Saying Epic is a ‘closed’ health records system is an oversimplification

As health care reform has focused on the digitization of health information, one Wisconsin company, Epic Systems, has quietly, and reluctantly, moved into the public eye.

The company’s computer systems — in use at thousands of clinics and hospitals across the country — store the electronic health records (EHRs) of more than half of all Americans, according to some estimates.

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Having all those records on one company’s tech platform may be a good thing, and many in health care will tell you that the sharing of records among Epic-using providers around the country has saved a lot of lives.

But some within the health care community have criticized Epic for not doing more to allow its customers to share clinical data with non-Epic facilities, describing it as “closed” and “proprietary.”

And now, with health care reform, the government is mandating that clinics and hospitals begin sharing data to improve the coordination of care as patients move here and there in the system. Sharing health data between between hospitals, medical groups, labs, and specialists is, in fact, is crucial to bringing health costs under control in the U.S.

Sharing patient records: It’s complicated

A recent New York Times article puts a spotlight on one doctor who says his facility’s Epic system won’t allow him to share data in a way that will satisfy the government. This, he said, could open him up to Medicare reimbursement penalties if the problem persists.

But the challenge of sharing clinical data among different EHR systems is a spiny one, and it’s larger than just one vendor.

In fact, several high-profile health care industry sources have told VentureBeat that compared to other large U.S. EHR vendors, Epic may have done the most to enable data sharing — both among its own customers and with hospitals and groups that don’t use Epic.

One of them is John Kenagy, senior vice president and chief information officer at Legacy Health, a large community-based health system in the Pacific Northwest.

“No vendor solves this problem completely,” Kenagy says. “There’s a natural inclination to blame Epic because they’re just a big target.”

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Legacy Health, in fact, has a lot riding on how well its in-house EHR shares data with different systems at other providers.

“Legacy is a system of community hospitals, and the vast majority of our physicians are in private practice with their own EHRs.  Being able to exchange clinical data is an important strategic objective,” Kenagy explains.

“If you are Kaiser, or an academic center, with a predominantly employed medical staff [that is, part of Kaiser], there’s less of a demand for data sharing across different systems,” Kenagy says. “Our patients are being seen by independent providers all the time. So it’s critical to our success that we’re able to share data with other EHRs.”

Kenagy says all the hospitals in the Legacy system are now able to satisfy the data interoperability requirements in the federal government’s Meaningful Use Stage 2 guidelines.

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The guidelines require that a health provider be able to transmit and receive secure clinical messages to and from other providers. Hospitals need to have the systems in place to send aftercare instructions electronically to the primary care physician in another location who will take care of a hospital patient after she’s been discharged.

“In the past it’s been fax and paper, or the patient has to tell the primary care doctor her aftercare instructions,” Kenagy says. “Now, of all those transitions of care, 10 percent must be shared electronically.”

In order to receive these continuity of care documents, the medical group has to have a secure medical messaging account, Kenagy explains. The Epic system can send an encrypted message over a direct connection to another EHR system. This message might contain imaging documents, patient problem lists, or medication histories.

Epic offers its customers a set of custom interfaces that essentially set the rules for what kinds of content gets shared, how it’s formatted, and how it’s transmitted. The interfaces are compliant with a well-known health industry data sharing standard called HL7.

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When an Epic system receives a message from another EHR using the same accepted standards, the data is offered to a physician, who then uses medical judgment to decide which external information to be included in the patient’s Epic chart.

“By design it doesn’t go automatically into the record because we want to make sure there’s clinical judgment in deciding what information should be in our system,” Kenagy says.

Epic’s side of the story

Epic CEO Judy Faulkner says all Epic customers now have the ability to send and receive patient data.

“One hundred percent of our customers that are live with our EHR are also live with our Care Everywhere software built in,” Faulkner told VentureBeat, referring to the company’s branded data sharing interface.

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“We have even gone back and retrofitted it into old versions so that every one of our customers can send and receive to others, to anyone who uses industry standards, whether they use Epic software or if they use other vendors’ software who also follow the standards,” she says.

