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Report to the Chairman, Committee on the Budget, House of 
Representatives: 

May 2005: 

Health Information Technology: 

HHS Is Taking Steps to Develop a National Strategy: 

GAO-05-628: 

GAO Highlights: 

Highlights of GAO-05-628, a report to the Chairman, Committee on the 
Budget, House of Representatives: 

Why GAO Did This Study: 

To prevent medical errors, reduce costs, improve quality, and produce 
greater value for health care expenditures, President Bush has called 
for the Department of Health and Human Services (HHS) to develop and 
implement a strategic plan to guide the nationwide implementation of 
health information technology (IT) in both the public and private 
health care sectors. The Departments of Defense (DOD) and Veterans 
Affairs (VA), along with other countries, have already taken steps to 
improve health care delivery and administration by implementing IT 
solutions. GAO was asked to provide an overview of HHS’s recent efforts 
to develop a national health IT strategy for realizing the President’s 
vision, and to identify lessons learned from DOD’s, VA’s, and other 
countries’ experiences in implementing health IT.

What GAO Found: 

The Secretary of HHS appointed the National Coordinator for Health IT 
in May 2004. In July 2004, the national coordinator released a 
framework for strategic action, which outlines four goals and 12 
strategies to guide the development of a full strategic plan for 
national health IT adoption (see table below). The framework builds 
upon already-existing work in federal health IT and includes plans to 
identify and learn from agencies’ experiences. It also describes 
actions to be taken by both the public and private sectors to achieve 
interoperability in health IT across the nation. 

HHS plans to address the goals and strategies of the framework with a 
three-phased approach over a number of years and is currently 
implementing phase I of the framework. However, HHS has not established 
milestones for the completion of phase I activities nor has it made 
detailed plans or set milestones for the completion of activities for 
phases II and III. 

Goals and Strategies of HHS’s Framework for Strategic Action: 

Goals: Goal 1: Inform clinical practice with the use of electronic 
health records (EHR); 
Strategies[A]: 1. Incentivize EHR adoption. 

Goals: Goal 1: Inform clinical practice with the use of electronic 
health records (EHR); 
Strategies[A]: 2. Reduce risk of EHR investment. 

Goals: Goal 1: Inform clinical practice with the use of electronic 
health records (EHR); 
Strategies[A]: 3. Promote EHR diffusion in rural and underserved areas. 

Goals: Goal 2: Interconnect clinicians so that they can exchange health 
information using advanced and secure electronic communication; 
Strategies[A]: 1. Foster regional collaboration. 

Goals: Goal 2: Interconnect clinicians so that they can exchange health 
information using advanced and secure electronic communication; 
Strategies[A]: 2. Develop a national health information network. 

Goals: Goal 2: Interconnect clinicians so that they can exchange health 
information using advanced and secure electronic communication; 
Strategies[A]: 3. Coordinate federal health information systems. 

Goals: Goal 3: Personalize care with consumer-based health records and 
better information for consumers; 
Strategies[A]: 1. Encourage use of personal health records. 

Goals: Goal 3: Personalize care with consumer-based health records and 
better information for consumers; 
Strategies[A]: 2. Enhance informed consumer choice. 

Goals: Goal 3: Personalize care with consumer-based health records and 
better information for consumers; 
Strategies[A]: 3. Promote use of telehealth systems. 

Goals: Goal 4: Improve public health through advanced biosurveillance 
methods and streamlined collection of data for quality measurement and 
research; 
Strategies[A]: 1. Unify public health surveillance architectures. 

Goals: Goal 4: Improve public health through advanced biosurveillance 
methods and streamlined collection of data for quality measurement and 
research; 
Strategies[A]: 2. Streamline quality and health status monitoring. 

Goals: Goal 4: Improve public health through advanced biosurveillance 
methods and streamlined collection of data for quality measurement and 
research; 
Strategies[A]: 3. Accelerate research and dissemination of evidence. 

Source: HHS. 

[A] Phase I strategies are shown in bold type.

[End of table]

GAO identified lessons learned from DOD and VA that could provide 
valuable insight to HHS as it works toward implementing a national 
health IT infrastructure. DOD and VA operate the largest health care 
delivery networks in the nation, and important lessons can be taken 
from their experiences in health IT. Additionally, other countries have 
begun initiatives to establish national health IT infrastructures. DOD, 
VA, Canada, Denmark, and New Zealand provided GAO with valuable lessons 
learned that can be applied to the United States’s efforts. Among other 
lessons learned, they reported the need to 

* obtain the endorsement of top leadership, 
* define and adopt standards, 
* address the needs of stakeholders, and 
* deploy IT solutions in small increments and build on successes.

What GAO Recommends: 

To accelerate the adoption of interoperable IT for health care, GAO 
recommends that the Secretary of Health and Human Services establish 
and follow detailed plans and set milestones for each phase of HHS’s 
framework for strategic action.

In commenting on a draft of this report, DOD, HHS, and VA concurred 
with our results; HHS agreed with our recommendation. Technical 
comments were incorporated in this report as appropriate.

www.gao.gov/cgi-bin/getrpt?GAO-05-628.

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact David A. Powner, (202) 
512-9286, pownerd@gao.gov.

[End of section]

Contents: 

Letter: 

Recommendation for Executive Action: 

Agency Comments: 

Appendixes: 

Appendix I: National Health Information Technology Strategy: 

Appendix II: Comments from the Department of Health and Human Services: 

Appendix III: Comments from the Department of Veterans Affairs: 

Abbreviations: 

AHRQ: Agency for Health Research and Quality: 

CDC: Centers for Disease Control and Prevention: 

CHI: Consolidated Health Informatics: 

CMS: Centers for Medicare and Medicaid Services: 

DOD: Department of Defense: 

EHR: electronic health records: 

FDA: Food and Drug Administration: 

FHA: Federal Health Architecture: 

HHS: Department of Health and Human Services: 

HRSA: Health Resources and Services Administration: 

IHS: Indian Health Service: 

IT: information technology: 

NCVHS: National Committee on Vital and Health Statistics : 

NHIN: National Health Information Network: 

NIH: National Institutes of Health: 

ONCHIT: Office of the National Coordinator for Health IT: 

VA: Department of Veterans Affairs: 

Letter May 27, 2005: 

The Honorable Jim Nussle: 
Chairman, Committee on the Budget: 
House of Representatives: 

Dear Mr. Chairman: 

According to the Institute of Medicine, health care delivery in the 
United States has long-standing problems with medical errors and 
inefficiencies that increase health care costs. The U.S. health care 
delivery system is an information-intensive industry that is complex 
and highly fragmented with estimated spending of $1.7 trillion in 2003. 
In April 2004, President Bush announced a health information technology 
(IT) plan that calls for the development and implementation of a 
strategic plan to guide the nationwide implementation of health IT in 
both the public and private health care sectors to prevent medical 
errors, improve quality, and produce greater value for health care 
expenditures. 

Also in April 2004, the President issued an executive order that 
required the Secretary of Health and Human Services to appoint a 
national coordinator whose role is to provide leadership for the 
development and nationwide implementation of an interoperable health IT 
infrastructure to improve the quality and efficiency of health care. 
The National Coordinator for Health IT was appointed in May 2004; in 
July 2004, the coordinator released a framework for strategic action, 
the first step toward a national strategy. The framework builds upon 
already-existing work in federal health IT and includes plans to 
identify and learn from agencies' experiences, including those of the 
Departments of Defense (DOD) and Veterans Affairs (VA), which operate 
the largest health care delivery networks in the nation and have 
experience with developing and implementing IT solutions throughout 
their systems. Additionally, other countries have begun to develop and 
implement strategies to improve health care delivery through the 
nationwide adoption of IT and can provide valuable lessons for the 
Department of Health and Human Services (HHS). 

You asked us to (1) provide an overview of HHS's efforts to develop and 
implement a national health IT strategy, (2) identify lessons learned 
from DOD's and VA's experiences with implementing electronic health 
records, and (3) identify lessons learned from other countries' efforts 
to modernize health IT infrastructures. We conducted work at HHS, DOD, 
and VA--the federal agencies that play major roles in supporting and 
providing health care delivery in the United States and that are 
promoting the use of health IT. We reviewed and assessed HHS's 
framework and plans for developing a national health IT strategy to 
understand the role of the new office for national coordination of 
health IT. We supplemented our assessment by discussing with officials 
throughout the department their involvement in national efforts to 
implement health IT and the integration of current health IT 
initiatives into the national strategy. We analyzed DOD and VA 
documentation and prior GAO reports discussing the two departments' 
implementation of health IT (see app. I). We supplemented our analyses 
by discussing with DOD and VA officials the lessons that they learned 
from implementing health IT solutions in two of their major information 
systems. We selected examples of other countries' efforts to modernize 
health IT infrastructures based upon literature reviews and discussions 
with health care IT experts. We discussed with Canada, Denmark, and New 
Zealand their initiatives to modernize national health IT 
infrastructures and identified lessons learned from their experiences 
that could be meaningful to the United States's efforts. We conducted 
our work from October 2004 through March 2005, in accordance with 
generally accepted government auditing standards. 

