Study examines the ‘haves and have-nots’ of health information exchanges

Health information exchanges increase patient referrals among participating doctors, but that increase may come at the expense of doctors who aren’t part of the exchange, according to a new study from the School of Management.

Soon in Management Sciences, research analyzes the impact of health information exchange on patient referral patterns. Referrals are an important part of the US healthcare system, with more than a third of all patients referred to specialists each year.

“Referrals have a significant impact on the cost and quality of healthcare services,” says Ram Ramesh, professor of science and management systems. “In the context of referrals, the exchange of health information tends to divide the physician community into ‘tech savvy and have-nots’, where those who participate benefit from increased referrals among themselves at the expense of those who have not joined an exchange. ”

Health information exchanges allow physicians to digitally access and share their patients’ medical data. These platforms have been an integral part of the American healthcare system since the adoption in 2009 of the Health Information Technology for Economic and Clinical Health Act.

“The concept of health information exchange was born out of a federal mandate, so it’s different from other innovations because of how it was created, supported, and developed,” says Ramesh. “As a result, there was no immediate and dramatic change in referrals when the exchanges were launched, but over time they should bring significant benefits to patients and insurance companies by improving quality and reducing the cost of health care.”

The researchers analyzed publicly available data sets of every Medicare beneficiary, totaling about 22,000 in Western New York from 2009 to 2012. They conducted econometric analysis – using statistical methods to transform economic models into useful tools for policy-making – to examine patient referral data over time and to study how the adoption of health information exchange affected referral behaviors among physicians community.

Based on their findings, the researchers claim that joining an exchange results in a 44% to 46% increase in referrals to and from other members.

“To ensure the quality of the referral service and, therefore, to be able to maintain and increase their volume of business, providers need to be more aware of the benefits of joining an exchange – and the possible loss of patients they face if they don’t join it,” Ramesh said.

Furthermore, according to Ramesh, the results show that it will be important for exchanges to communicate the value they bring to their members – and the potential risks of not signing up. “Such communication is critical to the growth and sustainability of regional health information exchange,” he says.

Ramesh collaborated on the study with School of Management PhDs Saeede Eftekhari, PhD ’19, assistant professor of management science at Tulane University Freeman School of Business; Ram Gopal, PhD ’94, Distinguished Fellow of the Information Systems Society and Professor of Information Systems and Management at Warwick Business School; and Niam Yaraghi, PhD ’14, assistant professor of business technology at Miami Herbert Business School and nonresident senior fellow at the Brookings Institution.