About 60 health systems are siding with Epic Systems against the HHS' proposed data-sharing rules

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In late January, Epic CEO Judy Faulkner emailed the CEOs and presidents of Epic's health system customers, urging them to oppose the Department of Health and Human Services' (HHS) proposed interoperability rules aimed at making it easier for patients to obtain their medical information and share it with apps - and approximately 60 health systems have currently done so, according to CNBC.

For context, the HHS proposed two rules - the first would require companies to improve EHR interoperability to allow providers to share patient data externally, and the second would give patients direct access to their medical data via third-party applications.

But health systems are split on whether they agree with Faulkner's opposition of the HHS' rules - and tech giants are among those in favor of the HHS' rules:

The health systems that have signed Epic's letter opposing the HHS' proposed rules cite patients' data privacy as their main concern. Among the US health systems that have signed the letter are NYU Langone Health in New York and University Health System in Texas.

And several life sciences firms also signed, while a handful of organizations penned their own separate letter in opposition of the data-sharing rules, per CNBC. Some of their concerns were centered around patient data privacy: For example, Faulkner argued that the HHS' data-sharing stipulations don't include sufficient protections for patient privacy, and giving patients direct access to their medical data via third-party apps could leave this data exposed to exploitation.

We think Epic may be particularly interested in protecting patient data privacy to protect itself from the backlash a potential scandal would drum up: For instance, in late January, the EHR giant reached out to its hospital clients to inform them that it would be halting integrations with Google Cloud - possibly due in part to Google's involvement in the Project Nightingale scandal, in which Google accessed Ascension patient data without the knowledge of patients or physicians.

But notably, some of Epic's largest health systems clients did not sign the letter - suggesting these providers may think the benefits of the proposed rules outweigh the potential cons. David Brailer - the first National Health Information Technology Coordinator - said "many health systems are quietly discussing how the data access and data fluidity actually benefits them in the long-run," per CNBC.

For instance, enhanced interoperability can open up patient's medical records to their entire care teams, which can drive improved health outcomes and reduce costs for providers: Running duplicate tests and doling out unnecessary treatments costs the US $200 billion annually, for example.

Meanwhile, tech giants Apple and Microsoft recently joined a call with nonprofit organization Carin Alliance to discuss ways to get the proposed rules finalized and released, per CNBC. However, it's important to note that Apple and Microsoft could be motivated by different factors, as the tech giants could stand to gain financially should the proposed rules become approved. For example, Apple is leveraging its Health Records app to create a one-stop hub for patients to keep and sort through their health info - which holds promise for alleviating provider organizations' persistent interoperability problems.

While US health systems appear to be at a standstill around how to make data sharing work for them, we think there are several ways to make interoperability an attractive proposition across the board. To address data privacy concerns, additional stipulations aimed at protecting patients' privacy could be introduced to the proposed rules as they currently stand.

Further, Faulkner stated in her letter that "... the timeline for compliance, and the significant costs and penalties will make it extraordinarily difficult for us to comply," according to CNBC. These concerns could be addressed through some compromise - while Faulkner requests at least 12 months to prepare and 36 months for "development of new technology required by the rule," per CNBC, more aggressive timelines could be implemented with the option to delay penalties for firms that don't meet the expedited timelines, granted they meet compliance requirements within a set period of time.

Nevertheless, we're interested to see what compromises, if any, health systems are willing to make when it comes to the HHS' proposed rules - and what the future holds for healthcare interoperability.

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