On April 1, 2005, we provided your office with a briefing on the 
results of this review. The purpose of this letter is to provide the 
published briefing slides to you, which appear as appendix I. The 
information in these slides has been updated to include additional 
information requested by your office. 

In summary, we found that HHS, through the Office of the National 
Coordinator for Health IT, is taking initial steps toward developing a 
national strategy for health IT and has released a framework that 
describes actions to be taken by the public and private sectors to 
develop and implement such a strategy. The framework defines goals and 
strategies that are to be implemented in three phases. Phase I focuses 
on the development of market institutions[Footnote 1] to lower the risk 
of health IT procurement, phase II involves investment in clinical 
management tools and capabilities, and phase III supports the 
transition of the market to robust quality and performance 
accountability. 

HHS is in the initial phase of implementing activities to achieve the 
goals of the framework and, as a result, has made progress toward 
coordinating federal health IT efforts and reaching out to private 
industry. For example, in November 2004, the department issued a 
request for information seeking public input and ideas for developing a 
national health information network; a task force of federal agencies 
is evaluating over 500 responses to this request. HHS is also working 
with the private sector to develop standards and certification 
procedures for health IT interoperability. However, HHS has not 
established milestones for the completion of phase I, nor has it 
defined plans for phases II and III. Without defined milestones, it 
remains unclear when the important activities of phase I will be 
completed to provide the building blocks needed to support the 
activities of the subsequent phases. 

We identified lessons learned from DOD and VA that could provide 
valuable insight to HHS as it works toward implementing a national 
health IT infrastructure. DOD and VA operate the largest health care 
delivery networks in the nation, and important lessons can be taken 
from their experiences in health IT. Among other things, they reported 
the need to: 

* obtain full endorsement of top leadership,

* define and adopt common standards and terminology,

* recognize and address the needs of the varied stakeholder 
communities, and: 

* deploy in small increments and build on success. 

We also reported additional lessons learned from other countries' 
experiences in modernizing health IT infrastructures. Canada, Denmark, 
and New Zealand have begun initiatives to establish national health IT 
infrastructures with government support and identified lessons learned 
from their experiences, such as: 

* focus on creating standards first,

* establish a central organization to lead health IT efforts, and: 

* implement solutions incrementally. 

Recommendation for Executive Action: 

As a result of our work, we recommend that the Secretary of Health and 
Human Services establish detailed plans and milestones for each phase 
of the framework for strategic action and take steps to ensure that 
those plans are followed and milestones are met. 

Agency Comments: 

We received written comments on a draft of this report from the Acting 
Inspector General at HHS and the Deputy Secretary of VA. We received 
oral comments from the Chief Enterprise Architect for Military Health 
System at DOD. DOD, HHS, and VA concurred with our results and provided 
technical comments, which we have incorporated in this report as 
appropriate. HHS agreed with our recommendation and described 
additional actions that the Secretary is taking to achieve specific 
goals of the framework and to benefit from lessons learned from DOD and 
VA. HHS also provided additional information about the steps that the 
department is taking to lead the nation in health IT efforts. This 
information is provided in HHS's written comments, which are reproduced 
in appendix II. VA's written comments are reproduced in appendix III. 

We are sending copies of this report to the Chairmen and Ranking 
Minority Members of other Senate and House committees and subcommittees 
having authorization and oversight responsibilities for health care IT. 
We are also sending copies to the Secretary of Health and Human 
Services and to the other agencies that participated in our review. We 
will also make copies available to others upon request. In addition, 
the report will be available at no charge on the GAO Web site at 
[Hyperlink, http://www.gao.gov]. 

Should you or your office have any questions about matters discussed in 
this report, please contact Dave Powner at (202) 512-9286 or by e-mail 
at [Hyperlink, pownerd@gao.gov]. Contact points for our Offices of 
Congressional Relations and Public Affairs may be found on the last 
page of this report. Major contributors to this report also included 
Tonia D. Brown, Pamlutricia Greenleaf, M. Saad Khan, Valerie C. Melvin, 
Teresa F. Tucker, and Jessica D. Waselkow. 

Sincerely yours,

Signed by: 

David A. Powner: 
Director, Information Technology Management Issues: 

Signed by: 

Linda D. Koontz: 
Director, Information Management Issues: 

[End of section]

Appendixes: 

Appendix I: National Health Information Technology Strategy: 

National Health Information Technology Strategy: 

Briefing for Majority Staff: 
Committee on the Budget: 
House of Representatives: 

April 1, 2005: 

Updated: 

Table of Contents: 

Introduction: 

Objectives, Scope, and Methodology: 

Results in Brief: 

Background: 

National Health Information Technology Strategy: 

Lessons Learned from the Departments of Defense and Veterans Affairs: 

Lessons Learned from Other Countries: 

Conclusions: 

Recommendation: 

Agency Comments: 

Appendixes: 

Introduction: 

The United States health care delivery system is an information- 
intensive industry that is complex, inefficient, and highly fragmented, 
with estimated spending of $1.7 trillion in 2003. 

Calling for transformational change in the health care industry, the 
Institute of Medicine pointed out that health care delivery in the 
United States has longstanding problems with medical errors and 
inefficiencies that increase the cost of health care.[NOTE 1] 

The President's health care information technology (IT) plan calls for 
the development and implementation of a strategic plan to guide the 
nationwide implementation of interoperable health information 
technology in both the public and private health care sectors that will 
prevent medical errors, reduce costs, improve quality, and produce 
greater value for health care expenditures. 

NOTE: 

[1] Institute of Medicine, To Err Is Human: Building a Safer Health 
System (Washington, DC: November 1999) and Crossing the Quality Chasm: 
A New Health System for the 21st Century (Washington, D.C.: March 
2001). 

Objectives, Scope and Methodology: Objectives and Scope: 

Objectives: 

To provide an overview of the Department of Health and Human Services' 
(HHS) efforts to develop and implement a national health information 
technology strategy. 

To identify lessons learned from the Departments of Defense's (DOD) and 
Veterans Affairs' (VA) implementation of electronic health records 
(EHRs). 

To identify lessons learned from other countries' efforts to modernize 
health IT infrastructures. 

Scope: 

Conducted work at HHS components that play major roles in supporting 
health care IT, including the Agency for Healthcare Research and 
Quality, Centers for Medicare and Medicaid Services, Food and Drug 
Administration, Health Resources and Services Administration, Indian 
Health Service, National Institutes for Health, and Office of the 
National Coordinator for Health IT in Washington, D.C., and the Centers 
for Disease Control and Prevention in Atlanta, GA: 

Conducted work at DOD's Office of Health Affairs in Falls Church, VA 
and VA's Veterans Health Administration in Washington, D.C. 

Selected and reviewed examples of health care IT infrastructure 
initiatives from Canada, Denmark, New Zealand, and the United Kingdom. 

Objectives, Scope and Methodology: Methodology: 

Reviewed HHS's framework and implementation plans for developing a 
national health IT strategy and held discussions with agency officials 
about their involvement in national efforts to implement health IT and 
the integration of current health IT initiatives into the national 
strategy. 

Analyzed agency documentation and GAO reports discussing DOD's and VA's 
implementation of EHRs as part of the Composite Health Care System II 
and the Veterans Health Information System and Technology Architecture: 

* Supplemented analyses with interviews of DOD and VA officials 
regarding the agencies' practices, processes, and outcomes in 
implementing EHRs, and identified related lessons learned that could be 
useful in the implementation of a national health care system. 

* Consulted with a private health care consultant currently studying 
EHRs to assess the validity of the identified lessons and their 
applicability in federal and private health care settings. 

Conducted literature reviews of other countries' efforts to implement 
health IT and held discussions with officials in Canada, Denmark, and 
New Zealand to gain information about experiences related to costs, 
benefits, time frames, and challenges: 

* We held discussions with health care IT experts and reviewed 
literature to identify countries that are modernizing health IT 
infrastructures and were willing to discuss their initiatives and 
lessons learned with us. 

* We obtained information about the United Kingdom's health IT 
modernization project by reviewing publicly available documentation. 

We conducted our work from October 2004 through March 2005 in 
accordance with generally accepted government auditing standards. 

We collected systems descriptions and cost information from agency 
officials and did not independently verify data provided to us. 

We requested comments from HHS, DOD, and VA on a draft of these 
briefing slides. 

