The Politics of HIE

Why advancing interoperability isn’t about technology—it’s about process, trust, power, and purpose.

Every few years, we dust off the word interoperability like it’s the next big thing. We celebrate new initiatives, announce frameworks, and promise that this time the data will finally move. Yet more than a decade after the first big wave of HIE investment, behavioral health and social care data still sit in silos.

I’ve led three HIE efforts across the country — statewide, regional, and behavioral-health focused — and every single one faced the same challenge. The roadblocks were never really about people or technology. They were about politics and process: how decisions get made, who gets to make them, and how slowly things move once the politics start.

A Decade of Déjà Vu

When behavioral health and substance use disorder (SUD) exchange first hit the national radar, many of us thought it would be the turning point — the proof that interoperability could finally make a tangible difference in people’s lives.

I was part of the first (and really only) dedicated behavioral health information exchange in the country. We didn’t just talk about integrating behavioral health data; we did it. We built a system that connected community mental health providers, crisis services, inpatient facilities, and medical systems — and we did it while fully complying with 42 CFR Part 2.

It wasn’t easy. The privacy rules were strict, the trust-building was painstaking, and the technology wasn’t half as flexible as what we have today. But it worked.

That was more than ten years ago. And yet, here we are — still having the same debates, still hesitating to share behavioral health data, and still hearing that 42 CFR Part 2 makes it “too complicated.”

The irony is that the law has loosened considerably since then. Consent models are more flexible, redisclosure is more clearly defined, and integration with HIPAA is more straightforward.

If we could do it under the old rules, shouldn’t everyone be able to do it now?

Some HIEs have made progress — several now include behavioral health data in their exchange networks. But many still stop short of incorporating SUD data. Many simply choose not to deal with it at all, citing lingering confusion or legal risk.

It’s understandable. But it’s also a missed opportunity to connect care for the people who need it most.

Process Over Progress

Health data doesn’t stay siloed because it can’t move. It stays siloed because the processes to move it are slow, fragmented, and bureaucratic.

Every organization has a reason to hesitate: privacy counsel wants more legal review, vendor contracts require custom interfaces, funding cycles don’t align. Individually, these are reasonable precautions. Collectively, they become barriers to care.

It’s how a patient can show up in the emergency room for the third time this month — and no one in the system realizes it’s part of the same crisis.

The Mission That Met the Marketplace

Before my foray into health IT, I created and ran a non-profit technology-based program that helped high school dropouts earn their diplomas. That experience taught me something simple but profound: technology only matters if it changes someone’s life.

That’s the lens I brought into HIE work. These exchanges were meant to be public goods — connecting fragmented systems and improving care coordination across communities.

But somewhere along the way, the mission collided with the market.

Hospitals began viewing data as an asset, not a shared resource. Vendors started monetizing every interface and API. The narrative shifted from “connecting care” to “protecting position.”

Today, behavioral health, social care, and crisis systems remain on the periphery of interoperability — not because they lack value, but because they lack leverage.

The Funding Paradox

Most HIEs are nonprofits built to serve communities, not to generate profits. Their two largest expenses — technology and staffing — don’t necessarily scale down when the service area is smaller.

In the early years, hospital fees and grants kept things running. But as health systems built internal capabilities, they began questioning why they should continue funding “external” infrastructure.

That logic misses the forest for the trees. HIEs now carry out vital functions hospitals depend on: disease reporting, immunization exchange, syndromic surveillance, overdose tracking, and crisis alerts. Without HIEs, each hospital would need multiple staff to manage those connections individually.

Yet HIEs struggle to receive sustained public funding or recognition as the utilities they are.

Mandates: The Policy Lever No One Likes to Pull

There’s one lever that has actually worked: mandates.

In states like Connecticut, North Carolina, and California, providers are required to connect to a designated HIE or participate in statewide data exchange frameworks.

Mandates aren’t popular — California’s Data Exchange Framework (DxF) initially met plenty of resistance. However, they’ve moved the needle farther than voluntary participation ever did.

Mandates create consistency. They push past inertia. They make interoperability the default, not the exception.

But mandates also need funding to be effective. Without financial support, smaller providers struggle to comply, and enforcement becomes uneven.

Even with their imperfections, mandates have forced collaboration in ways nothing else has. Without them, too many organizations simply opt out — and the result is predictable: gaps in the data picture that make “whole-person care” impossible.

When Good Intentions Collide with Bad Incentives

The politics of HIE are complicated by mixed motives. Some organizations proudly wave the interoperability flag while quietly monetizing data. Others block sharing under the guise of privacy while using the same data internally for competitive analytics.

Every time that happens, trust erodes.

For nonprofit HIEs operating transparently under community governance, this behavior isn’t just frustrating — it’s destabilizing. It confuses the public, undermines confidence, and makes it harder for ethical organizations to gain traction.

If public funds are supporting infrastructure, the data flowing through it should serve public good. Otherwise, we’re just subsidizing gatekeeping.

The Vendor Vortex

Vendors are another sticking point in the interoperability process.

Interface setup fees, “custom” configurations, and perpetual maintenance costs have become industry norms — even though most interfaces today are standardized and repeatable.

This creates an uneven playing field. Large health systems can afford the costs; small behavioral health clinics and community organizations cannot. The result is digital inequity at the very front line of care.

We shouldn’t still be reinventing the wheel every time a new connection is needed. The technology exists — what’s missing is the will to streamline and standardize.

The Public Utility We Refuse to Fund

If your city made every household negotiate its own power hookup, it would be chaos. Yet that’s exactly how we handle health data.

HIEs function as public utilities, connecting hospitals, clinics, behavioral health agencies, EMS, corrections, and public health. But they aren’t funded like utilities — they’re funded like nonprofits chasing project grants.

That’s why progress remains piecemeal. Sustainable, multi-year funding tied to measurable outcomes would stabilize operations and encourage innovation. Instead, we keep forcing HIEs to prove their value year after year while expecting them to carry the infrastructure for everyone else.

Getting Out of Our Own Way

We don’t lack technology in this country. We lack alignment.

We have national standards, flexible regulations, and proven success stories. What we don’t have is a coordinated process to bring them together.

Every stakeholder says they want interoperability, but each defines it on their own terms. Hospitals want control. Vendors want revenue. Governments want compliance. HIEs just want to connect the dots.

The fix isn’t new technology — it’s redesigning the process:

• Streamline governance to make decisions faster and clearer.

• Align funding with function, treating HIEs as infrastructure.

• Standardize connections to reduce costs and friction.

• Mandate responsibly, and fund it fairly.

The Real Definition of Interoperability

Interoperability isn’t about servers, APIs, or data formats. It’s about accountability — to patients, to communities, and to each other.

When it works, data moves, care connects, and outcomes improve. When it doesn’t, we spend another decade talking about why.

The behavioral health HIE we built over ten years ago proved it can be done — securely, ethically, and at scale. The question now isn’t whether we can exchange sensitive data. It’s whether we’ll choose to make it the norm.

Because the “last mile” of interoperability isn’t a technical distance anymore. It’s a political one.