Interoperability in Healthcare Explained

Margaret Lindquist | Content Strategist | June 24, 2024

The goal of healthcare interoperability is to allow multiple systems to share patient and other data, securely store it, and make it accessible to the providers, patients, payers, and public health administrators who need to view it.

The Healthcare Information and Management Systems Society (HIMSS) defines healthcare interoperability as "the ability of different information systems, devices, and applications to access, exchange, and cooperatively use data in a coordinated manner, within and across organizational, regional, and national boundaries, to provide timely and seamless portability of information and optimize the health of individuals and populations globally.” Key interoperability elements are open data schemas and standards that let healthcare providers share information, regardless of the EHR software they use, and make that information available to patients through multiple channels, including mobile devices, websites, and kiosks.

Interoperability projects were originally focused on systems within a single health enterprise—for example, making sure that patient data collected by a primary care physician flowed to labs and imaging so that electronic orders could be linked to billing and claims submissions. Now efforts are underway to develop interoperable systems that span the healthcare ecosystem—including providers, patients, payers, regulators, and researchers—at national and global levels.

What Is Interoperability?

Interoperability is the capacity for each system on a network to communicate with other systems to share, consolidate, and use data. Interoperable applications and systems automatically exchange data in such a way that the data is accessible, accurate, and secure, with little human interaction needed. Interoperability is possible only when all stakeholders—healthcare organizations, governments, payers, and other players—agree on the standards, technologies, and terminology needed for the exchange of data between diverse systems.

What Is Interoperability in Healthcare?

Interoperability in healthcare describes the capacity for disparate health data systems to share data, regardless of geographic location, and allow that data to be used by providers, researchers, and public health managers to improve patient experiences and community health. Interoperable health systems have their own set of standards and guidelines, with the goal of creating a network of shared health data so that providers can access complete, accurate patient data no matter where the patient has previously received care. With such a system in place, clinicians can make better decisions and provide better care, patients can take ownership of their data and care options, community leaders can act on early warning signs of public health issues, and finance teams can help ensure prompt and accurate billing and claims reimbursement.

Each of us generates an enormous amount of personal healthcare information, including lab results, prescriptions, and doctor's notes.

What Data Is Exchanged via Interoperable Healthcare Systems?

Interoperable healthcare systems exchange all sorts of patient data, including basic information about treatment plans, prescriptions, and lab test results, demographic information, and immunization records. Most patients expect—or hope—that information related to visits, treatment plans, medication histories, and immunizations is available to them through interoperable healthcare systems. But industry and government health leaders have a bigger vision for the types of data that will be exchanged, which includes demographic information (such as ethnicity, age, and language spoken), genetic predispositions, allergies and sensitivities, and provider communications. According to research from the US Department of Health and Human Services, a more standardized approach to collecting detailed information—for example, details about lifestyle patterns, such as food choices and smoking habits—will help uncover healthcare disparities and allow for personalized interventions by care providers.

Key Takeaways

  • Interoperability describes the standards, processes, organizational structures, and technologies needed to create a network of systems whereby data is securely shared and accessed by only the people who need to view it.
  • A goal of healthcare interoperability is to allow clinicians to see complete, accurate patient histories to help them provide better care, as well as reduce costs.
  • Interoperability requires breaking down barriers at the organizational, departmental, system, and national levels.

Healthcare Interoperability Explained

One of the biggest challenges in healthcare is creating electronic health records (EHRs) that are patient-centric rather than provider-centric. A person’s medical history is likely to be scattered across the different EHR systems used by different providers, making it difficult for clinicians to access accurate and complete information and make appropriate treatment decisions. The situation is even more challenging for public health officers and medical researchers because the records that could support the study of national health trends and the development of new treatments are contained in thousands of data silos in many different locations. New government policies, organizational processes, and technologies are key to easing the flow of information within and among organizations while adhering to relevant privacy rules.