Results in Brief: 

In July 2004, HHS delivered a framework for strategic actions as a 
first step toward a strategy to implement a nationwide health IT 
infrastructure that involves both the public and private sectors' 
participation. 

* The framework builds upon ongoing work in federal health IT and 
includes plans to identify and learn from agencies' experiences. 

* The framework defines goals and strategies which are to be 
implemented in three-phases. 

HHS is in the initial phase of implementing the framework's strategies 
but has not defined milestones for completion of this phase or later 
phases. 

In November 2004, HHS issued a request for information seeking public 
input and ideas for developing a national health information network; a 
task force of federal agencies is evaluating over 500 responses. 

DOD and VA operate the largest health care delivery networks in the 
nation, and their experiences in implementing EHRs offer important 
lessons learned that could be applied to a national health records 
system. These lessons include: 

* Obtain full endorsement of top leadership: 

* Define and adopt common standards and terminology: 

* Recognize and address needs of the varied stakeholder communities: 

* Deploy in small increments and build on success: 

Other countries have begun initiatives to establish national health IT 
infrastructures with government support and also provided valuable 
lessons learned that can be applied to the U.S.'s efforts, such as: 

* Focus on creating standards first; 

* Establish a central organization to lead health IT efforts; 

* Implement incrementally. 

As a result of our review, we recommend that HHS establish plans and 
milestones for fully implementing its framework for strategic action. 

Background: IT in the Health Care Industry: 

The President's Information Technology Advisory Committee[NOTE 2] 
observed that, unlike most industries in which IT has improved 
efficiency, quality, and productivity, health care still operates using 
primarily paper-based records, phone calls, faxes, and mail. 

* Unlike the nationalized health systems of many countries, the U.S. 
health care system is composed of private, independent hospitals, 
ambulatory care and long-term care facilities, and private individual 
and group provider practices. 

* The free market system does not inherently generate practical 
mechanisms for sharing information critical to patient care. 

According to HHS, health care is the largest sector of the economy that 
has not fully embraced information technology. 

Health IT is used to support health care quality and efficiency by 
providing tools to improve patient care and to reduce administration 
overhead. For example: 

* Electronic health records (EHRs)[NOTE 3] provide patients and their 
caregivers the necessary information required for optimal care while 
reducing costs and administrative overhead, such as that associated 
with patient registration, admission, discharge, and billing. 

* Computer-assisted clinical decision support tools increase the 
ability of health care providers to take advantage of current medical 
knowledge from online medical references as they make treatment 
decisions. 

* Computerized provider order entry allows providers to electronically 
order tests, medicine, and procedures for patients, reducing errors 
associated with hand-written orders and prescriptions. 

* Telehealth is used to provide health care to rural and remote areas 
through the use of communications technologies. 

NOTES: 

[2] The President's Information Technology Advisory Committee's members 
are appointed by the President to provide independent expert advice on 
IT. 

[3] There is a lack of consensus on what constitutes an EHR, and thus 
multiple definitions and names exist for EHRs, depending on the 
functions included. An EHR generally includes (1) a longitudinal 
collection of electronic health information about the health of an 
individual or the care provided, (2) immediate electronic access to 
patient-and population-level information by authorized users, (3) 
decision support to enhance the quality, safety, and efficiency of 
patient care, and (4) support of efficient processes for health care 
delivery. 

Background: IT Adoption Rates in Health Care: 

We recently reported that current health IT adoption rates in the 
United States are varied and increasing the rates of IT adoption is 
critical to achieving significant benefits.[NOTE4]

* Respondents to a recent survey conducted by the Medical Group 
Management Association reported that only 31 percent of physician group 
practices use fully operational EHRs. 

* The Healthcare Information and Management Systems Society reported 
that 19 percent of hospitals use fully operational EHRs. 

* According to a study by the Commonwealth Fund, approximately 13 
percent of solo physicians have adopted some form of EHR, while 57 
percent of large group practices (50 or more physicians) have adopted 
an EHR. 

According to the Commonwealth Fund, gaps in adoption rates are further 
widened by barriers and challenges to implementing health IT that are 
greater for solo and small group practices. 

NOTE: 

[4] GAO, Health and Human Services' Estimate of Health Care Cost 
Savings Resulting from the Use of Information Technology, GAO-05-309R 
(Washington, D.C.: February 16, 2005). 

Background: Challenges to Implementing IT: 

While there are proven benefits to implementing health IT, the Medicare 
Payment Advisory Commission[NOTE 5] identified other factors that 
present financial, technical, and cultural challenges. 

* Investment in IT can be costly and must compete with other 
investments, and depends on the organization's ability to access 
capital. 

* Integrating new IT with other systems can further increase costs and 
system maintenance requirements. 

* Maintaining full operations when making system changes presents 
additional challenges. 

* Implementation of IT often requires changes in work processes and 
culture. 

* Physicians' reluctance is a major hurdle to implementing IT, and 
overcoming it is key to successful projects. 

NOTE: 

[5] The Medicare Payment Advisory Commission is an independent federal 
body established by the Balanced Budget Act of 1997 (P.L. 105-33) to 
advise the U.S. Congress on issues affecting the Medicare program. 

Background: Recent Studies on Cost and Benefits of Health IT: 

Studies by the Center for Information Technology Leadership identified 
savings from the widespread adoption of health IT. 

* The Value of Healthcare Information Exchange and Interoperability 
identified $78 billion in annual savings based on electronically 
sharing health care data between providers and stakeholders, which 
resulted in saving time and avoiding duplicate tests. 

* The Value of Computerized Provider Order Entry in Ambulatory Settings 
estimated $44 billion in annual savings based on avoidance of 
unnecessary outpatient visits and hospital admissions, as well as more 
cost-effective medication, radiology, and lab ordering. 

The center and other health care experts acknowledge that these 
estimates are based on limited data and a number of assumptions and, 
therefore, are not necessarily complete and precise. 

In October 2003, we reported significant financial benefits realized 
from the implementation of health IT, including cost savings at VA and 
expected savings at DOD (GAO-04-224; see appendix I). 

Background: Administration's Health IT Agenda: 

The President's health care IT plan calls for the widespread adoption 
of interoperable EHRs within 10 years. 

In April 2004, the President issued Executive Order 13335[NOTE 6] to 
"provide leadership for the development and nationwide implementation 
of an interoperable health information technology infrastructure to 
improve the quality and efficiency of health care." Among other things, 
the order called for: 

* the appointment of a national coordinator for health IT who is to 
report to the Secretary of HHS regarding progress on the development 
and implementation of a strategic plan. 

The Secretary appointed a national coordinator in May 2004 whose 
responsibilities include coordination of programs and policies 
regarding health IT across the federal government, and outreach and 
consultation between the federal government and the private sector. 

NOTE: 

[6] Executive Order 13335, Incentives for the Use of Health Information 
Technology and Establishing the Position of the National Health 
Information Technology Coordinator (Washington, D.C.: April 27, 2004). 

Background: HHS's Role in Health IT: 

As a regulator, purchaser, health care provider, and sponsor of 
research, HHS is taking steps to promote the use of IT in public and 
private health care settings. 

* The Agency for Healthcare Research and Quality (AHRQ) aims to 
translate research findings into better patient care and provides 
funding for state and regional IT demonstration projects and a national 
resource center for grantees and organizations that are engaged in 
health IT activities. 

- According to HHS officials, over half of AHRQ's funding goes to rural 
and small communities. 

* The Centers for Medicare and Medicaid Services (CMS) administers the 
Medicare program and works in partnership with states to administer the 
Medicaid program and the States Children's Health Insurance Program; 
CMS has established pilots to promote the adoption and effective use of 
health IT in physicians' offices and to improve beneficiary telephone 
customer service using web-based call centers. 

Indian Health Service (IHS) provides health services to American 
Indians and Alaskan Natives and reportedly uses a hospital information 
system that provides order entry, results reporting, encounter 
documentation, and other clinical functions. 

The Health Resources and Services Administration (HRSA) aims to expand 
access to high-quality health care and provide grants for community- 
based activities in informatics, EHRs, and telehealth. 

* HRSA awarded 65 grants and over $30 million for telehealth in 2004. 

The National Institutes of Health (N I H) works to apply scientific 
knowledge to extend healthy life and provide research grants for 
computer technologies to facilitate access, storage, and use of 
biomedical information, for training of informatics researchers and 
developers, and access to informatics resources. 

Background: Role of the National Committee on Vital and Health 
Statistics: 

The National Committee on Vital and Health Statistics (NCVHS) was 
established in 1949 as a public advisory committee that is statutorily 
authorized to advise the Secretary of HHS on health data, statistics, 
and national health information policy, including the implementation of 
health IT standards. 

* The committee is responsible for developing recommendations to HHS 
for standards to enable e-prescribing and delivered its first set of 
recommendations to the department in September 2004 with additional 
recommendations to be provided in March 2005. 

