HIE implementation funding summarizes the main elements of the requirements for made available under the HITECH Act. Criteria used in the planning and implementation grants. selecting this new state-designated entity should include a public-private governance structure that can inform Recommendations for California federal policymaking and guide state policy through The following recommendations are consistent with the a transparent statewide collaboration process. Policy California’s Health IT Financing Advisory Commission’s guidance shall include well-defined technical architecture recommendation that the state create a public-private plans and clinical requirements that allow for regional partnership to catalyze statewide collaboration. market governance and innovation, as well as policies and procedures related to privacy and security to protect the Recommendation 11. The governor should appoint flow of patient information. a Deputy Secretary of Health IT within the California Health and Human Services Agency to coordinate and Table 3. HIE Planning and Implementation Grants Funding Mechanism Federal appropriations Funding Entity The Federal Department of Health and Human Services, through the Office of the National Coordinator (ONC) Allocation Process Competitive grant process. Details will emerge from the regulatory process. Matching Funds State matching funds may be required in federal fiscal years 2009 and 2010 (and will be required in 2011). The Requirement statute notes that matching funds may be in-kind, but does not provide further detail. Timing Funds are available upon the delivery of ONC’s strategic plan to Congress, due within 90 days of passage of the bill. Funds Flow Through ONC Eligible Recipients States or state-designated entities. To be considered a state-designated entity, an organization must be formally designated by the state, be nonprofit, and be committed to improving health care quality and efficiency through HIE, among other requirements set out in the statute. Level of Federal To be determined Funding Requirements Grants must be used to support HIE planning or implementation. Minimal criteria to receive the larger for Funding implementation grants are likely to include operational governance, a technical plan, well-defined clinical use cases, and statewide privacy and security policy guidance. 12  |  California HealthCare Foundation Recommendation 13. CHHSA and California’s state- to construct eligibility requirements and prioritize least- designated entity should develop and advance policy advantaged providers; (2) incorporate and coordinate recommendations regarding the amount of additional existing loan fund sources and account for any specific funding required to accomplish the health IT objectives eligibility requirements; and, (3) develop payment terms of the HITECH Act, as well as key requirements for that recognize forthcoming Medicare and Medi-Cal obtaining the funds already made available under the Act. incentive payments. Electronic Health Record (EHR) Loan Fund Recommendation 15. Loans made through the EHR Many health care providers — most notably rural and loan programs should be directly tied to federal and state public hospitals, community health centers, and small requirements, including the purchase and installation of group and individuals physician offices — face significant certified EHRs that enable providers to meet the Act’s economic challenges and barriers in obtaining capital for meaningful use requirement, support for state quality and purchasing EHR systems. The HITECH Act includes public health goals, and the reporting of performance grant funding to states for use in providing loans to measures. In addition, loan requirements should provide providers for EHR adoption, as summarized in Table 4. for adequate support and, if appropriate, steer select providers towards purchasing EHR software and services Recommendations for California through technical service organizations. Recommendation 14. The State of California should apply for federal funds to create a revolving loan fund that incorporates multiple programs for a broad range of providers. The program should: (1) consider how best Table 4. EHR Loan Fund Funding Mechanism Federal appropriations Funding Entity The federal Department of Health and Human Services, through the Office of the National Coordinator (ONC) Allocation Process Competitive grant process Matching Funds States or Indian tribes must provide a cash match equal to $1 in state funds for every $5 in federal funds. States Requirement may couple their grants with private sector contributions in an attempt to increase the amount of loan funding they can offer providers. Timing ONC may not award grants prior to January 1, 2010. Funds Flow Through ONC to states or Indian tribes, which are to use the grants to provide loans to health care providers for EHR adoption. Eligible Recipients States or Indian tribes Level of Federal Funding To be determined Requirements Loan funds may be used by providers to: (1) facilitate the purchase of certified EHR technology; (2) enhance the for Funding utilization of certified EHR technology (which may include costs associated with upgrading health information technology so that it meets criteria necessary to be a certified EHR technology;( 3) train personnel in the use of such technology; or (4) improve the secure electronic exchange of health information. The state must create an annual strategic plan that: