Reducing Medicare Spending Through Electronic Health Information Exchange: The Role of Incentives and Exchange Maturity
Authors: Adjerid, Idris; Adler-Milstein, Julia; Angst, Corey
Journal: Information Systems Research (2018)
<jats:p>Health information exchanges (HIEs) are entities that have emerged in healthcare delivery markets across the United States. By providing an interorganizational information system (IOIS) and governance over use of this system and the information exchanged through it, HIEs enable more routine and efficient electronic sharing of patient information between disparate and fragmented healthcare providers. This should result in improved quality and efficiency of care. However, significant questions persist about the extent to which HIEs produce these benefits in practice, particularly in terms of reducing healthcare spending. We use transaction cost economics (TCE) to theorize that HIEs establish a quasi-hierarchy that decreases frictions associated with information sharing in ways that reduce healthcare spending, and that the magnitude of reductions is greater when (1) insurer and provider incentives align, and (2) HIE capabilities mature. We can test these conjectures because HIEs, unlike other efforts that provide IOIS, are typically confined to regional markets and develop heterogeneously between these markets, introducing variation in insurer-provider incentive alignment and…