Network Effects in Health Information Exchange Growth

Abstract

The importance of the Healthcare Information Exchange (HIE) in increasing healthcare quality and reducing risks and costs has led to greater interest in identifying factors that enhance adoption and meaningful use of HIE by healthcare providers. In this research we study the interlinked network effects between two different groups of physicians -- primary care physicians and specialists -- as significant factors in increasing the growth of each group in an exchange. An analytical model of interlinked and intragroup influences on adoption is developed using the Bass diffusion model as a basis. Adoption data on 1,060 different primary and secondary care physicians over 32 consecutive months was used to test the model. The results indicate not only the presence of interlinked effects, but also that their influence is stronger than that of the intragroup. Further, the influence of primary care physicians on specialists is stronger than that of specialists on primary care physicians. We also provide statistical evidence that the new model performs better than the conventional Bass model, and the assumptions of diffusion symmetry in the market are statistically valid. Together, the findings provide important guidelines on triggers that enhance the overall growth of HIE and potential marketing strategies for HIE services.