WHEREAS, the State of Kansas is committed to a health care delivery system that supports the secure exchange of health information for the purposes of ensuring quality, confidentiality, efficiency and effectiveness of patient-centered health care for all Kansans; and

WHEREAS, on July 24, 2009 the Governor of the State of Kansas identified the Kansas Department of Health and Environment (“KDHE”) as the state agency leading health information technology planning and implementation for the State of Kansas; and

WHEREAS, the American Recovery and Reinvestment Act of 2009 (“Recovery Act”) committed more than $2 billion to the Office of the National Coordinator for Health Information Technology (“ONC”) to ensure that all Americans have an electronic health record by 2014; and

WHEREAS, $34 billion in Recovery Act funding is dedicated for financial incentives to Medicaid and Medicare providers nationally for the adoption and meaningful use of electronic health records, and as such, the state has a compelling interest in assisting Kansas providers to qualify for those incentives; and

WHEREAS, ONC released a funding opportunity announcement August 20, 2009 based on the Recovery Act, Title XII – Health Information Technology, Subtitle B – Incentives for the Use of Health Information Technology, §3013, requesting states to take a lead role in the development and implementation of health information exchanges (“HIEs”) in the United States; and

WHEREAS, the stated purpose of this funding is to assist in the creation and implementation of the governance, policy and technical infrastructure, which will enable standards-based HIE and a high performance health care system; and

WHEREAS, it is envisioned that HIE will assist in widespread adoption and meaningful use of health information technology as one of the foundational steps in improving the quality and efficiency of health care, to ensure the appropriate and secure electronic exchange and consequent use of health information to improve quality and coordination of care as a critical enabler of a high performance health care system, and to facilitate and expand the secure, electronic movement and use of health information among organizations according to nationally recognized standards; and

WHEREAS, the State of Kansas was awarded funding amounting to $9,010,066 on February 12, 2010, through the State Health Information Exchange Cooperative Agreement Grant Program (“Program”) through the ONC; and

WHEREAS, the formation of a state-wide HIE is contemplated in the grant guidance and will be part of the final strategic and operational plan (“State Plan”) for Kansas under the grant; and

WHEREAS, the State Plan is due to ONC by August 31, 2010; and

WHEREAS, the Secretary of KDHE has promoted and the eHealth Advisory Council (“eHAC”), an advisory council formed by the Secretary of KDHE, recommended the formation of a not-for-profit, public-private partnership for the purpose of operating the Kansas Health Information Exchange consistent with the report of the Kansas Health Information Technology/Health Information Exchange Policy Initiative and the charge of the Kansas Health Information Exchange Commission (Executive Order 07-02) in coordination with state agencies and the Kansas Regional Extension Center.

NOW, THEREFORE, pursuant to the authority vested in me as Governor of the State of Kansas, I hereby establish the Kansas Health Information Exchange, Inc. (“corporation”) with the following purposes and charges:

1.         The Governor of the State of Kansas shall serve as incorporator of a body politic and corporate to be known as the Kansas Health Information Exchange, Inc. (“corporation”), a Kansas not-for profit corporation which shall be structured to qualify for tax-exemption as a charitable organization and as a supporting organization of the State of Kansas pursuant to §§501(c)(3) and 509(a)(3) of the Internal Revenue Code of 1986 as amended.  The Governor shall incorporate the corporation as soon as practical following the issuance of this order.

2.         The corporation shall act as a public instrumentality.  The corporation’s exercise of the authority and powers conferred by this order and pursuant to any contracts necessary between state agencies and the corporation to allow for the full oversight of the corporation in regards to the intent of this order shall be deemed and held to be the performance of an essential governmental function.

3.         The corporation shall have all the powers necessary to achieve the purposes specified herein, including the power to:

(a)        accept and receive grants, gifts, or donations of money, property, services, or other things of value from any public or private entity to be held, used, or applied for any or all of the purposes specified in this order;

(b)        establish administrative and accounting procedures for the operation of the corporation and enter into contracts as may be necessary under this order;

(c)        provide and pay the reasonable costs of operation of advisory committees established by the board pursuant to section 4 below. Such costs may include services and technical assistance that may be necessary or desirable to carry out the purposes of this order and such work as may be assigned to or requested of the advisory committee(s) by  the board.

(d)       subject to board approval, enter into contracts, agreements, interstate compacts, or other transactions with any federal, state, county, or municipal agency, or with any individual, corporation, private foundation, enterprise, association, or any other entity within or outside the state for the purpose of fulfilling its mission and duties;

(e)        appoint or employ staff, officers, consultants, agents, and advisors, and prescribe their duties and compensation;

(f)        promulgate and enforce standards for approval and operation of statewide and regional HIEs in the state including, but not limited to, rules regarding (a) access to and use and disclosure of protected health information maintained by or on an HIE, and (b) appropriate administrative, physical, and technical safeguards to ensure the confidentiality, integrity, and availability of protected health information maintained by or on an HIE; and

(g)        exercise any other powers necessary for the operation and functioning of the corporation within the purposes authorized in this order.

