Publications / Why California Needs Better Data Exchange: Challenges, Impacts, and Policy Options for a 21st Century Health System

Why California Needs Better Data Exchange: Challenges, Impacts, and Policy Options for a 21st Century Health System

Note: The final version of this report was posted on March 1, 2021.

Advancing Data Exchange in California

This collection of reports sponsored by CHCF is aimed at helping inform California decisionmakers about statewide data exchange.

The efficient, effective, and equitable delivery of care is vital to the well-being of all Californians and is necessary for a strong and vibrant economy. To achieve this state, information must easily be exchanged among medical, behavioral, social services, and public health professionals to allow them to make informed decisions that impact the lives of every resident.

Today, access to this kind of critical information is limited, with the exchange of health data confined to a subset of clinical patient information shared mostly among larger clinics and hospitals that have federally certified electronic health record (EHR) technologies. The health information exchange (HIE) ecosystem across California is composed of a combination of direct exchange between providers, the use of national networks, and over 15 regional health information organizations (HIOs). This fragmented model delivers inconsistent and incomplete solutions that don’t provide all the critical information needed to care for the state’s residents, don’t provide access to all the service providers who need data, and don’t scale to provide state health care leaders with the access to data they need. Coupled with restrictive, confusing, and ambiguous data exchange rules, the exchange environment does not and cannot adequately enable initiatives to improve care quality; enhance access to medical, social, and public health services; reduce disparities; and lower costs for residents, counties, and the state.

For an overview of California’s HIE ecosystem and context on the different types of HIE, please see the recent CHCF publication Health Information Exchange in California: Overview of Network Types and Characteristics.

To address the shortcomings of the current HIE environment in California, three key data exchange issues need to be resolved:

  • Clinical data fragmentation. A range of issues results in incomplete and isolated islands of patient data being available through California’s current HIE ecosystem. These include a lack of full provider participation in HIE in communities served by regional HIOs, inclusion of only a subset of EHR data shared through exchanges, inconsistent participation in regional and national exchanges, inconsistent sharing between national and regional exchanges, and an array of private, exclusionary direct exchange solutions. Further, this fragmentation creates inequities in how data are accessed. There are voids in HIE network coverage in many California counties — disproportionately rural and underserved communities that often find adopting and using EHR technology to share data prohibitively expensive — generally excluding them from the benefits of HIE and leaving significant gaps in available data. The issue of fragmentation results in incomplete data sharing, creates complexity, and restricts access and use of critical data, limiting the value of the exchange platforms and eroding confidence in their completeness.
  • Exclusion of exchange sectors. Regional HIOs and national networks were developed to support clinical data exchange. By and large, they do not support the broader requirements associated with organizing and delivering comprehensive clinical, behavioral, social, and emergency services for California’s residents. By omitting payers and purchasers, public health, social service, behavioral health, and in most cases, emergency response providers, HIOs and national networks are not able to capture and deliver critical information vital to addressing inherent inequities in access, outcomes, and social determinants of health. As a result, providers caring for California’s underresourced populations cannot see and meet all their complex needs. Additionally, the lack of adequate data sharing among all health care stakeholders, including consumers and public and private payers, restricts their ability to use information to make informed decisions or to design new programs that would drive down cost while improving outcomes. Further, many of these sectors, especially social services, behavioral health services, and even public health departments, lack the modernized data infrastructure that enables electronic data capture and interoperability.
  • Complex and onerous data exchange rules and regulations. There are a range of restrictive, confusing, and ambiguous state and federal laws and rules that govern different types of data access and exchange. As a result, stakeholders are prevented from using and maximizing the value of available data. Worse yet, many elect not to participate in data exchange, fearing liability and the consequences associated with not adhering to privacy regulations they don’t fully understand.

These three core data exchange issues are evident every day when physical, behavioral health, and social service providers, and public health and emergency response agencies seek to organize and deliver services. To better appreciate how these issues directly affect the lives of California’s residents, over a dozen interviews were conducted with leaders from state and local agencies; payers; social, behavioral, and clinical care providers; health care purchasers; emergency response organizations; HIE providers; and other key stakeholders. The purpose was to gain an understanding of how data exchange issues affect their ability to deliver critical services, and importantly, the impact these issues have on the people they serve. This report summarizes the views represented through these interviews, along with supporting research and insights gained through a review of other state HIE programs.

About the Authors

This paper was authored by Jonah Frohlich and Eric Bartholet, managing directors, and Jonathan DiBello, consultant, at Manatt Health. Manatt Health integrates legal and consulting expertise to better serve the complex needs of clients across the health care system. Combining legal excellence, firsthand experience in shaping public policy, strategy insight, and deep analytic capabilities, Manatt Health provides professional services to the full range of health industry players. This diverse team of more than 160 attorneys and consultants from Manatt, Phelps & Phillips and its consulting subsidiary, Manatt Health Strategies, helps clients advance their business interests, fulfill their missions, and lead health care into the future. For more information, visit

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