Interoperable healthcare systems include health information exchanges (HIEs), which pull together medical information from different departments within a healthcare system, as well as qualified health information networks (QHINs), which share data at the national level. The ultimate goal is a unified global health network that will not only enable better care at the patient level but also let researchers and public health officials identify and address public health challenges at an early stage. “Why is there a global financial database that knows your entire credit history but not a global healthcare one?” asks Larry Ellison, founder and CTO of Oracle. “If you have an accident, the hospital will know your financial records but not if you’re allergic to penicillin.”

Why Is Healthcare Interoperability Important?

When data flows among patients, providers, payers, and community health organizations, healthcare becomes more efficient and cost-effective—but more important, care and health outcomes improve. For example, the CommonWell Health Alliance, a vendor-neutral platform that encompasses 34,000 provider sites and 231 million patients, gives providers access to a nationwide network of comprehensive patient data—not just data from a single facility or system—with the goal of helping to improve care coordination and health outcomes across the United States.

What Are the Four Levels of Interoperability in Healthcare?

The Healthcare Information and Management Systems Society (HIMSS) defines the following four levels of healthcare interoperability, some of which can be achieved with currently available technologies, while others will require new technology and organizational process innovations. These levels describe the data exchange schema and standards that should allow data sharing throughout the healthcare ecosystem, no matter what applications or vendors are used. Each level builds on the previous one.

Level 1: Foundational

Foundational interoperability is the most basic level, whereby data securely travels from one system or device to another. For example, at this level providers would be able to share simple data such as emails or PDFs, but the next level of interoperability would be necessary to enable the system to understand, process, and integrate the data.

Level 2: Structural

Structural interoperability is achieved when the format of data exchange between systems is standardized so data can be input and output by multiple systems or devices. Data types range from simple text, codes, identifiers, and address formats to images and video. Standards such as HL7 FHIR (Fast Healthcare Interoperability Resources) help ensure that patient data is consistently shared across systems using various forms of exchange protocols. With this data at hand, providers can more easily identify gaps in care and provide recommendations that become part of the longitudinal patient record.

Level 3: Semantic

Semantic interoperability establishes a common vocabulary for inputting data into health systems, such as ICD-10 codes for mortality statistics and the Logical Observation Identifier Names and Codes standard for lab tests and results. The semantics are important in ensuring that different systems present relevant concepts that are meaningful and accurate.

Level 4: Organizational

Organizational interoperability requires more than just technical know-how. Regulatory policies, legal oversight, and communal acceptance are key to helping the health industry create, manage, and advance interoperability. For example, the Trusted Exchange Framework and Common Agreement, from the US Office of the National Coordinator for Health Information Technology, aims to establish universal governance and policy guidelines for interoperability, simplifying organization-to-organization connectivity and allowing patients to access their entire medical record through a single interface.

Benefits of Healthcare Interoperability

It’s impossible to understate the importance of sharing information across healthcare enterprises. For some patients, it can literally be the difference between life and death. Organizations must put collaboration ahead of competition to help ensure that clinicians have the information they need at their fingertips to make the most informed medical decisions and patients can access a complete, accurate record of their healthcare journey to help them maintain or enhance their health. Meantime, public health officials need to better understand community health statuses and opportunities for targeted care, payers need accurate data to process bills and manage risk, and researchers need to find new ways to prevent and cure illnesses. Read on to learn more about the benefits of healthcare interoperability.