4.         The corporation shall be governed by a board of directors (“board”) comprised of residents of this state.  Upon incorporation and until such time as a board of directors is constituted pursuant to duly adopted bylaws of the corporation, the existing eleven-member steering committee of the eHAC shall act as the transitional board of the corporation, with the Secretary of KDHE acting as the chairperson of such transitional board.   The transitional board shall develop and approve bylaws for the corporation consistent with the provisions of this order and applicable law.  The transitional board shall continue to advise KDHE in development of the State Plan in collaboration with the eHAC.

5.         The board shall appoint 1 or more advisory committees to assure that the interests of the public and the stakeholders are represented.  Any such advisory committee shall be broadly representative and include health care providers (including providers who serve low income and underserved populations), health plans, patient or consumer groups, health information technology vendors, employers, public health departments, health professions training programs, schools and universities, clinical researchers, representatives of regional HIEs and other users of health information technology, including those involved in care coordination of patients.

6.         No part of the funds of the corporation shall inure to the benefit of, or be distributed to, its employees, officers or members of the board, except that the corporation may make reasonable payments for expenses incurred on its behalf relating to any of its lawful purposes and the corporation shall be authorized and empowered to pay reasonable compensation for services rendered to or for its benefit relating to any of its lawful purposes, including to pay its employees reasonable compensation.  Upon dissolution of the corporation, any assets remaining after the satisfaction of all the corporation’s obligations shall be paid over and become the property of the state and shall inure to the benefit of the residents of the State of Kansas.

7.         The corporation shall be subject to the Kansas open meetings act and the Kansas open records act, except that documents and other materials submitted to the corporation shall not be public records if such records constitute protected health information, are the types of records described by K.S.A. 45-221(a)(1) and (3) or are trade secrets under the uniform trade secrets act (K.S.A. 60-3320 et seq. and amendments thereto).

8.         The corporation shall not be subject to state purchasing laws.

9.         The Governor will submit the corporation to ONC for approval as the official state designated entity for the state of Kansas, replacing KDHE in this role and assuming responsibility for promoting an HIE program.  Fiduciary responsibility for the grant and the Office of the Health Information Technology Coordinator will stay with the state, through KDHE, as required by the ONC and the State HIE Cooperative Agreement Grant Program.

10.       Consistent with federal requirements, the corporation shall assure that an HIE is created, operated and maintained in the state for the exchange of health information state-wide, which shall:

a.         Facilitate the authorized and secure exchange of health information;

b.         Use information technology to improve health care quality and efficiency through the authorized and secure electronic exchange and use of health information enabling ongoing achievement of meaningful use;

c.         Connect regional health information exchanges and other stakeholders within the state to each other and to the Nationwide Health Information Network whenever it is established; and

d.         Connect subscribers to health information exchanges within and outside the state for the purpose of improving health care quality for individuals and patient populations.

11.       The corporation shall facilitate the implementation of the State Plan consistent with the requirements of §3013(e) of the federal public health service act, 42 U.S.C 201 et seq., and related guidance issued by the ONC.

12.       The corporation shall approve HIEs operating within the state consistent with sections 20 and 21 of this order with the intent of protecting the security, privacy and interest of the citizens of Kansas.

13.       The corporation may provide access to aggregated, de-identified health information, to be accessed for research purposes under such terms and conditions and subject to such controls, restrictions and limitations set forth in this order or as may from time-to-time be determined to be necessary or appropriate by the board.

14.       The board of directors of the corporation shall consist of fifteen (15) voting members and two (2) non-voting members for a total of seventeen (17) members as follows:

a.         The Secretary of the Kansas Department of Health and Environment; or his or her designee;

b.         The Executive Director of the Kansas Health Policy Authority, or his or her designee;

c.         The Governor of the State of Kansas, or his or her designee;

d.         2 members appointed by the Governor who represent consumers;

e.         1 member appointed by the Governor who represents employers;

f.          1 member appointed by the Governor who represents payers;

g.         1 member appointed by the Governor who represents local health departments from a list of 3 names submitted by the Kansas Association of Local Health Departments;

h.         3 members appointed by the Governor who represent hospitals, from a list of 3 names for each position submitted by the Kansas Hospital Association.  1 of the hospital representatives appointed herein shall be involved in the administration of a critical access hospital;

i.          3 members appointed by the Governor from a list of 3 names for each position by the Kansas Medical Society.  At least one of the physicians appointed herein shall be a physician in a primary care specialty;

j.          1 member appointed by the Governor who represents pharmacists, from a list of 3 names submitted by the Kansas Pharmacists Association;

k.         1 member, who shall be nonvoting, shall be a representative of the University of Kansas Center for Health Information; and

l.          1 member, who shall be nonvoting, shall be a representative of the Kansas Health Information Technology Regional Center.