identifies the projects to be assisted through the loan fund; describes the criteria and methods established for the distribution of funds from the loan fund; describes the financial status of the loan; and specifies the short-term and long-term goals of the fund. An Unprecedented Opportunity: Using the Federal Stimulus Package to Advance Health IT in California  |  13 Health Information Technology Regional Recommendations for California Extension Centers Recommendation 16. CHHSA should engage with The HITECH Act recognizes that effective adoption and the federal HHS secretary, National Association of State use of EHRs represents a significant challenge. As a result, Medicaid Directors (NASMD), the ONC, and others to the Act directs the Secretary of HHS, through the ONC, ensure that there is a substantive state role in selecting, to establish a new national entity within HHS, the Health designating, and evaluating Regional Extension Centers Information Technology Research Center (HITRC), (RECs). The RECs must accommodate a broad range of and to establish Health Information Technology providers in the state and prioritize those providers that Regional Extension Centers (RECs) to provide technical serve California’s underserved. assistance, disseminate best practices, and assist with implementations at the local level. Recommendation 17. CHHSA should define a set of eligibility requirements and performance criteria to Specifically, the Regional Extension Centers are charged operate as a REC in California and partner only with with providing technical and change-management those entities that meet state requirements to apply for assistance to health care providers in adopting and using federal funds. At a minimum, the eligibility requirements EHRs. They are to provide services to all providers in a should include extensive experience in successful EHR region, but must prioritize assistance to public, nonprofit, adoption and use, established relationships among and critical access hospitals; federally qualified health safety-net providers, and the capability to support health centers (FQHCs); rural or other providers that serve information exchange. uninsured, underinsured, or medically underserved patients; and individual or small group practices. Table 5 Recommendation 18. In coordination with the Health summarizes the key elements of the Health IT Regional IT Financing Advisory Commission, CHHSA should Extension Center grants. develop partnerships with public and private organizations to meet the federal requirement for matching funds. The state should consider using matching funds to meet state criteria and ensure coordination among the RECs. Table 5: Health IT Regional Extension Centers Funding Mechanism Federal appropriations Funding Entity The federal Department of Health and Human Services, through the Office of the National Coordinator (ONC) Allocation Process To be determined Matching Funds ONC may not provide more than 50 percent of the capital and annual operating and maintenance funds Requirement required to create and operate a Regional Extension Center. ONC may provide such funding for no longer than four years. Timing 2009 to 2011 Funds Flow Through ONC Eligible Recipients Nonprofits, likely to be broad array of competing applicants Level of Federal Funding To be determined Requirements for Funding To be determined 14  |  California HealthCare Foundation Workforce Training Grants Recommendations for California The effective use of health information technology Recommendation 19. The governor should direct the requires a team, and while physicians may provide the California Nurse Education Initiative to evaluate how to clinical oversight for patient care, its delivery depends apply for available funds and expand current programs on nurses, medical assistants, front office staff, and other to include allied health professionals and the integration clinical providers (such as nutritionists, behaviorists, of EHR and other technologies into existing training and social workers). In order for electronic health record programs. systems to fully support this team, its members must all have basic IT literacy, an understanding of state privacy Recommendation 20. The Community College laws and Health Insurance Portability and Accountability Chancellor’s Office should apply for funds to enhance Act (HIPAA) requirements, and the ability to make community college IT literacy programs with health- effective use of the EHR as part of their workflow. There specific training for allied health professionals. is a shortage of qualified allied health professionals in California, as well as a national shortage of health workers Recommendation 21. The University of California with IT literacy. Office of the President should apply for funds to incorporate EHRs into previously planned expansions in Table 6 summarizes the key elements of Workforce UC medical schools and teach EHR core competencies as Training Grants. The recommendations below are based defined by the American Medical Informatics Association on California’s extensive and diverse higher education and the American Health Information Management systems and build upon existing programs in medical Association. informatics at Stanford University, the University of California, Davis, and the University of California, San Francisco. Table 6. Workforce Training Grants Funding Mechanism Federal appropriations Funding Entity The federal Department of Health and