  • Improve Patient Care: Patients clearly benefit when their doctor has access to their complete medical record—and the benefits are particularly apparent in emergency situations in which the patient is unable to communicate clearly. And as more people contract chronic diseases—a study published in the National Library of Medicine, part of the National Institutes of Health (NIH), estimates that the number of people in the US living with a chronic condition will increase from 141 million in 2010 to 171 million by 2030—better data interoperability is crucial to understanding the underlying causes and supporting the development of new medicines and therapeutic practices.
  • Reduce Physician Burden: The first EHR systems actually increased burnout rates, according to research published in the National Library of Medicine, as administrators and care providers struggled with balky interfaces, tedious manual data entry, and the shifting of clerical tasks to clinicians. Fortunately, new EHR tools are reducing the burden on physicians by incorporating higher-quality data from multiple sources in one place, as well as embedding AI to automatically generate patient updates and analysis. However, with this data exchange comes new challenges. “When you tell physicians that you’re making a lot more data available to them, the response is more often a grimace than a smile because it represents more work to sift through it for relevant information,” says Sam Lambson, Oracle Health’s VP for interoperability. Tools that can pull in third-party clinical data, compare it with existing data, and determine what's new and high quality are crucial. These tools also allow healthcare enterprises to designate some third-party data sources, such as immunization registries or other care venues, as trusted sources that can write directly into a patient record. Interoperable EHRs that are easier to use and update and whose data is more complete will allow physicians to spend more time caring for patients.
  • Enhance Care Coordination: It’s essential to coordinate everyone in the care continuum, including nurses, general practitioners, specialists, and post-acute-care providers. The goals of such coordination are to eliminate repeated tests, conflicting treatment recommendations, and miscommunications among care providers and between providers and patients. New software tools collect data from all points of care, reduce duplicate entries, and help ensure that patient data follows the patient wherever they receive treatment, even if it’s thousands of miles from their home or months or years later.
  • Improve Workflow Efficiency: With interoperable health systems, providers can see the complete patient record, avoid duplicate tests and procedures, and make timelier decisions about treatment plans. And patients can make appointments, view test results, and query their care provider using their preferred apps with easy-to-use interfaces. Additionally, improved workflow efficiency can help reduce administrative burdens and, in turn, costs—according to a study by the Commonwealth Fund, administrative costs are one of the main reasons the US spends twice as much per person on health as peer nations.
  • Empower Patients: Giving patients access to their health data is one of the core benefits of system interoperability. Patients are better able to seek second opinions and alternative treatments, download educational materials that can help with disease management, and access their own diagnoses and test results. They no longer need to hunt down records from multiple providers and remember when and where they sought treatment, which medications they’ve been prescribed, and the details of their treatment plans. Key to this effort is providing this comprehensive data to patients through easy-to-use applications or web pages that also include an accurate history of the data’s source. Governments worldwide are working to ensure that patients gain access to their own data. In the US, the 2020 Interoperability and Patient Access Final Rule published by the Centers for Medicare & Medicaid Services (CMS) established policies that advance interoperability and access to health information held by payers. It requires certain payers—including Medicare Advantage, Medicaid, Children’s Health Insurance Program, and Qualified Health Plan issuers on federally facilitated exchanges—to build standard APIs that allow for more secure data exchange among providers, payers, and patients.
  • Reduce Costs: Many of the cost savings that result from improved healthcare interoperability come as a result of better patient care, which in turn reduces hospital stays, complications, and unnecessary care, such as redundant tests. Interoperable systems can also reduce administrative time and costs by automating prescription management, allowing doctors to connect directly to pharmacy systems, and relieving clinical staff of mundane data entry tasks that occur when data needs to be copied manually into a different system. Improved connections between clinical and payment systems also help hospitals get reimbursed in a timelier manner.
  • Support Public Health Initiatives: As patient records become more accessible and accurate, public health officials are starting to pool and analyze that identified and de-identified data to assess whether a particular patient population is prone to specific diseases or health conditions. Public health epidemiologists and researchers can analyze disease development, care management, and health outcomes, as well as uncover insights about typical patient journeys through the healthcare system. Interoperability also helps streamline and automate public health reporting, particularly with the recent expansion of electronic case reporting, which makes data more complete and timelier.
  • Advance Research and Innovation: Medical researchers stand to gain a great deal from interoperability. Large-scale research projects can benefit from pools of de-identified data that share common characteristics and a common vocabulary and are continually updated. For example, Oracle Learning Health Network, a repository of data on a hundred million patients that’s expanding worldwide, is helping biopharmaceutical companies with their clinical trial recruitment. Interoperability can also support the growth of decentralized clinical trials, whereby data comes in from different site locations and even from patients’ mobile and wearable devices.
  • Help Meet Regulatory Requirements: Government regulation of healthcare interoperability has accelerated in the past few years. 2009’s American Recovery and Reinvestment Act requires US healthcare providers to shift from paper to electronic files, and 2016’s 21st Century Cures Act requires EHR vendors to provide patient-facing capabilities. One former government healthcare official notes that getting all EHR vendors to work toward interoperability had to be a government mandate; otherwise, some vendors would have opted out. Canada Health Infoway’s Pan-Canadian Interoperability Roadmap, released in 2023, aims to reduce data blocking, improve provider access to patient data, allow patients to access their health records, and improve care coordination. Canada Health Infoway’s Pan-Canadian Interoperability Roadmap aims to reduce data blocking, improve provider access to patient data, allow patients to access their health records, and improve care coordination.