* The committee is also responsible for making recommendations to the 
Secretary of HHS for transaction and code set standards. 

In November 2001, NCVHS called for federal leadership to accelerate and 
coordinate progress on a national health information 
infrastructure.[NOTE 7]

* NCVHS intends to continue to address issues related to health IT and 
a national health information infrastructure and provide comments and 
recommendations to the Secretary as appropriate. 

NCVHS reviews results of HHS agencies' standards-setting initiatives, 
along with government and nongovernmental requirements and issues, and 
makes recommendations to the department secretary regarding the 
adoption of health IT standards, as appropriate. 

NOTE: 

[7] NCVHS, Information for Health: A Strategy for Building the National 
Health Information Infrastructure (Washington, D.C.: November 2001). 

Background: DOD's Role in Health IT: 

As previously reported,[NOTE 8] DOD has pursued the goal of providing 
IT support to its hospitals and clinics since 1968. 

* From 1976 to 1984, DOD spent about $222 million to acquire, 
implement, and operate various health care computer systems. 

* The Composite Health Care System (CHCS), deployed in 1993, is the 
primary DOD medical information system now used in all military health 
system facilities worldwide, supporting patient registration and 
inpatient activity documentation, and providing laboratory, radiology, 
pharmacy, drug interaction, and other functions. 

NOTE: 

[8] GAO, Information Technology. Greater Use of Best Practices Can 
Reduce Risks in Acquiring Defense Health Care System, GAO-02-345 
(Washington, D.C.: September 26, 2002). 

DOD initiated CHCS II in 1997 as an advanced medical information system 
to assist clinicians in making improved health care decisions and to 
lower costs. 

* As part of CHCS II, DOD is implementing a centralized Clinical Data 
Repository of life-long health records for military health system 
beneficiaries that provide documentation such as patient histories, 
physician notes, and population health reporting. 

* CHCS II represents DOD's EHR and will eventually replace the existing 
CHCS. 

According to HHS, DOD has a lengthy history working in remote and 
medically underserved areas and has experience in using IT, such as 
telehealth, to deliver care in isolated conditions which can be 
compared with the conditions in some rural environments. 

Background: VA's Role in Health IT: 

VA is the country's largest health care provider and, according to 
RAND,[NOTE 9] has been making significant strides in implementing 
technologies and systems to improve care, including an EHR that allows 
instant communication among providers across the country and reminds 
providers of patients' clinical needs. 

As we previously reported,[NOTE 10] VA has had an automated information 
system in its medical facilities since 1985. In 1996, this system 
evolved into the Veterans' Health Information Systems and Technology 
Architecture (VistA), an integrated outpatient and inpatient system 
that includes its EHR-the Computerized Patient Record System. 

VA's EHR technologies are available for public use and are being 
modified for transfer to rural and medically underserved settings. 

NOTES: 

[9] RAND, Improving Quality of Care: How the VA Outpaces Other Systems 
in Delivering Patient Care (Santa Monica, CA: 2005). 

[10] GAO Information Technology: Benefits Realized for Selected Health 
Care Functions, GAO-04-224 (Washington, D.C.: October 22 31, 2003) 

Background: Private Industry's Role in Health IT: 

According to the National Coordinator for Health IT: 

* While the federal government plays an important role in health IT 
adoption, the effective use of health IT lies predominantly with the 
private sector. 

* The federal government can provide a vision and strategic direction 
for a national interoperable health care system but will rely on the 
private sector to provide a competitive technology industry, privately 
operated support services, and shared investments in health IT 
adoption. 

* The private sector must develop the market institutions to deliver 
the products and services that can transform the paper-based health 
care system into an electronic, consumer-centered, and quality-based 
system. 

Background: Relevant Legislation: 

Federal legislation requires specific activities related to the 
implementation of health IT by both the public and private sectors. 

* The Health Insurance Portability and Accountability Act (HIPAA) of 
1996[NOTE 11] requires HHS to establish national standards for certain 
financial and administrative electronic health care transactions and 
national identifiers for providers, health plans, and employers. 

* The Public Health Security and Bioterrorism Preparedness and Response 
Act of 2002[NOTE 12] requires that the Secretary, in cooperation with 
health care providers and state and local public health officials, 
establish standards for interoperability of health alert and public 
health surveillance networks between federal, state, and local public 
health officials, and public and private health labs, hospitals and 
other facilities. 

Among other things, the Medicare Prescription Drug Improvement and 
Modernization Act of 2003[NOTE 13] includes provisions for an 
electronic prescription drug program and requires CMS to develop 
standards for electronic prescribing. 

* It also requires the establishment of a Commission on Systemic 
Interoperability to provide a road map for interoperability standards. 

* The act authorizes the Secretary of HHS to conduct a 3-year pay-for- 
performance demonstration program under which physicians are to adopt 
and use health IT to promote continuity of care, stabilize medical 
conditions, prevent or minimize acute exacerbations of chronic 
conditions, and reduce adverse health outcomes to meet beneficiaries' 
needs. 

NOTES: 

[11] Public Law 104-191 (August 21, 1996). 

[12] Public Law 107-188 (June 12, 2002). 

[13] Public Law 108-173 (December 8, 2003). 

Background: Previous GAO Reports on Health IT: 

GAO has historically reviewed and reported issues related to the 
federal government's efforts to implement health IT, including the need 
for an implementation strategy, costs and benefits of health IT, 
barriers to implementation, and DOD's and VA's efforts to implement 
EHRs and exchange data. 

Appendix I includes descriptions of GAO reports issued since 2000. 

National Health IT Strategy: Office of the National Coordinator for 
Health IT: 

The mission of the Office of the National Coordinator for Health IT is 
to develop and implement a strategic plan to guide the nationwide 
implementation of interoperable health care IT in both the public and 
private sectors. 

* According to the national coordinator, the office is a transitional 
organization with no permanent positions under the HHS Assistant 
Secretary for Budget, Technology and Finance. 

The first step in preparing a strategic plan was the release of a 
framework for strategic action, and in accordance with Executive Order 
13335, HHS released The Decade of Health Information Technology: 
Delivering Consumer-centric and Information-rich Health Care (July 
2004), which describes a framework for strategic action. 

* The office intends to release a complete strategic plan during this 
coming year to build upon the framework and provide detailed plans for 
implementing the President's vision. 

National Health IT Strategy: Framework for Strategic Action: 

The framework for strategic action outlines an approach toward the 
nationwide implementation of interoperable health IT in both the public 
and the private sectors. 

* It calls for a sustained set of actions which will be taken over many 
years by the public and private health sectors. 

* The framework outlines four major goals and 12 strategies for 
implementing a strategy for national health IT. 

The framework states a commitment to the development of 
interoperability standards, a key component of progress in 
interoperable health IT, and describes efforts to adopt standards for 
use by all federal health agencies. 

The framework also supports the role of the private sector and 
recognizes that the adoption and effective use of health IT require a 
joint effort between federal, state, and local governments and the 
private sector. 

As we testified in July 2004, as the national coordinator moves forward 
with this framework, it will be essential to have continued leadership, 
clear direction, measurable goals, and mechanisms to monitor progress. 
[NOTE 14] 

HHS's approach for implementing the framework's strategic actions 
aggregates its goals and strategies into three phases. 

* Phase I focuses on the development of market institutions to 
stabilize the market, create a better environment for investment and 
accountability, and lower the risk of health IT procurement. 

* Phase II involves investment in clinical management tools and 
capabilities such as EHRs, personal health records, telehealth, health 
information exchange, and other mechanisms for high-performance care 
delivery. 

* Phase III supports the transition of the market to robust quality and 
performance accountability, where clinicians have the tools and 
capabilities to manage patients and populations and to deliver 
consistently high-quality care in an efficient manner. 

HHS is currently implementing phase I and, according to the national 
coordinator, its initial efforts are focused on the building blocks of 
EHR adoption, interoperability, and streamlined federal health 
information systems. 

* These building blocks are necessary to enable both the private and 
public sectors to implement interoperable health information systems 
and to provide a foundation for efforts in later phases, such as 
personal health records and biosurveillance. 

However, HHS has not established milestones for the completion of phase 
I, nor has it defined or made plans for phases 11 and III. 

According to officials with the Office of the National Coordinator for 
Health IT, the office is in the process of establishing milestones for 
the completion of phase I but has not made plans for phases II and III 
because HHS has not formalized the organization or funding for future 
activities. 

Without defined milestones it remains unclear when the important 
activities of phase I will be completed and when the building blocks to 
support activities of the subsequent phases will be available. 

The following slides describe the framework's 4 goals and 12 strategies 
and key HHS IT initiatives that support the phase I goals. 

