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A strategic gaming model for health information exchange markets

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Abstract

Current market conditions create incentives for some providers to exercise control over patient data in ways that unreasonably limit its availability and use. Here we develop a game theoretic model for estimating the willingness of healthcare organizations to join a health information exchange (HIE) network and demonstrate its use in HIE policy design. We formulated the model as a bi-level integer program. A quasi-Newton method is proposed to obtain a strategy Nash equilibrium. We applied our modeling and solution technique to 1,093,177 encounters for exchanging information over a 7.5-year period in 9 hospitals located within a three-county region in Florida. Under a set of assumptions, we found that a proposed federal penalty of up to $2,000,000 has a higher impact on increasing HIE adoption than current federal monetary incentives. Medium-sized hospitals were more reticent to adopt HIE than large-sized hospitals. In the presence of collusion among multiple hospitals to not adopt HIE, neither federal incentives nor proposed penalties increase hospitals’ willingness to adopt. Hospitals’ apathy toward HIE adoption may threaten the value of inter-connectivity even with federal incentives in place. Competition among hospitals, coupled with volume-based payment systems, creates no incentives for smaller hospitals to exchange data with competitors. Medium-sized hospitals need targeted actions (e.g., outside technological assistance, group purchasing arrangements) to mitigate market incentives to not adopt HIE. Strategic game theoretic models help to clarify HIE adoption decisions under market conditions at play in an extremely complex technology environment.

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Acknowledgments

The authors would like to thank the three anonymous reviewers for their thoughtful revision.

Author’s Contribution

DM contributed to the idea conception, study design, model development, and acquisition and analysis of results. FF contributed to the study design, model development and analysis of results. SL, TD and JZ are guarantors and contributed to the idea conception and analysis of results. All authors contributed equally in preparing and reviewing multiple versions of the manuscript and provided significant intellectual content. All authors read and approved the final version of this manuscript.

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Authors and Affiliations

  1. Department of Emergency Medicine, Johns Hopkins University, Baltimore, Maryland, USA

    Diego A. Martinez & Scott Levin

  2. Systems Institute, Johns Hopkins University, Baltimore, Maryland, USA

    Diego A. Martinez, Felipe Feijoo & Scott Levin

  3. Engineering Sciences Department, Universidad Andres Bello, Santiago, Chile

    Felipe Feijoo

  4. Department of Civil Engineering, Johns Hopkins University, Baltimore, Maryland, USA

    Felipe Feijoo

  5. Department of Industrial and Management Systems Engineering, University of South Florida, Tampa, Florida, USA

    Jose L. Zayas-Castro & Tapas K. Das

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  1. Diego A. Martinez
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Correspondence to Diego A. Martinez.

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Martinez, D.A., Feijoo, F., Zayas-Castro, J.L. et al. A strategic gaming model for health information exchange markets. Health Care Manag Sci 21, 119–130 (2018). https://doi.org/10.1007/s10729-016-9382-2

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  • DOI: https://doi.org/10.1007/s10729-016-9382-2

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