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Director Jeppesen’s retirement from Health & Welfare should not end scrutiny of scandals

Director Jeppesen’s retirement from Health & Welfare should not end scrutiny of scandals

Fred Birnbaum
November 21, 2023
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November 21, 2023

Idaho Health and Welfare Director Dave Jeppesen’s recent retirement announcement followed the previous week’s Joint Finance and Appropriation Committee (JFAC) fall budget review. We can’t be sure that the two are connected, but there were two damaging reports tied to Health and Welfare under his leadership. 

IFF has covered one of the scandals related to improper grants here, Idaho Health Agency Boss Needs To Go Following Embarrassing Audit - Idaho Freedom, and here Independent audit finds state agency defied Idaho law to distribute public funds to woke pre-K and childcare providers - Idaho Freedom.

Another major blow was delivered last week with the review of the 2022 bankruptcy of the Idaho Health Data Exchange (IHDE). This review was requested by JFAC Co-Chair Senator Scott Grow and four other legislators, including House Speaker Mike Moyle and Minority Leader Ilana Rubel. The review scope related largely to the bankruptcy, oversight, and what the state could do moving forward. The major issues covered in the report included structure, governance, and oversight of the failed exchange. And the report was thorough in that regard.

Not covered was whether the exchange was appropriate in the first place or what actual deliverables were achieved for $93.3 million “invested.” The review was conducted by the Office of Performance Evaluation (OPE), and their report is available here.

What is the IHDE, and why does its bankruptcy matter? Put simply the IHDE is a Health Information Exchange that puts Idahoans’ private medical data into a shared database — with the implied consent of every Idahoan. Idaho is an opt-in state meaning that unless a person opts out, their medical data goes into the exchange. Did you consent to having your private medical records shared in a database that public health agencies can access? I didn’t think so. This notion has been pushed by the federal government with the stated objective listed on page 15 of the report.

“The purpose of creating Idaho’s health information exchange (HIE) was to facilitate the availability of electronic health records to improve quality of patient care, decrease duplication of tests and services, and monitor population health to guide policy decisions.”

So, these exchanges can be used to nationalize healthcare policy to a greater extent than it is now nationalized. With the experiences of COVID policy, who thinks that is a good idea?

The report meticulously details the deficiencies in the governance structure as IHDE was set up as a non-profit 501(c)6. Meaning that it was structured to get public funding but with limited oversight from Health and Welfare. Perhaps this was intended by the cross-section of “Big Medicine” stakeholders or was just an oversight. In any case, what we do know is that the exchange absorbed $93.3 million of public funds, 98% of which were provided by the federal government. Of the $91.5 million provided by the feds, $64.9 million went to healthcare providers to “encourage them to develop their systems for electronic health records.”

But what the report does not tell us, is which providers got exactly how much money for precisely what services. These providers are not shielded from scrutiny because they were not paid by the exchange but by the Department of Health and Welfare directly.

As noted on page 18:

“We found that the Department of Health and Welfare also supported the Idaho Health Data Exchange with in-kind support until at least 2017. This included equipment, supplies, and an office in the Health and Welfare building, initially on the 10th floor near the director’s office. Three active directors of Health and Welfare sequentially served as board members of the exchange from its inception in 2008 until 2021.”

So, additional scrutiny of the payments of at least $64.9 million is warranted.

Where does the Idaho Legislature fit into all of this? ”In 2006, the Legislature created the Health Quality Planning Commission to lead the development of a statewide health information technology (IT) system,” according to the report. However, as the funding stream was both mostly federal dollars and buried in the giant H&W budget — now over $5 billion — it wasn’t on the radar. 

All that changed in 2020, per page 35 of the report:

“In 2020, the Legislature appropriated $19.5 million in federal SUPPORT Act funding for the Department of Health and Welfare’s Division of Medicaid to improve the exchange and enroll new providers. During debates, legislators raised concerns about sending any more public dollars to the exchange, which they had hoped would be operating only on user fees by then. The Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act, or SUPPORT Act, provided grants for improving access to prescription drug monitoring programs to prevent or decrease the misuse of prescribed controlled substances, including opioids.”

The Idaho Freedom Foundation called this out in reviewing Senate Bill 1393 - Department of Health and Welfare, supplemental - Idaho Freedom Senate Bill 1393, the Fiscal Year 2020 (FY20) supplemental, that was up for consideration back in March 2020. It provided an additional $16 million to the IHDE, (the other $3.5 million appropriation was contained in the main Medicaid bill). 

“It appropriates $16 million of federal money to set up the Idaho Health Data Exchange. Even supporters of this exchange concede its myriad startup problems. However, what is especially bothersome is the line item described as,  “IHDE Connections - Opioids.” Put simply, this project would put every citizen of Idaho’s health care records into one electronic data-base that the Medicaid Division would have access to. All of the private medical records of every Idaho citizen will be visible to certain government employees. The notion that this is necessary to “combat the opioid crisis,” is a shameful rationale for this massive invasion of privacy. Finally, it must be noted that having everyone’s medical records in one database will make it much easier to transition to a government-run health care system. There is no necessity for this line item to be included in the Medicaid supplemental.” 

And if the poor management of money is not troubling enough, what is particularly bothersome is that according to page 43 of the report, the security of people’s private medical data is not assured:

“The department’s health IT contractor, chief information officer, and chief information security officer still did not believe the exchange had sufficiently documented meeting data security requirements after the contract ended. Federal CMS officials agreed. The department disconnected the exchange from the state immunization and behavioral health databases in November 2020. After consulting with the department’s IT experts, privacy officer, and Deputy Attorney Generals, department officials also filed a complaint about security concerns with the federal Office of Civil Rights to limit the state’s liability if there were a data breach.”

For readers of this article who are sufficiently concerned, here is a form to opt out of the IHDE.

As the report notes as to actions going forward, on page 55:

“[T]he federal government has developed optional nationwide standards. The Office of the National Coordinator for Health Information Technology developed the Trusted Exchange Framework and the Common Agreement (TEFCA) to standardize data privacy expectations, simplify connectivity, and increase exchange of EHRs in 2022.55 The office established standards for organizations that want to become designated as Qualified Health Information Networks (QHINs) under TEFCA.”

Simply put, the federalization of our private medical data is on the march with the end goal of a top-down federal government-directed healthcare system, with states and hospitals as administrative units of this giant edifice.  

The bankruptcy of the IHDE should serve as a wake-up call to Idaho’s Legislature and the people of Idaho about the dangers of so-called public-private partnerships marching into the state’s healthcare system. This initiative was fueled by federal dollars and did not get the scrutiny it deserved. The Legislature, and possibly the Attorney General, need to do further research into exactly where the money went and possibly what relationships exist between various H&W employees, former employees, and recipients of the nearly $100 million investment by taxpayers. 

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