NOTE: 

[14] GAO, Health Care: National Strategy Needed to Accelerate the 
Implementation of Information Technology, GAO-04-947T (Washington, 
D.C.: July 14, 2004). 

National Health IT Strategy: Framework for Strategic Action: 

Goals: 

Goal 1: Inform clinical practice with the use of EHRs; 
Strategies[A]: 
1. Incentivize EHR adoption; 
2. Reduce risk of EHR investment; 
3. Promote EHR diffusion in rural and underserved areas. 

Goal 2: Interconnect clinicians so that they can exchange health 
information using advanced and secure electronic communication; 
Strategies[A]: 
1. Foster regional collaborations; 
2. Develop a national health information network; 
3. Coordinate federal health information systems. 

Goal 3: Personalize care with consumer-based health records and better 
information for consumers: 
Strategies[A]: 
1. Encourage use of personal health records; 
2. Enhance informed consumer choice ;
3. Promote use of telehealth systems. 

Goal 4: Improve public health through advanced biosurveillance methods 
and streamlined collection of data for quality measurement and 
research: 
Strategies[A]: 
1. Unify public health surveillance architectures;
2. Streamline quality and health status monitoring; 
3. Accelerate research and dissemination of evidence. 

Source: GAO analysis of HHS information. 

[A] Phase I strategies are shown in bold type. 

[End of table]

National Health IT Strategy: Phase I: Standards for EHRs: 

HHS is working with the private sector to develop standards for EHR 
functionality, interoperability, and security in order to reduce the 
risk of EHR implementation failure, a goal 1 strategy. 

* In July 2004, three leading health care industry associations-the 
Health Information and Management Systems Society, American Health 
Information Management Association, and National Alliance for Health IT-
established a private sector task force to develop certification 
requirements for ambulatory EHRs. 

- The Certification Commission for Health IT is made up of private 
sector and not-for-profit members with federal employees serving as 
experts on the commission's work groups. 

- The committee plans to define a basic certification process for EHRs 
in ambulatory settings by summer 2005. 

National Health IT Strategy: Phase I: HHS Support for Regional 
Collaborations: 

Currently, there are two HHS programs to support regional 
collaborations through grants and contracts. 

* In October 2004, AHRQ announced $139 million in multi-year grants and 
contracts to promote the use of health IT, including five-year 
contracts to five states to help them develop statewide networks. 

* HRSA's Office for the Advancement of Telehealth provides seed money 
and support to multi-stakeholder collaboratives within communities to 
implement regional health information organizations. It provided $2.3 
million in 2004. 

These programs support the goal 2 strategy to foster regional 
collaborations. 

The Office of the National Coordinator for Health IT plans to host an 
interoperability meeting with stakeholders this year to address 
requirements for regional organizations and the national health 
information network. 

National Health IT Strategy: Phase I: National Health Information 
Network: 

In November 2004, HHS issued a request for information (RFI) for ideas 
to develop a national health information network (NHIN)[NOTE 15]-a goal 
2 strategy. 

* The network is intended to provide technologies for the secure 
movement of information used in the delivery of health care in the U.S. 
integrated with public health surveillance and response, and shared 
within the public domain. 

* If implemented properly, the network should help achieve 
interoperability of health IT used in the mainstream delivery of health 
care in America, particularly pertaining to the information contained 
in or used by EHRs. 

* A key component of a NHIN is the development of interoperability 
standards and policies for diffusion into practice. 

The RFI addresses the goal to interconnect clinicians by seeking public 
comment and input regarding how widespread interoperability of health 
IT and health information exchange can be achieved. 

The results of the RFI are intended to provide information for policy 
discussions inside and outside the government about possible methods by 
which widespread interoperability and health information exchange could 
be deployed and operated on a sustainable basis. 

* HHS intends to explore the role of the federal government in 
facilitating deployment of a national health information network, how 
it could be coordinated with efforts to define a federal health 
architecture, and how it could be supported and coordinated by regional 
health information organizations. [NOTE 16] 

The RFI also requests input regarding privacy and security 
considerations, including compliance with HIPAA rules and the role of 
the private sector in the construction and implementation of a NHIN. 

According to the national coordinator, HHS received over 500 responses 
and has convened a governmentwide task force made up of over 100 people 
from 17 agencies to review the responses and produce a summary. 

NOTES: 

[15] The national health information network is now referred to as the 
nationwide health information network. 

[16] Regional health information organizations are multi-stakeholder 
collaboratives within communities that support health information 
exchange efforts. 

National Health IT Strategy: Phase I: Federal Health Information 
Systems: 

The office of the national coordinator is responsible for the Federal 
Health Architecture (FHA) program which is to define a framework and 
methodology for establishing the target architecture and standards for 
interoperability and communication throughout the federal health 
community, supporting a goal 2 strategy to coordinate federal health 
information systems: 

* FHA was initiated in 2003 in HHS's office of the chief information 
officer and was incorporated into the national coordinator's office in 
2004. 

FHA is intended to provide a structure for bringing HHS's divisions and 
other federal departments together through its partners' council, [NOTE 
17] initially targeting standards for enabling interoperability. 

* The FHA program is supported by four advisory work groups. 

* Appendix II includes descriptions of the FHA work groups and their 
responsibilities, followed by a table describing membership. 

The FHA partners are responsible for improving coordination and 
collaboration on federal health IT solutions and investments and 
improving efficiency, standardization, reliability, and availability of 
health comprehensive information solutions. 

* According to the national coordinator, there is a strong need for the 
federal government's health information systems to be able to exchange 
data so that these systems become more efficient and cost-effective. 

HHS plans to produce in September 2005 the first release of an 
information architecture for the federal health enterprise to enable 
collaboration and data sharing across the government and with various 
organizations, such as states and private entities. 

* The first release will contain foundational elements to support the 
development and evolution of the full architecture which will occur 
over several years. 

The FHA's Consolidated Health Informatics (CHI) initiative is focused 
on the adoption of health information interoperability standards, 
identification of gaps and additional work areas in domains without 
standards recommendations, and coordination with developers of health 
information interoperability standards to promote accessibility and 
distribution of adopted standards to support the FHA. 

* Consolidated Health Informatics was initiated in December 2001 as an 
OMB e-government project to establish federal health information 
standards to enable federal agencies to build interoperable health data 
systems. 

* The project was incorporated into FHA in September 2004. 

NOTE: 

[17] The FHA partners' council includes almost 400 members from 15 
agencies: 

National Health IT Strategy: Phase I: Personal Health Records: 

In January 2005, NCVHS held hearings on personal health records-a goal 
3 strategy to personalize care-and identified issues, some specifically 
related to the federal government. 

* Issues discussed include privacy and information control, security of 
health information, legal issues, cost, and interoperability. 

* Federal issues include the relationship of roles in and uses of 
personal health records to the larger health objectives of the federal 
government, such as (1) what costs agencies will face, (2) how the 
federal government should promote interoperability, and (3) whether 
there needs to be a standardized approach to a personal health record 
across all of the federal activities. 

The hearings also discussed broader issues such as ownership and 
control of personal health information and policy issues such as access 
rights and authorization of usage. 

National Health IT Strategy: Framework Support: Standards and 
Interoperability: 

According to the national coordinator, the development of technically 
sound and robustly specified interoperability standards and policies is 
a key component of progress toward the implementation of a national 
strategy that provides interoperable health IT systems: 

The development, approval, and adoption of standards for health IT is 
an ongoing, long-term process that supports multiple goals of the 
framework and includes federally mandated standards requirements (e.g., 
HIPAA) and a voluntary consensus process within a market-based health 
care industry. 

The use of some standards, such as those defined by HIPAA and MMA, is 
mandated by the federal government while others are defined by 
standards development organizations such as the American Association of 
Medical Instrumentation and the National Council for Prescription Drug 
Programs. 

The following graphic provides an overview of the highly complex 
standards-setting process for health care data exchange in the United 
States. 

Overview of the Process to Set Standards for the Exchange of Health 
Care Data in the U.S. 

[See PDF for image]

Note: 

AAMI = American Association of Medical Instrumentation; 
ASC = Accredited Standards Committee; 
ASTM = American Society for Testing and Materials; 
DICOM = Digital Imaging and Communication in Medicine; 
HL7 = Health Level Seven; 
IEEE = Institute for Electrical and Electronics Engineers; 
NCPDP = National Council for Prescription Drug Programs; 
NIST = National Institute of Standards and Technology, (part of the 
Commerce Dept) 

Source: Institute of Medicine, Patient Safety: Achieving a New Standard 
for Care (Washington, D.C.: 2004). 

[End of figure]

HHS identifies and researches standards that are defined by standards 
development organizations and determines which approved standards are 
appropriate for use in federal agencies' health IT systems. 

