Failed Santa Barbara RHIO offers lessons learned
The failed healthcare data exchange project in Santa Barbara County, Calif., offers some lessons for future health information exchanges, according to David Brailer, who helped develop the project before becoming the first national coordinator for health IT, according to an article published in Technology Daily.

The project, widely considered to be one of the first successful RHIOs, was designed to connect healthcare organizations in Santa Barbara County and allow them to securely share clinical and administrative information. Speaking on the subject this week, Brailer said that the business model is the “great limiting” factor for many RHIOs.

In 1997, Brailer, then CEO of CareScience, proposed a demonstration project to develop a secure method of electronically sharing patient data among providers. The California HealthCare Foundation in 1999 awarded the company and Santa Barbara County officials a $10 million grant to build a system that could be replicated nationally.

However, the project disbanded in 2006 because technology delays, uncertainty over privacy and liability issues, and concerns about the value of the effort made participating organizations reluctant to invest in the exchange.

Brailer and Sam Karp, vice president of programs for CHCF, said outright subsidies for health IT projects likely undermine progress.

In the Santa Barbara effort, "subsidies were beneficial" because participants "did not need to have the organizational readiness, co-investment or know-how to get involved," Brailer writes in his Health Affairs paper. "It was bad for the same reason. Santa Barbara providers had nothing at risk. ... They bore no cost for the philanthropic capital and faced no adverse consequences for how it was spent," Brailer wrote.

Because of his experience with the Santa Barbara project, Brailer opposed federal subsides during his tenure as the national coordinator for health IT, instead supporting the idea that market forces should be allowed to work, Technology Daily reports.

Brailer said that federal rules should mobilize financial capital for health IT, offer accountability mechanisms and require funding that matches know-how to lower risk.