Nextgov

The Kansas Health Information Exchange is dissolving itself and turning over operations to the state, pending approval by the state legislature.

The move will cut nearly $350,000 from the quasi-public exchange’s annual $400,000 operating budget, according to a report by the Kansas Health Institute. A federal grant funding exchange operations runs out in September 2013, the institute said. After that, the exchange had planned to charge fees to the networks it regulates.

"This is a way to get the state to have some skin in the game. Right now the only people who have skin in the game are (medical) providers," board member Jerry Slaughter said, according to the Health Institute report.

After exchange operations transfer to the Kansas Department of Health and Environment, by October 2013, the exchange’s 17-member board would serve as an advisory committee.

A similar organization in Tennessee voted to dissolve this summer after losing state funding.

In a report released in June, the Healthcare Information and Management Systems Society noted that as private health information exchanges emerge, state-run HIEs face challenges in sustaining themselves.

The “business of state HIEs will likely need to shift from ‘facilitator of sharing’ to ‘data aggregator and analyzer’ in order to build a sustainable business plan,” the HIMSS report concluded.