According to an HHS official, the department has limited authority to 
mandate standards outside of the federal government, but, through the 
Consolidated Health Informatics initiative, is encouraging the 
implementation of standards within the federal government to provide a 
catalyst for the private sector to follow. 

Federal agencies agreed to endorse 20 domains of health data standards 
for information exchange as a model for the private sector, yielding 11 
sets of standards to be used in federal IT architectures. 

HHS is committed to supporting collaboration between the public and 
private sectors to develop, adopt, and certify standards. 

HHS divisions, such as AHRQ, CMS, NIH, CDC, and FDA, have been and 
continue to be responsible for selecting and adopting standards and are 
now included in the CHI initiative, supporting multiple goals of the 
framework. 

AHRQ and CMS are working on initiatives that support goal 1 of the 
framework. 

* AHRQ is working to identify and establish clinical standards and 
research to help accelerate the adoption of interoperable health IT 
systems, including: 

- industry clinical messaging and terminology standards,
- national standard nomenclature for drugs and biological products, and 
- standards related to clinical terminology. 

CMS is responsible for identifying and adopting standards for e- 
prescribing and for implementing the administrative simplification 
provisions of HIPAA, including electronic transactions and code sets, 
security, and identifiers. 

NIH's work on standards supports the framework's goal 2. 

* NIH's National Library of Medicine (NLM) is working on the 
implementation of standard clinical vocabularies, including support for 
and development of selected standard clinical vocabularies to enable 
ongoing maintenance and free use within the United States' health 
communities, both private and public. 

- In 2003, NLM obtained a perpetual license for the Systematized 
Nomenclature of Medicine (SNOMED)[NOTE 18] standard and ongoing 
updates, making SNOMED available to U.S. users. 

- Other efforts at NLM include the uniform distribution and mapping of 
HIPAA code sets, standard vocabularies, and Health Level 7[NOTE 19] 
code sets. 

The Centers for Disease Control and Prevention (CDC), FDA, and NIH are 
working on standards-setting initiatives that support the framework's 
goal 4. 

* CDC, through its Public Health Information Network (PHIN) initiative, 
is working on the development of shared data models, data standards, 
and controlled vocabularies for electronic laboratory reporting and 
public health information exchange that are compatible with federal 
standards activities such as CHI. 

* FDA and NIH, together with the Clinical Data Interchange Standards 
Consortium, a group of over 40 pharmaceutical companies and clinical 
research organizations, have developed a standard for representing 
observations made in clinical trials, the Study Data Tabulation Model. 

In May 2003, we recommended to HHS that ongoing standards-setting 
organizations coordinate their efforts to define and implement health 
IT standards (GAO-03-139; see appendix I). 

NOTES: 

[18] SNOMED is a nomenclature classification for indexing medical 
vocabulary, including signs, symptoms, diagnoses, and procedures. It 
was adopted as a CHI standard in May 2004. 

[19] HL7 is a standards development organization that creates message 
format standards for electronic exchange of health information. 

National Health IT Strategy: Framework's Goals and Supporting HHS IT 
Initiatives: 

In addition to those already described, other ongoing HHS IT 
initiatives support the framework's goals. 

The following table lists key HHS IT initiatives for health IT by 
division and identifies the goals that they support. 

Descriptions of each of the initiatives are included in appendix III. 

National Health IT Strategy: Framework's Goals and Supporting HHS IT 
Initiatives: 

[See PDF for image]

Source: GAO analysis of HHS information. 

[End of table]

National Health IT Strategy: Framework Support: Private Sector 
Participation: 

Certain private sector activities provide support for goals 1 and 2 of 
the framework. 

* The private sector task force, the Certification Commission for 
Health IT, is working to develop certification procedures for EHRs, 
supporting goal 1. 

* The Commission on Systemic Interoperability, which includes 
nationally recognized experts in the area of health IT, is charged by 
the Medicare Modernization Act to develop a comprehensive strategy for 
the adoption and implementation of health care IT interoperability 
standards, which supports goal 2. 

HHS has supported and continues to support opportunities for private 
sector participation in establishing health care IT through grants and 
funding for demonstration projects through its divisions. 

HHS participates with the medical and public health communities, 
academia, and health IT vendors through conferences and symposia. 

* The national coordinator speaks at industry conferences that are 
focused on identifying government incentives to encourage health IT 
adoption in private industry. 

* HHS's Secretarial Summit on Health IT held in July 2004 provided 
nongovernmental participants opportunities to make recommendations 
regarding incentives for health IT, population health, clinical 
research, and health IT governance. 

According to HHS, close collaboration between public and private 
sectors can develop new methods for improving care without creating 
unnecessary regulation and minimizing reporting burdens on private 
industry. 

Lessons Learned from VA and DOD: 

DOD and VA experiences in implementing EHRs offer important lessons 
learned that could be used in developing and implementing a national 
health care effort. As providers and payers of health care services, 
DOD and VA's lessons include: 

* Obtain full endorsement of top leadership: 

- Senior administrators and clinical leaders should share and 
communicate a common sense of urgency regarding the need for change. 

- Senior leadership's full endorsement, including support for funding, 
is critical to successfully implementing an electronic health record, 
promoting end-user support, and securing a usable product. 

Implement an enterprise-wide communication plan: 

* EHR implementation entails organizational change and acceptance 
across the enterprise and at all organizational levels. 

* System acceptance and support depend upon regular, effective 
communication, from executive leadership levels down through end users. 

* Keeping stakeholders informed of objectives, progress, problems 
encountered and resolved, lessons learned, and benefits is critical to 
setting realistic expectations and facilitating stakeholder buy-in. 

Recognize and address needs of the varied stakeholder communities: 

* A management/governance structure that represents the entire 
stakeholder community should be established, and reflect clearly 
defined roles, responsibilities, and decision-making authority among 
the different levels of leadership. 

* Users (i.e., clinicians, payers, and others) should have an early and 
integral role in defining a strategy to meet their needs, establish 
accountability for the initiative, and sustain long-term project 
success. 

* Users should be actively involved in all project phases, including 
requirements definition, system design, development, testing, and 
implementation. 

Define and adopt common standards, terminology, and performance 
measures: 

* Early definition and adoption of common standards, terminology, and 
performance measures (communication, data, and security) and agreement 
on related implementation guidelines are essential to achieving data 
quality and consistency, system interoperability, and information 
protection. 

Deploy in small increments and build on success: 

* Follow an incremental system development approach to accommodate 
evolving business processes, requirements, and technology changes; 
limit initial deployment to a few test sites to allow time for the 
process to mature, and assimilate lessons learned before full 
deployment. 

Customize training and support to sustain system implementation: 

* Establish training programs that are tailored to meet the needs of 
the varied users' groups. On-site clinical champions and subject-matter 
experts should be identified and empowered to promote and demonstrate 
the new system to other personnel and provide ongoing technical 
assistance. 

Lessons Learned from Other Countries: 

Canada, Denmark, and New Zealand: 

While the U.S. has just begun to develop a national strategy for health 
IT adoption, Canada and Denmark have developed national strategies and 
begun to take steps toward implementation, and New Zealand plans to 
finalize its strategy in June 2005. 

* Canada finalized its strategy in 2004 and is a year into 
implementation. 

* Denmark finalized its strategy in February 2003 and is 2 years into a 
4-year implementation plan. 

* New Zealand has prioritized six initiatives to be implemented in the 
next 3 to 5 years. 

These countries are farther along in their strategy development and 
implementation than the U.S. and are able to share lessons learned from 
their experiences. 

Lessons Learned from Other Countries: 

Overview of Canada's Health Care System: 

The Canadian health care system supports publicly financed health for 
over 31 million people. 

The federal government is responsible for direct health service 
delivery to veterans, native Canadians living on reserves, military 
personnel, inmates of federal penitentiaries, and the Royal Canadian 
Mounted Police, as well as health protection, disease prevention, and 
health promotion services. 

The administration and delivery of health care services is the 
responsibility of each province or territory, guided by the provisions 
of the Canada Health Act. The provinces and territories fund these 
services with assistance from the federal government in the form of 
fiscal transfers. 

Canada Health InfoWay is working with the provinces and territories to 
advance the IT building blocks needed for the health care system. 

* Canada Health InfoWay is a corporation whose board of directors is 
made up of representatives from all of the provinces and territories, 
as well as elected representatives. 

5

Lessons Learned from Other Countries: 

Lessons Learned from Canada: 

Lessons Learned: 

Focus on creating standards first. 

Recognize that creating a health IT infrastructure takes years, and 
benefits may not be realized in the short term. 

Identify a central visible point to provide political advocacy and 
highlight the achievements of health IT as work progresses to help 
maintain support for long-term projects. 

Identify and provide appropriate incentives based on provincial and 
territorial elements to motivate physicians to use IT. 

Proactively resolve issues related to privacy protection. 