15.       Voting members of the board appointed pursuant to subsection 11 of this order shall serve for terms of 4 years, and shall be eligible for re-appointment, but voting members of the board shall not be eligible to serve more than 2 consecutive four-year terms.  The members first appointed by the Governor shall serve for terms of 2 years.  Upon the expiration of the terms first appointed by the Governor, the Governor shall appoint members to serve for terms of 4 years.  Whenever a vacancy occurs regarding a member of the board due to the resignation, death, removal, or expiration of a term, such member shall be appointed according to the process and to the specific position on the board as described in Section 13 of this order  In the event of a vacancy during an expired term due to resignation, death or removal of a board member, the appointment shall be for the remainder of the unexpired portion of the term.  Each member of the board shall hold office for the term of appointment and until a successor has been appointed.  Any member of the board other than a nonvoting member may be removed by the Governor for malfeasance or misfeasance in office, regularly failing to attend meetings, or for any cause which renders the member incapable of the discharge of the duties of director.

16.       The board shall meet at least 4 times per year and at such other times as it deems appropriate, or upon call by the chairperson.  The board shall make, amend, and repeal bylaws, standards, procedures, and rules and regulations for the management of its affairs, not contrary to law or inconsistent with this order, as it deems expedient for the governance and management of the corporation and the operation of the health information exchanges authorized herein.

17.       The board shall elect a voting member as chair and at least one other voting member as vice-chair annually.  The board shall also elect a secretary and treasurer for terms to be determined by the board.  The board may elect the same person to serve as both secretary and treasurer.  The board may establish an executive committee and other standing or special committees, and prescribe their duties and powers.  Any executive committee of the board may exercise all such powers and duties of the board as the board may delegate.

18.       Members of the board are entitled to compensation and expenses as provided in K.S.A. 75-3223, and amendments thereto.  Members of the board attending board meetings or subcommittee meetings authorized by the board shall be paid mileage and all other applicable expenses, provided such expenses are consistent with policies established from time-to-time by the board.

19.       The board shall adopt nondiscrimination and conflict of interest policies that demonstrate a commitment to open, fair, and nondiscriminatory participation by stakeholders.

20.       The corporation shall promulgate standards for approval of and operation of statewide and regional HIEs in the state which shall be designated as “approved HIEs” including, but not limited to, the following:

a.         Satisfaction of certification standards for health information exchange promulgated by the federal government;

b.         Adherence to national recognized standards for interoperability;

c.         Adoption and adherence to rules promulgated by the corporation regarding access to and use and disclosure of protected health information maintained by or on a health information exchange;

d.         demonstration of adequate financial resources to sustain continued operations in compliance with the aforementioned standards, rules and safeguards;

e.         participation in outreach activities for individuals and covered entities;

f.          conduct of operation in a transparent manner to promote consumer confidence;

g.         implementation of security breach notification procedures; and

h.         development of procedures for entering into and enforcing the terms of participation agreements with covered entities which satisfy the requirements established by the corporation.

21.       The corporation shall establish and implement:

(a)        a process by which an HIE may apply for and receive approval by demonstrating compliance with the standards promulgated by the corporation pursuant to sections 18 and 19 of this order;

(b)        a process by which an approved HIE shall be re-approved on appropriate intervals by demonstrating continued compliance with the standards promulgated by the corporation pursuant to sections 18 and 19 of this order; and

(c)        a process for the investigation of reported concerns and complaints regarding an approved HIE and imposition of appropriate remedial and proactive measures to address any identified deficiencies.

(d)       a process whereby  the Kansas department of health and environment, the Kansas health policy authority, the Kansas department of social and rehabilitation services and other state agencies, including regulatory agencies responsible for licensing and disciplining health care providers may access protected health information maintained by or on an approved HIE, to the extent such agencies are authorized by state or federal law to access such protected health information to carry out their respective duties under applicable law, and whereby these agencies will be able to use the HIE to carry out their statutory responsibilities as consistent with this order.

22.       Any HIE which is not an approved HIE shall not be eligible for any financial support from the state, or assistance from the state in application for federal funding.

23.       An approved HIE shall not be compelled by subpoena, court order, or otherwise, to disclose protected health information relating to an individual.

24.       No use or disclosure of protected health information maintained by or on any approved HIE shall be made except pursuant to rules adopted by the corporation consistent with this order.  The assets of the corporation shall be used solely for the purposes of the corporation as established by this order.

25.       The corporation, in collaboration with departments and agencies of state government, may establish a loan and grant program to provide for the capitalization of electronic medical records systems for eligible health care providers.  Health information technology acquired under a grant or loan authorized by this section shall comply with federal standards for meaningful use.  An implementation plan for this loan and grant program may be developed which shall be consistent with the State Plan.

26.       The corporation shall publish an annual report which shall include an audit in accordance with generally accepted accounting principles as of the close of each fiscal year of the corporation.  The corporation shall present a report to the Governor and the legislature, setting forth in detail, the operations and transactions conducted by it pursuant to this order.  The corporation shall distribute its annual report by such means that will make it widely available to the public.

This document shall be filed with the Secretary of State as Executive Order No. 10-06 and shall become effective immediately.