Faulkner says Epic didn’t charge its customers to retrofit older versions of its software with the ability to exchange patient records data.

Epic’s customers pay an annual fee to exchange data with other EHR systems. The company says the yearly cost for an average-sized hospital is around $5,000 a year. Epic customers who don’t share that many records can opt to pay a “small annual per-patient fee,” Epic says.

Faulkner says Epic keeps these exchange rates low to make it easier for providers comply with the minimum data sharing standards in the HITECH (Health Information Technology for Economic and Clinical Health) Act, she adds.

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The HITECH Act was enacted as part of the American Recovery and Reinvestment Act (ARRA) stimulus package in 2009, and allocates funding for hospitals and physicians who demonstrate “Meaningful Use” of EHRs. “Stage II” of meaningful use concerns the meaningful sharing of patient records data.

“If there’s an error … someone could die”

Epic may have become a lightning rod for frustration over a problem that’s more about a whole industry than it is about one vendor. It’s often said that health care lags far behind other industries in systems integration and data sharing. But there’s a reason for that.

“We are probably 15 years behind the banking industry, but our data set is so much more complex than just dollars and cents,” Kenagy says.

“The data we deal with in clinical systems changes constantly,” Kenagy says. “If there’s an error in a billing system, somebody loses some money, but if there’s an error in a clinical system, someone could die.”

Legacy hospitals and clinics use Epic systems, and Kenagy believes the vendor has done a lot to enable the sharing of clinical records within and without their system. “I’m impressed with what they’ve been able to do,” Kenagy says.

On the whole, EHR systems capture and store clinical data in different ways, and those methods may have evolved through years of use in the trenches. That’s made it difficult to conform to standard ways of organizing and sharing health data. No single standard has emerged to get various EHRs talking the same language. Numerous health data exchange standards already exist, and EHR vendors and their provider partners struggle to comply with as many as they can.

“There are multiple standards, and we do most … if not all of the ones that are most frequently used,” Faulkner says. This is where Faulkner believes the government could play a valuable role.

“If the number of standards were reduced, that would be good,” Faulkner says. “You know the old saying … The good thing about standards is that you have so many to choose from,” she quips.

Faulkner: The government could do more

Epic’s Faulkner believes the government could do a lot more than it is now to facilitate the secure sharing of health data. The government, she says, could develop a data exchange standard that would do three main things:

First, the government might help providers all over the country contribute a sort of “data exchange provider ID.” This would help providers identify each other, as well as to access information about how to request or send data. These provider IDs would be collected in a master “phone book” that would be distributed to all providers.

Faulkner points out that an EHR vendor can easily create a directory of all the health providers that use its software for the sake of exchanging data. But it’s hard for that vendor to include health providers that don’t use its EHR in that directory, because there’s no existing business relationship there.

Epic, for example, has gone to great lengths to create a directory listing the thousands of Epic-using providers all over the country. Sources have told me that the health information exchanged between Epic facilities has saved a lot of lives. But Epic can’t easily include in its phone book providers that use other EHRs.

The government could also help in establishing a “certificate authority,” Faulkner says, which would let one provider know for certain that an unknown provider requesting information about a mutual patient is trustworthy.

“If UCSF gets a patient from the University of Texas, and UCSF contacts the University of Texas and says ‘I want their data,’ how does the University of Texas know that it is really UCSF and not a hacker?” Faulkner says. “That’s what the certificate authority tells them.”

Faulkner says the government could also help create the terms of a “shared agreement” that would govern the way providers handle health information that’s shared with them by other facilities.

One source with knowledge of Epic told VentureBeat that Faulkner deserves much praise for insisting that all of Epic’s customers be ready to share patient records with other Epic-using facilities under the Care Everywhere framework — even if they are competitors. It was important to Faulkner that a patient’s record could be accessed anywhere in the system, whether that patient is at their local hospital or in an emergency room far from home. Hospitals in the Epic system are required to share.

The source, however, shares the opinion of some others who spoke to VentureBeat that Epic could be more progressive in creating new standard interfaces to other, non-Epic systems.