Anticipate and mitigate border-crossing issues with implementing 
telehealth, such as issues with licensing arrangements and cross-border 
reimbursements. 

Lessons Learned from Other Countries: 

Overview of Denmark's Health Care System: 

The Danish health care system serves a population of 5.3 million people 
and is 85% tax-financed. 

At the national level, the Ministry of Health is responsible for 
legislation and preparing overall guidelines for the health care 
sector, and the National Board of Health is responsible for supervising 
health personnel. 

The regional level consists of 14 counties and the Copenhagen Hospital 
Corporation. The counties own and run hospitals and prenatal care 
centers and finance general and specialist practitioners, pharmacies 
and physiotherapists through the National Health Security System. 

The responsibility for the municipal level includes nursing homes, home 
nursing, health visitors, and school health services. 

Denmark's National Strategy for IT in Health Care 2003 - 2007 was 
finalized in February 2003. 

* It states that the most important reasons for increasing the use of 
IT in health care are related to the improvement of quality, 
efficiency, and effectiveness of health care delivery. 

* Three major initiatives of the National Strategy are: 

- coordinated development, testing, and implementation of EHRs,

- a national database to organize health care terms and concepts, and: 

- concept classifications to facilitate communications across sectors 
and professions in health care. 

Lessons Learned from Other Countries: 

Lessons Learned from Denmark: 

Lessons Learned: 

Implementation of health IT across the entire country will take a long 
time. 

Involve health care service providers throughout the entire 
implementation process. 

A very strong central organization must lead the entire health IT 
implementation from start to finish. 

Integrate federal efforts with hospitals before undertaking a larger 
national plan. 

Anticipate and resolve funding, IT process reengineering, consensus- 
building, and other issues during the planning phase to avoid negative 
impacts on progress. 

Realize that the investment in health care IT is costly, and short-term 
gains are hard to identify. 

Promote successes as soon as possible to encourage acceptance by 
stakeholders. 

Lessons Learned from Other Countries: 

Overview of New Zealand's Health Care System: 

The New Zealand health care system serves a population of 4 million 
people. 

At the national level, the Ministry of Health provides policy advice on 
improving health outcomes and monitors the performance of the district 
health boards. 

The regional level consists of 21 district health boards. Each district 
health board has up to 11 members, seven of which are elected by the 
community and up to four of which are appointed by the Minister of 
Health. 

* District health boards are responsible for planning, funding and 
ensuring the provision of health and disability services to a 
geographically defined population. 

New Zealand is currently redeveloping its health information strategy, 
which is expected to be complete by June 2005. 

The draft strategy identifies 12 action zones for implementation 
planning over the next 3 to 5 years; six were selected as initial 
priorities: 

* Enable secure connections and access to health information: 

* Ensure national systems anchors (such as the National Health Index) 
are in place: 

* Create and publish accessible key event summaries: 

* Expand the level of electronic communication across primary and 
secondary care: 

* Extend the collection of health information: 

* Safe Access to National Information within the context of the Health 
Information Privacy Code is essential for the support of population 
health: 

Lessons Learned from Other Countries: 

Lessons Learned from New Zealand: 

Lessons Learned: 

The distributed government model that governs New Zealand's health care 
system works best. 

High level EHR components that can be shared and accessed encourage 
greater coordination of health services. 

Provide adequate funding for and prioritize the initiatives: 

Educate stakeholders about the value of developing health IT to 
encourage stakeholder buy-in. 

Lessons Learned from Other Countries: 

Overview of the United Kingdom's Health Care System: 

The United Kingdom's Department of Health is responsible for setting 
health and social care policy in England; health services are largely 
tax-financed in the United Kingdom and account for 14 per cent of 
general government spending. 

In summer 2002, the government set up the National Programme for IT 
(NPfIT) which defines four main projects to be introduced in stages 
across different regions: 

* Electronic Patient Records; 

* Electronic Appointment Booking; 

* Electronic Transmission of Prescriptions; 

* Communications Network: 

NPfIT plans to have electronic booking substantially in place and to 
have 50% of prescriptions transmitted electronically by the end of 
2005. 

We could not identify lessons learned from the United Kingdom's efforts 
based upon publicly available information. 

Conclusions: 

Since establishing the Office of the National Coordinator for Health 
IT, HHS has made progress toward coordinating federal health IT efforts 
and reaching out to private industry. 

However, coordination of standards development and adoption activities 
throughout the health care industry, including federal efforts to 
accelerate the process, remains a challenge. 

HHS has not made long-term plans or established milestones for the 
implementation of a national strategy to accelerate the adoption of IT 
across the health care industry. 

DOD's and VA's experiences in implementing EHR systems offer important 
lessons learned that may be applied to HHS's efforts to help increase 
the likelihood that interoperable EHRs could be available in the next 
ten years. 

The United States could benefit from other countries' experiences and 
lessons learned from their efforts toward modernizing their health IT 
infrastructures. 

The National Coordinator for Health IT recognizes DOD's and VA's 
efforts and works closely with them to share lessons learned from their 
experiences with implementing health IT. 

The national coordinator has recently initiated discussions with other 
countries to also learn from their experiences in modernizing health 
information infrastructures. 

Recommendation: 

To accelerate the adoption of interoperable IT for health care, we 
recommend that the Secretary of HHS: 

* establish detailed plans and milestones for each phase of the 
framework for strategic action, and: 

* take steps to ensure that plans are followed and milestones are met. 

Agency Comments: 

We requested comments from HHS, DOD, and VA on a draft of these 
briefing slides. 

* HHS did not provide comments. 

* DOD's Chief Enterprise Architect for Military Health System provided 
written technical comments, which we incorporated as appropriate. 

* VA's Acting Deputy Chief Information Officer for Health provided oral 
comments and agreed with the information presented. 

Appendix I: 

Recent GAO Reports on Health IT: 

Health and Human Services' Estimate of Health Care Cost Savings 
Resulting from the Use of Information Technology (GAO-05-309R; February 
17, 2005): We reported that IT can improve the efficiency and quality 
of medical care and result in costs savings and that, although 
estimated nationwide savings are primarily based on studies with 
methodological limitations and are contingent on much higher IT 
adoption rates than are currently estimated, the potential for 
substantial savings is promising. 

Health Care: HHS's Efforts to Promote Health Information Technology and 
Legal Barriers to its Adoption (GAO-04-991 R; August 13, 2004): We 
identified major HHS IT initiatives and associated funding, and 
reported that attempts by the federal government to address legal 
issues that present barriers to the widespread use of IT have not been 
sufficient. 

Health Care: National Strategy Needed to Accelerate the Implementation 
of Information Technology, (GAO-04-947T; July 14, 2004): 

We reported that it will be essential to have continued leadership, 
clear direction, measurable goals, and mechanisms to monitor progress 
of the implementation of a national strategy for health IT. 

Computer-Based Patient Records: VA and DOD Efforts to Exchange Health 
Data Could Benefit from Improved Planning and Project Management, (GAO- 
04-687; June 7, 2004): To help ensure progress in achieving the two-way 
exchange of health information, we recommended that VA and DOD develop 
an architecture for an electronic interface between their health 
systems and establish a project management structure to guide the 
initiative. 

Computer-Based Patient Records: Improved Planning and Project 
Management Are Critical to Achieving Two-Way VA-DOD Health Data 
Exchange, (GAO-04-811 T; May 19, 2004): 

We testified that DOD and VA were continuing with activities to support 
the sharing of health data; nonetheless, achieving the two-way 
electronic exchange of patient health information remained far from 
being realized. 

Computer-Based Patient Records: Sound Planning and Project Management 
Are Needed to Achieve A Two-Way Exchange of VA and DOD Health Data (GAO-
04-402T; March 17, 2004): We testified that DOD and VA had made little 
progress since November 2003 in determining an approach for achieving 
two-way exchange of patient data and reported that DOD and VA have 
taken measures towards implementing prior recommendations for enhancing 
management and accountability. 

Computer-Based Patient Records: Short-Term Progress Made But Much Work 
Remains to Achieve A Two-Way Data Exchange Between VA and DOD Health 
Systems (GAO-04-271 T; November 19, 2003): We testified that DOD and VA 
faced challenges in exchanging standardized data and that a common 
health information infrastructure and architecture was needed to 
achieve data exchange capability. 

Information Technology: Benefits Realized for Selected Health Care 
Functions ( GAO-04-224, October 31, 2003): We reported significant 
improvements in health care delivery and financial benefits realized 
from the nation's health care community's implementation of health IT, 
including cost savings resulting from VA's and DOD's implementation of 
health IT. 