Challenges of Healthcare Interoperability

Advances in interoperability promise to enhance the quality, efficiency, and cost-effectiveness of healthcare, but there are challenges to overcome. Health technology vendors, care providers, payers, patients, and government legislators and regulators all have a role to play in meeting these challenges, and it’s only through collaboration that health information will finally start becoming readily available. While experts understand that better healthcare interoperability will improve healthcare and patient outcomes, they face numerous challenges as they work to make vital connections between disparate systems that contain unprecedented amounts of data. Read on to learn more.

  • Lack of Standardization: HL7 FHIR enables the next progression of standards-based data sharing, using modern APIs and the internet. While adoption is progressing, more industry players, including all health information technology vendors, hospitals, and government organizations, need to get on board.
  • Data Security and Privacy Concerns: As patient data becomes more accessible, organizations must set up procedures to ensure the security and privacy of that data, whether it resides in their own data centers or in those of their cloud service providers. Research published in the Journal of Medical Internet Research outlines the ways health providers, health plans, and healthcare clearing houses can share data under the Health Insurance Portability and Accountability Act (HIPAA), particularly when it comes to sharing data with patients themselves. The introduction of autonomous digital health systems will help ensure security and privacy, given that configuring systems and updating patient data are done automatically, without manual labor that can introduce errors and security gaps.
  • Fragmented Systems and Data Silos: Some clinicians may view sharing patient data with research centers as a competitive disadvantage. Data silos exist even within a single health organization—for example, where a department uses a specialty EHR that isn’t connected to another department’s EHR. Improving interoperability requires a commitment from healthcare providers and researchers to share data, as well as a commitment from government regulators to set and enforce standards. There are even health practices that still don’t use EHR systems—for example, behavioral health practices have lagged behind hospitals in their adoption because of outdated privacy laws that require those providers to segregate their health records from others.
  • Budget/Cost and Resource Constraints: The financial and technical resources needed to implement a modern, interoperable health system can be daunting to hospitals and other healthcare organizations that are already strapped. Although it may be tempting to put off digital modernization efforts, healthcare enterprises that do so run the risk of paying in the long run, as they must contend with security vulnerabilities, an inability to make data-driven decisions, and clinicians who are saddled with time-consuming manual data entry tasks.
  • Technical Complexity and Interoperability Barriers: One of the biggest barriers to interoperability is the use of multiple incompatible EHR systems, which can create data silos and cause duplication of patient records, some of which are incomplete or inaccurate. These identification errors degrade patient care and reduce revenue due to denied claims. Another interoperability challenge occurs when data transfer is one way. Research from the US Office of the National Coordinator for Health Information Technology (ONC) finds that 48% of hospitals share data with other organizations but don’t receive data in return. Other interoperability barriers include legacy technology that inhibits provider-to-provider communication and a lack of standardization around healthcare data formats.
  • Interoperability Governance and Policies: As interoperability becomes more prevalent at the national level, concerns about “information blocking”—practices that impede the access, exchange, or use of digital patient data—have begun to surface. In response, the 21st Century Cures Act was enacted to increase data sharing among NIH-supported researchers and improve privacy protection for research volunteers. The act outlines eight exceptions where information blocking is permitted—for example, in the case of privacy and system security concerns. Late in 2023, the Office of Inspector General at the US Department of Health and Human Services (HHS) began enforcing penalties for organizations that engage in information blocking, at a cost of up to US$1 million per violation. The HHS will prioritize complaints that cause or have the potential to cause patient harm, impact healthcare provision, and cause financial loss to federal healthcare programs or other entities.
  • Data Completeness, Quality, and Integrity: New interoperability features are giving clinicians the ability to highlight the most relevant patient data at the top of the screen in the form of alert bars—for example, for allergies, current prescriptions, and major diagnoses—helping reduce data overload. Going forward, voice-recognition digital assistants can ease clinical workloads by letting doctors and nurses update patient records more easily, and some will use AI-based decision-support tools to listen in on clinical appointments, propose contextual next actions, and automatically update the patient’s EHR. As more and more of this patient data flows among health providers, another challenge is to ensure that patient records are matched to the correct person, a task that becomes more complicated as organizations share records using different systems and patient data is generated from multiple locations. A number of healthcare organizations are supporting the Match IT Act of 2024, which would create a national standard for patient matching and establish that match rate as a clinical quality measurement. According to the Lown Institute, more than 20% of the stents placed in Medicare patients between 2019 and 2021 were unnecessary, at a cost of US$2.44 billion. In another study published in the National Library of Medicine, 76% of patients suffering from uncomplicated acute surgical conditions were subjected to unnecessary bloodwork.