Human Services (HHS), in consultation with National Science Foundation (NSF) Allocation Process Two types of competitive grants: (1) To colleges and institutions of higher education to expand medical health informatics programs, and (2) to medical schools to integrate EHRs into curricula. Matching Funds Requires 50 percent match (would only affect the state when the applicant is a University of California or state Requirement university campus, or a community college); match may be reduced with demonstrated economic conditions that render the cost-share requirement “detrimental to the program.” Timing To be determined Funds Flow Through HHS grant programs; identity of granting agency not yet clear Eligible Recipients •Institutions of higher education •Graduate health professional schools or programs (including medicine, osteopathy, nursing, dentistry, pharmacy, behavioral/mental health, or physician assistance studies) Level of Federal Funding To be determined Requirements for Funding Priority to existing education/training programs and those designed to be completed in less than six months. An Unprecedented Opportunity: Using the Federal Stimulus Package to Advance Health IT in California  |  15 New Technology Research and Development include representation from University of California, Grants California State University, federal laboratories, and The HITECH Act encourages the development of existing California-based research collaboratives such new health information technologies by establishing as CITRIS (Center for Information Technology Health Care Information Enterprise Integration Research in the Interest of Society), QB3 (CA Research Centers. The goal is to generate innovative Institute for Quantitative Biosciences), CNSI (CA approaches to enterprise integration by conducting Nanosystems Institute), and CalIT2 (CA Institute for “cutting-edge” research, including: interfaces between Telecommunications and Information Technology). human information and communications technology systems; voice-recognition systems; software that Broadband Technology Opportunities improves interoperability and connectivity among health Program information systems; software dependability in systems In addition to the HITECH Act, the ARRA instructs the that are essential for care delivery; health information Assistant Secretary of Commerce for Communications enterprise management; health information technology and Information, in consultation with the Federal security and integrity; and measurement of the impact of Communications Commission (FCC), to establish a information technologies on the quality and productivity national broadband service development and expansion of health care. Key elements are summarized in Table 7. program, referred to as the Broadband Technology Opportunities Program. The program is designed to Recommendation for California complement and enhance, not conflict with, other federal Recommendation 22. The governor should create broadband initiatives and programs. Key elements are an inter-disciplinary task force to recommend the summarized in Table 8. composition, location, and funding strategy for one or more Health Care Information Enterprise Integration Recommendations for California Research Centers. The task force should consider how These recommendations take into account the important these centers would complement current public and foundation of broadband access among California’s private sector research efforts. The task force should providers made possible through the FCC Rural Health Table 7. New Technology Research and Development Grants Funding Mechanism Federal appropriations Funding Entity National Institute of Standards and Technology (NIST) in consultation with National Science Foundation (NSF) Allocation Process Competitive grants Matching Funds Requirement 50 percent from third parties, not necessarily states Timing To be determined Funds Flow Through NIST in consultation with NSF Eligible Recipients Higher education institutions and/or federal government laboratories Level of Federal Funding To be determined Requirements for Funding Eligible entities include institutions of higher education, or consortia thereof, which may include nonprofit entities and federal government laboratories; grants are designed to fund up to 50 percent of the total cost of the project. 16  |  California HealthCare Foundation Table 8. Summary of Funding Requirements for Broadband Opportunity Program Funding Mechanism Federal appropriations Funding Entity Department of Commerce in conjunction with the Federal Communications Commission Allocation Process Competitive grants Matching Funds Requirement Federal share may not exceed 80 percent (unless a waiver is obtained) Timing All awards made by the end of FY 2010; projects must be completed within two years of the award. Funds Flow Through Department of Commerce or designated grantor Eligible Recipients State government; nonprofit organization (corporation, foundation, association or institution); or any other entity, including a broadband service provider, that the grantor deems to be working in the public interest. Level of Federal Funding Not less than $250,000,000 Requirements for Funding To be determined as RFP/grant process is defined Care Pilot Program. More than 700 California sites Authors qualified for the program’s broadband subsidies, and This issue brief was prepared by the California HealthCare it is expected that these sites will be connected