Bioterrorism: Information Technology Strategy Could Strengthen Federal 
Agencies' Abilities to Respond to Public Health Emergencies (GAO-03- 
139; May 30, 2003): 

We recommended that HHS coordinate with DHS, DOD, and VA to establish a 
national IT strategy, and that ongoing standards-setting organizations 
coordinate their efforts to define and implement health IT standards. 

Computer Based Patient Records: Better Planning and Oversight by VA, 
DOD, and IHS Would Enhance Health Data Sharing (GAO-01-459; April 30, 
2001): We recommended that DOD, VA, and IHS create comprehensive and 
coordinated plans to ensure that the agencies can share patient health 
data, including performance measures and use of existing IT 
capabilities. 

Appendix II: Responsibilities of FHA Work Groups: 

Food safety: recommend a target, business architecture to serve as the 
framework for developing and implementing systems which support the 
food safety business government-wide: 

Interoperability: recommend target technical standards for 
interoperability across the health line of business. 

EHR: recommend a target, health care services electronic health record 
business architecture, a component of the health lines of business, to 
serve as framework within the federal sector for developing and 
implementing an electronic health record. 

Public health surveillance: recommend a target architecture related to 
the health line of business to serve as the framework within the 
federal sector for developing and implementing public health 
surveillance systems. 

Appendix II: FHA Work Groups' Members and Leaders: 

[See PDF for image]

Source: HHS. 

[End of table]

Appendix III: Descriptions of Key HHS IT Initiatives: 

[See PDF for image]

Source: HHS divisions. 

[End of table]

[End of slide presentation] 

[End of section]

Appendix II: Comments from the Department of Health and Human Services: 

DEPARTMENT OF HEALTH & HUMAN SERVICES 
Office of Inspector General:
Washington, D.C. 20201: 

MAY 24 2005: 

Mr. David A. Powner: 
Director:
Information Technology Management Issues: 
U.S. Government Accountability Office: 
Washington, DC 20548: 

Dear Mr. Powner: 

Enclosed are the Department's comments on the U.S. Government 
Accountability Office's (GAO's) draft report entitled, "HEALTH 
INFORMATION TECHNOLOGY-HHS is Taking Steps to Develop a National 
Strategy" (GAO-05-628). The comments represent the tentative position 
of the Department and are subject to reevaluation when the final 
version of this report is received. 

The Department provided several technical comments directly to your 
staff. 

The Department appreciates the opportunity to comment on this draft 
report before its publication. 

Sincerely,

Signed for: 

Daniel R. Levinson: 
Acting Inspector General: 

Enclosure: 

The Office of Inspector General (OIG) is transmitting the Department's 
response to this draft report in our capacity as the Department's 
designated focal point and coordinator for U.S. Government 
Accountability Office reports. OIG has not conducted an independent 
assessment of these comments and therefore expresses no opinion on 
them. 

COMMENTS BY THE U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES ON THE 
U.S. GOVERNMENT ACCOUNTABILITY OFFICE'S REPORT ENTITLED "HEALTH 
INFORMATION TECHNOLOGY--HHS IS TAKING STEPS TO DEVELOP A NATIONAL 
STRATEGY" (GAO-05-628): 

The Department of Health and Human Services (HHS) appreciates the 
opportunity to review the draft General Accountability Office's (GAO) 
report to the House of Representatives Committee on the Budget entitled 
"HEALTH INFORMATION TECHNOLOGY - HHS is Taking Steps to Develop a 
National Strategy." The focus of the GAO report is on HHS's recent 
efforts to develop a National health IT strategy for realizing the 
President's vision, lessons learned from the Department of Defense's 
and Veterans Administration's and other countries' experiences in 
implementing health IT. 

The National Coordinator for Health Information Technology (National 
Coordinator) was appointed on May 6, 2004, and heads the Office of the 
National Coordinator for Health Information Technology (ONC). In a new 
position in the Government with responsibilities for coordinating 
internal Federal health information technology (health IT) programs as 
well as coordinating with private sector health IT efforts, the 
National Coordinator has taken an iterative approach to strategic 
planning. This has allowed the National Coordinator to be inclusive in 
planning, to balance near-term needs with long-term goals, and to work 
within the constraints of available resources and appropriations. The 
core of ONC's efforts are the Framework for Strategic Action (the 
Framework) published in July 2004 and the Request for Information (RFI) 
published in November 2004. 

The GAO report highlights numerous other activities and developments 
regarding health IT that have occurred during the past year as well, 
including: 

* ONC has consulted with, and actively partnered with, numerous Federal 
agencies in the U.S. Government including the Departments of Veterans 
Affairs, Defense, Commerce, and Homeland Security. 

* ONC has met with many organizations and individuals representing 
stakeholders of the healthcare system. 

* ONC has reached out to States and regions through site visits and 
town hall meetings to understand the health IT challenges experienced 
at the local level as well as best practices for the use of, and 
collaboration regarding, health IT. 

* ONC has regularly testified before, and been informed by, the 
National Committee on Vital and Health Statistics on issues critical to 
the Nation's health IT goals. 

* ONC has monitored and coordinated with the efforts of the Commission 
for Systemic Interoperability. 

* The National Coordinator has met with delegations involved with 
health IT from other countries, including Canada, Netherlands, Japan, 
Australia, Great Britain, and France. 

As recommended in the GAO report, HHS agrees that detailed plans and 
milestones are necessary, and they must meet near-term, medium-term, 
and long-term planning needs. HHS has begun to take key steps to act on 
the Framework and the lessons from the large public response to the 
RFI. 

The Secretary recently released his 500-Day Plan which includes as an 
integral part the transformation of the health care system. This plan 
includes long-term (5,000 day) visions and shorter-term (500 day) 
strategies to achieve these visions. Three of those strategies include 
health IT: 

* Expressing a clear vision of health information technology that 
conveys the benefits to patients, providers, and payers. 

* Convening a national collaboration to further develop, set, and 
certify health information technology standards and outcomes for 
interoperability, privacy, and data exchange. 

* Realizing the near-term benefits of health information technology in 
the focused areas of adverse drug-incident reporting, e-prescribing, 
lab and claims-sharing data, clinic registrations, and insurance forms. 

Three of the Secretary's longer-term visions are: 

* Nearly all health records can be linked through an interoperable 
system that protects privacy as it connects patients, providers, and 
payers - resulting in fewer medical mistakes, less hassle, lower costs, 
and better health. 

* Consumers are better informed and have more choices. 

* Payers reward providers for healthy outcomes rather than quantity of 
care and services. 

HHS funds have been reallocated to provide a total of $32.8 million to 
initiate this work in fiscal year (FY) 2005. For FY 2006, the President 
has requested an additional $125 million which, if approved, will help 
HHS to further develop milestones and plans that are consistent with 
the 500-Day Plan. 

In May 2005, the Secretary released the Health IT Leadership Panel 
Report, prepared by the Lewin Group, an HHS contractor, which 
highlighted findings from a small group of Fortune 100 CEOs who 
convened to consider and discuss issues related to health IT. This 
report called for Government to be a leader, catalyst, and convener of 
the Nation's health information technology effort. The Secretary has 
already begun by listening to stakeholders through a series of 
roundtable discussions. 

HHS will continue working in concert with those principles and items 
identified by GAO as lessons from the VA and DOD. This includes the 
continued leadership of the Secretary as evidenced in his 500-Day Plan; 
identification and adoption of additional clinical standards through 
Federal Health Architecture and Consumer Health Information as well as 
e-prescribing standards under the Medicare Prescription Drug, 
Improvement, and Modernization Act of 2003; additional stakeholder 
input through collaboration; and, focus on near-term wins to "deploy in 
small increments and build on success." 

[End of section]

Appendix III: Comments from the Department of Veterans Affairs: 

THE DEPUTY SECRETARY OF VETERANS AFFAIRS: 
WASHINGTON: 

May 20, 2005: 

Ms. Linda D. Koontz: 
Mr. David A. Powner: 
U. S. Government Accountability Office: 
441 G Street, N.W. 
Washington, DC 20548: 

Dear Ms. Koontz and Mr. Powner: 

The Department of Veterans Affairs (VA) has reviewed the Government 
Accountability Office's (GAO) draft report, HEALTH INFORMATION 
TECHNOLOGY: HHS is Taking Steps To Develop a National Strategy (GAO-05- 
628). VA is pleased that this review found the lessons learned from VA 
and the Department of Defense could provide Health and Human Services 
valuable insights as it develops a national health information 
technology infrastructure. Technical comments are included in the 
enclosure. 

VA appreciates the opportunity to comment on your draft report. 

Sincerely yours,

Signed for: 

Gordon H. Mansfield: 

Enclosure: 

[End of section]

(310475): 

FOOTNOTES

[1] According to HHS, market institutions include certification 
organizations, group purchasing entities, and low-cost implementation 
support organizations that do not currently exist but are necessary to 
support clinicians as they procure and use IT. 

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