Healthcare Interoperability and Compliance

Few industries are as heavily regulated as healthcare, as the risks associated with systemic failures have life-changing consequences. Healthcare organizations need robust compliance programs, policies, and procedures, particularly for high-risk treatment areas, as well as training programs aimed at making sure all employees understand their compliance responsibilities. One such effort is a voluntary program, run by the ONC, that provides test tools and procedures to health IT developers to certify that they’re building a baseline of logging, security, and data-sharing capabilities into their EHR software modules.

Create a Foundation for Interoperability with Oracle

Oracle Health’s open systems-based interoperability products give clinicians access to relevant information from multiple sources, both inside the health system and from third parties, such the CommonWell Health Alliance and other health exchanges.

Oracle Cloud Infrastructure (OCI) is built to run every healthcare workload, from legacy applications to modern AI-enabled services. Oracle Health Seamless Exchange connects external and internal patient data to provide a comprehensive record of a patient’s care, regardless of the source. It deduplicates redundant information and presents data in a simplified workflow, reducing data overload for practitioners. Healthcare organizations can also identify third parties as trusted sources and allow them to write directly into the local record so clinicians can spend less time gathering information and more time connecting with patients.

Interoperability in Healthcare FAQs

What is an example of interoperability?

Healthcare system interoperability helps ensure that patient data is up to date and available to providers, no matter where the patient is seeking treatment. Consider the example of a patient on vacation who’s rushed unconscious to a local hospital because of an adverse reaction to a prescription. True system interoperability would allow clinicians at that hospital to access the patient’s complete medical history, regardless of the EHR used by the patient’s primary provider.

How do you explain interoperability?

Interoperable systems are those that automatically share data, regardless of the system vendor.

What is an example of interoperability in nursing?

Interoperable health systems make patient data readily available to nurses as they perform their duties. For example, a nurse could access a patient’s health record and determine their vaccination status, medications, and the reasons for previous visits to the healthcare facility—or other facilities—all before their first conversation.

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