as early Foundation with support from Manatt Health Solutions, as late summer 2009. Complementary support for a division of Manatt, Phelps & Phillips, LLP; and Robert Mittman, Facilitation, Foresight, Strategy. network operations, monitoring, and site implementation and training through the Broadband Technology Opportunities Program would allow California to move much more quickly to establish a robust, sustainable network. Recommendation 23. The California Telehealth Network (CTN) should apply for funds to complement the FCC award under the rural broadband access program; this application should be made a priority by CTN member organizations and the state. Recommendation 24. CHHSA and CTN should encourage health care providers participating in the CTN to identify support needs and apply for appropriate funding. An Unprecedented Opportunity: Using the Federal Stimulus Package to Advance Health IT in California  |  17 About the F o u n d at i o n The California HealthCare Foundation is an independent philanthropy committed to improving the way health care is delivered and financed in California. By promoting innovations in care and broader access to information, our goal is to ensure that all Californians can get the care they need, when they need it, at a price they can afford. For more information, visit www.chcf.org. A Focus on Health Information Technology For the past ten years CHCF has worked to accelerate the adoption and effective use of new information technologies in health care. One emphasis has been to assist public and private health care organizations realize the potential of the Internet for improving clinical care and business practices through better communication and access to information. this work has included: •Designing, building, and promoting the adoption of applications that streamline enrollment processes and improve access to care. •Developing and implementing data standards and automated information processes that support improvements in care delivery for people with chronic diseases. •Promoting policy and practice improvements to protect the privacy and security of personal health information. •Developing a prototype for secure community-wide health information sharing. •Promoting the use of electronic health records and supporting Pay for Performance as one mechanism to better align financial incentives for care improvements. •Supporting the development and prototyping of a consumer- focused personal health record to securely access and control health care information by making it more portable. •Researching and reporting on new developments and trends in the use of Internet and other information technologies to improve the quality and safety of care. •Publication of iHealthBeat, a free daily digest reporting on technology’s impact on health care  18  |  California HealthCare Foundation Glossary among departments to foster multidisciplinary studies; American Recovery and Reinvestment Act of 2009 creates research teams consisting of members who can (ARRA): a $787.2 billion stimulus measure, signed by be located anywhere because of the Internet; supports President Obama on February 17, 2009, that provides involvement by faculty, students, industry, government, aid to states and cities, funding for transportation and and community partners; enables prototyping in Calit2 infrastructure projects, expansion of the Medicaid “living laboratories”; and provides technical professionals program to cover more unemployed workers, health IT as the bridge between academia and industry. funding, and personal and business tax breaks, among other provisions designed to “stimulate” the economy. California NanoSystems Institute (CNSI): a research center at UCLA whose mission is to encourage university California Department of Health Care Services collaboration with industry and to enable the rapid (DHCS): the Department within the California commercialization of discoveries in nanosystems. Health and Human Services Agency that finances and administers Medi-Cal, the California Children’s Services California Telehealth Network (CTN): a coalition of program, the Child Health and Disability Prevention health care and technology stakeholders that is working program, and the Genetically Handicapped Persons to increase access to acute, primary, and preventive Program. health care in rural California and is responsible for administering $22.1 million in funding obtained from California Health and Human Services Agency the Federal Communications Commission to promote (CHHSA): the state-level agency that administers the telehealth. state’s programs for health care, social services, public assistance, and rehabilitation. Center for Information Technology Research in the Interest of Society (CITRIS): a multidisciplinary California Health Information Technology Finance research institute that facilitates partnerships and Advisory Commission: established by Governor collaborations among more than 300 faculty members Schwarzenegger to determine the extent to which and thousands of students from numerous departments limited access to capital impedes the adoption and at four UC campuses (Berkeley, Davis, Merced, and implementation of health IT in various health care sectors Santa Cruz) with industrial researchers from over 60 in California. corporations. CITRIS performs extensive research in information technology, from monitoring the California Institute for Quantitative Biosciences environment and finding