SACRAMENTO, Calif. /California Newswire/ — Governor Schwarzenegger and California Health and Human Services Agency (CHHS) Secretary Kim Belshé today announced the state’s intent to name Cal eConnect as a new non-profit entity that will provide leadership and oversee a collaborative process to develop and support the Health Information Exchange (HIE) services in California.

“Building a world-class system like Cal eConnect to promote and expand the way information is shared is vital to protecting medical privacy, promoting efficiency and ultimately helping to reduce health care costs,” said Governor Schwarzenegger.

Under the American Recovery and Reinvestment Act (Recovery Act), at least $3 billion in enhanced Medi-Cal and Medicare payments are expected to be available in the years ahead for thousands of eligible California providers and hospitals that demonstrate they are participating in health information exchange in a meaningful way.

“The efficient and secure exchange of health information is fundamental to the future of health care delivery in our state,” Secretary Belshé said. “This new governance entity will help ensure that California is able to promote and expand the exchange of health information.”

Cal eConnect is an independent non-profit organization with both public and private board representation that will provide leadership and oversee a collaborative process to develop and support HIE services in California and lay the groundwork for receiving the additional stimulus funding. This organization will receive a grant from, and will be accountable to, the CHHS.

The new entity was formed when leaders from two California non-profits — the California eHealth Collaborative (CAeHC) and CalRHIO — submitted a joint proposal in response to a Request for Information (RFI) published by the CHHS on Aug. 29, 2009.

CHHS received seven proposals, and two organizations scored significantly higher than the others but did not meet all of the State’s criteria. In November, after detailed discussions with both organizations, they were asked to explore submitting a joint proposal and they agreed to a facilitated process with CHHS that would be led by board members from both organizations.

California Health and Human Services Deputy Secretary Jonah Frohlich said the joint proposal from the two entities is a good result for California.

“We believe a team combined of representatives from the state’s two leading health information technology organizations, as well as a diverse group of public and private board members, will be best able to advance the secure exchange of health information in our state,” Frohlich said.

The board of Cal eConnect will be co-chaired initially by David Lansky, CEO, Pacific Business Group on Health, and Don Crane, CEO, California Association of Physician Groups. Consistent with state law (SB 337 – Alquist), 22 board members will be selected from state government, private hospitals, public hospitals, medical groups, independent physicians, employers, private health plans, public health plans, consumers, health information exchange organizations, labor organizations, community clinics, and informatics.

Designation of a governance entity is a critical component of California’s Health Information Exchange Strategic Plan, and will be instrumental in supporting the grant California received from the U.S. Department of Health and Human Services (HHS) as part of the Recovery Act ( The grant is aimed at advancing California’s health information exchange across the state in a manner that ensures safe, secure patient and provider access to health information.

Cal eConnect will establish ground rules by which health information may be shared appropriately among hospitals, clinicians, plans, patients and government. It will also oversee and manage the implementation of HIE services throughout the state under the federal grant program and in accordance with the state requirements.

“Cal eConnect‘s focus will be to ensure that eligible hospitals and providers have access to health information exchange services, so that they may take full advantage of the electronic health record incentive program under the Recovery Act” said David Lansky CEO of Pacific Business Group on Health. “Our underserved and vulnerable populations and the eligible providers and hospitals who care for them are especially in need of these vital services and will be a priority.”

Don Crane of the California Association of Physician Groups said the Board will represent broad interests.

“Cal eConnect’s diverse stakeholder board, including significant representation from the safety net and consumers, will ensure that the needs of all constituents are heard and addressed,” he said. Official designation of Cal eConnect as the state’s HIE governance entity will require both federal approval under California’s grant, and acceptance of terms and conditions of a state grant agreement with them. The CHHS will gradually transition responsibilities to Cal eHealth Connect over the next six months, thereby allowing it to fully establish itself and develop policies and procedures to take on the full responsibility of the grant and its supporting activities.

Further information about Cal eHealth Connect and the Request for Information process is available at

Governor Schwarzenegger created the California Recovery Task Force to track the American Recovery and Reinvestment Act funding coming into the state; work with President Barack Obama’s administration; help cities, counties, non-profits, and others access the available funding; ensure that the funding funneled through the state is spent efficiently and effectively; and maintain a Web site that is frequently and thoroughly updated for Californians to be able to track the stimulus dollars.