• Cal eConnect President Abruptly Resigns; $90 Million California Health Information Exchange procurement, a critical component of Obamacare, runs into a wall.

    August 19th, 2011 by admin Categories: Blogs Tags: , , , , , , , , ,

    Major trouble has been brewing this week over at Cal eConnect, the state’s new non-profit, super-agency responsible for California’s version of a Health Information Exchange (HIE) to allow the efficient exchange of patient health information.

    Today it was announced that Cal eConnect President & CEO Dr. Carladenise Edwards has left her post “due to personal reasons” effective yesterday  August 18th. Other personnel shakeups at Cal eConnect may also be in the works. This happens at a very critical time for Cal eConnect and reminds us of problems with Cal eConnect’s predecessor the California Regional Health Information Organization (CalRHIO) which imploded last year after critics claim it wasted $7 million.

    Earlier this week, Cal eConnect abruptly suspended (see below) its landmark exchange computer system procurement for the design, development, implementation, operation, and maintenance of a Provider Directory Service with Electronic Health Information Exchange (HIE) Capabilities. In a letter obtained by TechLeader.TV and copied below, all prospective bidders were told that the procurement would be immediately “paused, in place”, and bidders’ interviews scheduled for this week were likewise cancelled. No word as to when the almost $90 million procurement would be “unpaused”, but bidders were asked in this letter to confirm in writing that their proposals and proposed prices would remain valid for 180 days from the date of submittal (until December 26, 2011). That sounds like a significant delay, which obviously means the estimate will not stay at $90 million.

    As one can imagine for an IT-related procurement of this size there was considerable vendor interest with some 50 companies attending the vendors conference last May. All the major players were in attendance including the likes of HP, AT&T,  Accenture, CGI, Microsoft, Northrop, Cisco and so on…

    No other official word was provided as to the reason for the CEO’s resignation or the procurement delay; however, TechLeader.TV’s questions to Cal eConnect Board of Directors member Dr. David Lanski and Alex Barrios, Director of Communications, about reports there may have been a possible conflict of interest, or a matter of non-compliance on the part of Cal eConnect with the federal Office of the National Coordinator for Health Information Technology (ONC) guidelines, were denied.

    A little background here might be helpful.

    A health information exchange (JTF note: they should have called it a network to avoid confusion) relies on electronic health records to improve patient care.  It is a network that connects patients, providers, physicians, hospitals and other health care organizations in order to provide access to critical medical record information. Cal eConnect is funded by a portion of the $23 billion federal Health Information Technology for Economic and Clinical Health (HITECH) Act enacted as part of the American Recovery and Reinvestment Act of 2009. Cal eConnect is responsible for creating California’s statewide network to let different electronic health record systems exchange information, or “talk” to one another. Initial funding for these state Health Information Exchanges across the U.S. (except for states who have opted out, but that’s a whole other story) with over half a billion dollars in grants. California’s share was $39 million.

    On the other hand, a health insurance exchange (JTF note: again, should have called it a marketplace) involves people buying insurance. It is a marketplace where individuals and small businesses can select health insurance plans from a variety of different insurance companies, and by banding together they can get better prices and more value in health insurance options, like big corporations who can negotiate for their employees today. The California Health Benefit Exchange (HBEX), California’s HIX, is an independent public entity within state government with a five-member board appointed by the Governor and the Legislature. Ironically, it also recently received a $39 million federal grant that will help the state plan for and design this new health insurance marketplace to cover millions of Californians,

    I expect we might be hearing about State Auditor and federal investigations in the very near future. This story as they say is developing…

    JTF Note: This post has been updated on August 28, 2011 as several of our faithful readers “mt” and “HITguy” have graciously pointed out your faithful scribe’s confusion over health “information” exchanges (HIE) and health “insurance” exchanges (HIX). A tip of the hat to them both.

    1900 Powell Street
    Suite 800
    Emeryville, CA 94608

    August 16, 2011

    TO:               Interested Bidders

    FROM:         Cal eConnect

    SUBJECT:   RFP 2011-011

    Thank you for your response to Cal eConnect’s Request for Proposals #2011-011 for a Provider Directory Service with Electronic Health Information Exchange (HIE) Capabilities.  The purpose of this letter is to provide you with a status update on the procurement.

    Cal eConnect would like to inform you that it has changed the timeline for the above procurement.  A new timeline for procurement has been established and is being communicated to you via this letter.  The new timeline was established to allow Cal eConnect to reassess its needs.  These schedule changes will benefit both Cal eConnect and the eventual contractor.

    The procurement is being paused “in place.”  The procurement process is still ongoing and no bidder has been selected. Bidder interviews scheduled during the week of August 15, 2011, will be rescheduled at a point in the near future.

    Due to the timeline change, all bidders should send a written notice confirming that their proposals and proposed prices are valid for 180 days from the date of submittal (until December 26, 2011). This written notice should be sent via email to Gwyn Jackson, Sr. Project Manager, by 4:00 PM (PDT) on August 26, 2011.

    We appreciate your continued observation of the limits on communication outlined in the RFP.  If you have any questions, please contact me at (916) 308-7064 or gjackson@caleconnect.org. Thank you for your interest and flexibility in working with us.

    Gwyn Jackson

    Sr. Project Manager

    1. mt says:

      Your headline is wrong. You’re confusing health *information* exchanges with health *insurance* exchanges. The former were funded by the economic stimulus (ARRA or HITECH) but it is the latter that the pillars of the Health Reform law. Cal eConnect is a health information exchange, NOT a health insurance exchange.

      • admin says:

        I never mention “insurance”; read Cal eConnect’s own letter to vendors at bottom of post suspending in their words, “Request for Proposals #2011-011 for a Provider Directory Service with Electronic Health Information Exchange (HIE) Capabilities”.

    2. HITguy says:

      MT was pointing out that your reference to PPACA in the first paragraph is the error, or at least a major stretch.

      “Major trouble has been brewing this week over at Cal eConnect, the state’s new non-profit, super-agency responsible for California’s version of a Health Information Exchange (HIE) to allow the efficient exchange of patient health information. *It’s a major cornerstone of the Patient Protection and Affordable Care Act (PPACA)*, popularly known as “Obamacare”. ”

      PPACA’s cornerstone is health *insurance* exchanges – “HIX” – regulated marketplaces to purchase health coverage. Cal eConnect funding has nothing to do with PPACA.

      Health *information* exchanges – “HIE” – the technical infrastructure to enable data exchange between healthcare providers – was funded by ARRA/HITECH, and that’s where Cal eConnect got their funding. You mention that later in the article. I don’t think too many folks think HIE is going to make or break PPACA as the “cornerstone”.

      I do agree that the Cal eConnect CEO “leaving for personal reasons” after a year on the job does not instill any confidence that the organization is going to make things happen with their bucket of money.

    3. Anonymous says:

      Chief Operations Officer, Chief Technical Officer, Chief Sustainability Officer – all have changed at CaleConnect, mostly over the last six months. What IS going on??

    4. Anonymous says:

      U should look at the baecompany website. It lists Carladenise as a principal from 2005 to current on her posted resume link.

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