viable, sustainable energy (QB3): a cooperative effort among three campuses alternatives to simplifying health care delivery and of the University of California and private industry developing secure systems for electronic medical records designed to harness the quantitative sciences to integrate and remote diagnosis. understanding of biological systems at all levels of complexity — from atoms and protein molecules to cells, Centers for Medicare and Medicaid Services (CMS): tissues, organs, and the entire organism. a federal agency within the United States Department of Health and Human Services that administers the California Institute for Telecommunications and Medicare program and works in partnership with state Information Technology (Calit2): a program of the governments to administer Medicaid, the State Children’s University of California that builds horizontal links An Unprecedented Opportunity: Using the Federal Stimulus Package to Advance Health IT in California  |  19 Health Insurance Program (SCHIP), and health insurance funded by the federal government under Section 330 of portability standards. the Public Health Service Act. Certification Commission for Healthcare IT Health Information Exchange (HIE): as defined (CCHIT): a recognized certification body (RCB) for by the Office of the National Coordinator and the electronic health records and their networks, CCHIT National Alliance for Health Information Technology is an independent, voluntary, private-sector initiative, (NAHIT), Health Information Exchange means the established by the American Health Information electronic movement of health-related information Management Association (AHIMA), the Healthcare among organizations according to nationally recognized Information and Management Systems Society (HIMSS), standards. and The National Alliance for Health Information Technology. Health Information Technology (HIT): as defined in the ARRA, Health Information Technology means Congressional Budget Office (CBO): a congressional hardware, software, integrated technologies or related agency whose mandate is to provide Congress with licenses, intellectual property, upgrades, or packaged objective, nonpartisan, and timely analyses to aid in solutions sold as services that are designed for or economic and budgetary decisions on the wide array support the use by health care entities or patients for the of programs covered by the federal budget, and the electronic creation, maintenance, access, or exchange of information and estimates required for the Congressional health information. budget process. Health Information Technology for Economic and Federal Communications Commission (FCC): the Clinical Health (HITECH) Act: collectively refers to United States government agency charged with regulating the health information technology provisions included at interstate and international communications by radio, Title XIII of Division A and Title IV of Division B of the television, wire, satellite, and cable. ARRA. Federal Financial Participation (FFP): the percentage Health Information Technology Research Center of EHR adoption incentive funding set out in the (HITRC): as set out in the ARRA, the Health stimulus package that will be provided by the federal Information Technology Research Center will be created government (as opposed to states) under the Medicaid by the Office of the National Coordinator to provide program. technical assistance and develop or recognize best practices to support and accelerate efforts by health care Federally Qualified Health Centers (FQHCs): safety- providers to adopt, implement, and effectively use health net providers such as community health centers, public information technology that allows for the electronic housing centers, outpatient health programs funded by exchange of information. the Indian Health Service, and programs serving migrants and the homeless. FQHCs provide their services to all [Health Information Technology] Regional Extension people regardless of ability to pay, and charge for services Centers (RECs): as set out in the ARRA, Health on a community board approved sliding-fee scale that is Information Technology Regional Extension Centers will based on patients’ family income and size. FQHCs are be created by ONC to provide technical assistance and disseminate best practices and other information learned 20  |  California HealthCare Foundation from the Health Information Technology Research Center Medicare Fee-for-Service (FFS): Medicare’s traditional to aid health care providers with the adoption of health benefit option, under which beneficiaries may obtain care information technology. from any licensed provider willing to accept Medicare patients. Health Information Technology Standards Panel (HITSP): a cooperative partnership between the Medi-Cal’s Medicaid Management Information public and private sectors formed for the purpose of System (MMIS): the fiscal intermediary which is used to harmonizing and integrating standards that will meet process over 220 million health care claims a year. clinical and business needs for sharing information among organizations and systems. National Association of State Medicaid Directors (NASMD): a bipartisan, professional, nonprofit Health Insurance Portability and Accountability Act organization of representatives of state Medicaid agencies (HIPAA): enacted by Congress in 1996. Title I of HIPAA (including the District of Columbia and the territories). protects health insurance