California Foundation Enables Bold Step in Health Care Improvement

In an unprecedented move, leaders from throughout California’s businesses and health care industry have joined forces to establish standards and a strategy to create an advanced data communications infrastructure for health care. No other state in this country has begun such a bold effort of this scale to improve quality of care.

The effort will be greatly aided by a $1.2 million grant awarded by the California HealthCare Foundation to the Pacific Business Group on Health (PBGH) and the National IPA Coalition (NIPAC) to organize and administer the process.

The grant will enable purchasers, health plans, and providers to improve the flow of information throughout the health care delivery system in California. “Consumers will be the major beneficiaries,” said Peter Wald, M.D., of ARCO and chairman of the PBGH Data Committee. “Because of this effort, doctors will get better information faster, patients will be able to make more informed health care decisions with their doctors, and patients will be able to make more informed health care decisions with their doctors, and patients and purchasers both will see what value they are getting for there money.”

Health care continues to generate tremendous amounts of paper, relying on manual labor that results in costly delays, duplication of effort, and unsatisfactory service. The project will develop high-speed electronic data communications among physicians, health plans, and purchasers, speeding transmission of essential information. Data concerning health plan eligibility, coverages, and benefits, appointments and encounters, treatment protocols and technical bulletins, lab tests, drug interactions, health plan performance, and quality indicators are examples.

The health care information infrastructure project, which came together in later 1996, is a broad-based effort among California businesses, physician organizations, health plans, hospitals and affiliated health care systems that have agreed to collaborate on standards, cooperate on implementation, and compete on quality. Besides PBGH and NIPAC, other organizations involved in the project include the California Association of Health Plans (CAHP), American Medical Group Association (AMGA), California Medical Association (CMA), and the California Healthcare Association (CHA). “Our board is solidly behind this effort to move from existing closed, proprietary information systems that have difficulty communicating with one another to a more open, collaborative model that will facilitate the flow of needed information in health care,” said Arthur Southam, M.D., chairman of the CAHP Board of Directors and president and CEO of Health Net.

The first step is to agree on a common set of data standards for patient eligibility, pharmacy, laboratory and clinical encounter records. Distinct work groups are being formed around each of these areas. Once standards are implemented, health plans and providers can electronically network with each other through an electronic data interchange (EDI). A special consumer advisory council will review work group recommendations to ensure that they include appropriate safeguards to protect patient confidentiality.

“We have an overriding responsibility to protect the confidentiality of patients’ medical information,” said Jack Lewin, M.D., CEO of CMA. “While protecting the confidentiality, we also have an equally important responsibility to look carefully at the effects of our care, what quality we provide and how we can improve that quality even more.

The grant is for the first phase of a three-year effort. It will enable PBGH and NIPAC to maintain momentum on the project, working collaboratively with other stakeholders to reach agreement on standards and their implementation. In addition, the grant will support the hiring of staff and expert consultants by PBGH and NIPAC to help guide and inform the project. Significant resources will also be provided by health plans and providers as they update their system to conform to the common standards and implement EDI. The participants hope to achieve measurable improvements in the quality of health care information for California.

About the California Health Care Foundation

The California Health Care Foundation is dedicated to advancing meaningful, measurable improvements in the way the health care delivery system provides care to the people of California, particularly those with low incomes and those whose needs are not well served by the status quo. We work to ensure that people have access to the care they need, when they need it, at a price they can afford.