Health Organizations: Dedicated State Funding Stream Needed to Support the Broad Exchange of Health Information in California

California health care providers, health plans and other health organizations are asking that the 2022-23 California state budget include a $100 million general fund allocation to secure a dedicated funding stream to support efforts for the broad exchange of health information across the health care ecosystem.

Felix Su, Director, Health Policy, for Manifest MedEx, reported to the Connecting for Better Health Coalition at its recent meeting that several organizations cosigned a letter with the budget request to Governor Newsom and state legislative leaders and finance officials. The funding is critical to “accelerate Medi-Cal provider data-sharing and build the data infrastructure needed to deliver on our commitment to improve Medi-Cal quality, address longstanding equity concerns, and make the promise of whole person care a reality,” the letter states.

State officials have suggested that necessary funding to support the data exchange framework may be included in the Governor’s May revised budget, which prompted the letter.

Su said the groups are encouraging the $100 million investment for two interconnected programs: establishing incentives for providers to participate in a qualified health information exchange (HIE), and enabling qualified health information organizations to provide infrastructure to support CalAIM and other Medi-Cal priorities.

The first part of the request would give providers such as hospitals, physicians, clinics, nursing homes, and behavioral health providers support to participate in health data sharing and to “actively, robustly try to improve the quality and consistency of that data,” Su said. The incentive program funding would be matched with federal funds and administered by Medi-Cal plans in every county, according to the proposal in the letter.

Su pointed to incentive programs that have had success in other states with health information exchanges, including Arizona and Michigan, as well as the Inland Empire Health Plan in California. “Experience from other states and from within California demonstrates that financial incentives can rapidly accelerate HIO participation and data sharing,” the letter states.

The second part of the request asks state policymakers to commit state budget funds to leverage enhanced federal funding that is available for states’ Medicaid technology systems to support qualified HIEs as data infrastructure for Medi-Cal.

“It’s not just about the variable costs of establishing the data feeds, but also the ongoing fixed cost structure of maintaining data warehouses, data management, and background processes that keep the proverbial lights on,” Su said.

“California has committed over $2.6 billion in state funds for this sweeping set of Medi-Cal delivery system reforms [through CalAIM]. But that commitment will falter without the timely clinical and other health data needed to coordinate care, improve quality, fill prevention gaps, identify high-risk patients and address disparities,” the letter states.


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