coverage for workers and their The primary purpose of NASMD is to serve as a focal families when they change or lose their jobs. Title II point of communication between the states and the of HIPAA, known as the administrative simplification federal government and to provide an information (AS) provisions, requires the establishment of national network among the states on issues pertinent to the standards for electronic health care transactions and Medicaid program. national identifiers for providers, health insurance plans, and employers. The AS provisions also address the National eHealth Collaborative (NeHC): a public- security and privacy of health data. The standards are private partnership (formerly AHIC Successor, Inc.) meant to improve the efficiency and effectiveness of the driving the development of a secure, interoperable, nation’s health care system by encouraging the widespread nationwide health information system. The National use of electronic data interchange. eHealth Collaborative was founded in 2008 to build on the accomplishments of the American Health Information Meaningful EHR User: as set out in the ARRA, a Community (AHIC). meaningful EHR user meets the following requirements: use of a certified EHR technology in a meaningful National Institute of Standards and Technology manner, which includes the use of electronic prescribing; (NIST): the non-regulatory federal agency within use of a certified EHR technology that is connected in a the United States Department of Commerce whose manner that provides for the electronic exchange of health mission is to promote U.S. innovation and industrial information to improve the quality of health care; and competitiveness by advancing measurement science, use of a certified EHR technology to submit information standards, and technology. NIST oversees the NIST on clinical quality and other measures as selected by the Laboratories, the Baldrige National Quality Program, the Secretary of HHS. Hollings Manufacturing Extension Partnership, and the Technology Innovation Program. Medicare Advantage Plans: health plans offered by private companies that contract with Medicare to provide National Science Foundation (NSF): an independent beneficiaries with Medicare Part A and Part B benefits. federal agency created by Congress in 1950 “to promote Medicare Advantage Plans are HMOs, PPOs, or private the progress of science; to advance the national health, fee-for-service plans. prosperity, and welfare; to secure the national defense…,” An Unprecedented Opportunity: Using the Federal Stimulus Package to Advance Health IT in California  |  21 NSF is the funding source for approximately 20 percent under Section 3013 of the ARRA; be a nonprofit entity of all federally supported basic research conducted with broad stakeholder representation on its governing by America’s colleges and universities, including board; demonstrate that one of its principal goals is mathematics, computer science, and the social sciences. to use information technology to improve health care quality and efficiency through the authorized and secure Nationwide Health Information Network (NHIN): electronic exchange and use of health information; is envisioned by ONC to serve as a secure, nationwide, adopt nondiscrimination and conflict of interest policies interoperable health information infrastructure that will that demonstrate a commitment to open, fair, and connect providers, consumers, and others involved in nondiscriminatory participation by stakeholders; and supporting health and health care. conform to other requirements as specified by HHS. Office of the National Coordinator (ONC): serves U.S. Department of Health and Human Services as principal advisor to the Secretary of HHS on the (HHS): the federal government agency responsible for development, application, and use of health information protecting the health of all Americans and providing technology; coordinates HHS’s health information essential human services. HHS, through CMS, technology policies and programs internally and with administers the Medicare (health insurance for elderly and other relevant executive branch agencies; develops, disabled Americans) and Medicaid (health insurance for maintains, and directs the implementation of HHS’ low-income people) programs, among others. strategic plan to guide the nationwide implementation of interoperable health information technology in both the public and private health care sectors, to the extent permitted by law; and provides comments and advice at the request of OMB regarding specific federal health information technology programs. ONC was established within the Office of the Secretary of HHS in 2004 by Executive Order 13335. Qualified Electronic Health Record (EHR): as defined in the ARRA, a qualified electronic health record (EHR) means an electronic record of health-related information on an individual that includes patient demographic and clinical health information, such as medical histories and problem lists, and has the capacity to: provide clinical decision support; support physician order entry; capture and query information relevant to health care quality; and exchange electronic health information with, and integrate such information from, other sources. Qualified State-Designated Entities (SDEs): as defined in the ARRA, [Qualified] state-designated entities (SDEs) shall be designated by a state as eligible to receive grants 22  |  California HealthCare Foundation