Another source close to Epic says the company is focusing efforts on building more application programming interfaces (APIs) that can be used other systems to access certain elements of the patient record. Epic says it will be releasing more APIs in 2015, which allow external clinical decision support systems, natural language processing systems, population management systems, and new apps to pull data from the Epic system.

Is Epic a victim of its own success?

Epic’s main competitor, Cerner, believes that it has the edge in technology used for exchanging data with other EHR systems. Cerner’s EHR system has been used mainly in hospitals, less so in medical clinics.

Epic’s EHR system is strong in both the medical group and hospital environments. This has made the system attractive to hospitals, which increasingly want tight systems integration with the medical groups they contract with or own. Advantage Epic.

Wells Fargo health care IT analyst Jamie Stockton says there’s some truth to Cerner’s view (expressed at the company’s last investor day) that Epic is “on the defensive” on health information exchange.

But, he says, it might be true only because Epic hasn’t had to integrate with other systems as much as Cerner has. Not only is Epic the dominant player in the EHR market (and probably becoming moreso), but being a privately held company it has the liberty to walk away from deals where it might have to share the stage with a competing EHR.

Cerner is a different story. “The simple fact is that Cerner’s clinical solutions have been implemented in a vast array of mixed vendor environments, which is much less common for Epic,” Stockton writes.

“Cerner has not had as strong of an ambulatory offering historically, so there are a lot of health systems that are using the company’s HIE (health information exchange) technology to connect owned or affiliated physician groups on various EHRs to (Cerner’s hospital EHR system) Millennium on the inpatient side.”

It’s precisely because Epic is strong on both the ambulatory and hospital environments that so many health systems have chosen its EHR, says Dan Michelson, CEO of the hospital cost analytics company Strata Decision Technology.

“It is clear that many have forgotten the reason why hospitals invested hundreds of millions in Epic in the first place. The simple fact is that interoperability in healthcare is really hard and, because every healthcare system had failed trying to patch different electronic health records together, they turned to Epic to deliver a single patient record.”

Epic points out that regardless of how much interoperability experience it has, the proof is in the customer satisfaction numbers. Epic’s says its customers are the happiest in the industry with the way their EHR system allows them to exchange health data with other EHRs. This distinction was discovered in a recent report from respected EHR industry research group KLAS. Only Siemens’ customers were more satisfied than Epic’s with their efforts to keep interfacing costs down.

Stockton also notes that because Cerner and Epic cover an estimated 40-45 percent of patient beds in the U.S., and because the health care industry continues to consolidate, Epic and Cerner systems will need to interoperate more and more.

Legacy’s Kenagy says the Epic systems he manages routinely share data with Cerner systems. 

KLAS ranks Epic highest of all the major hospital EHR vendors in user satisfaction with health information exchange. It ranked behind Cerner and Siemens in the depth of the data it’s able to exchange, but if there was an overall winner, it would be Epic.

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So is Epic the highly pragmatic and competitive vendor its competitors make it out to be, or is Epic really doing everything it possibly can to enable data exchange with other systems, constrained only by concerns about the security and privacy of the data? 

The real answer probably falls somewhere in between the two extremes. But Epic clearly isn’t the “closed” system that many make it out to be.

Undoubtedly there are physicians (like the one quoted in The New York Times‘ article) who work for Epic-using providers that can’t share data with other non-Epic providers to the extent needed to comply with current government requirements.

It’s possible that those physicians work for providers that, because of the costs, have chosen not to do the necessary integration work to share the EHR data they’d like to. The cost of that integration may simply amount to more than a (potential) penalty for failing to comply with new government health data exchange requirements. 

But it’s also clear that Epic is aware that it has an image problem in this area. This may be part of the reason that the extremely media-shy company agreed to talk to VentureBeat for this article.

And it’s probably more than PR. Epic will likely release a flurry of new APIs next year.

Faulkner and company are clearly aware that health data sharing will only become more important as the trends of industry consolidation, population management, and value-based care accelerate in the coming years.