The economic benefits of health information exchange interoperability for Australia

Aust Health Rev. 2007 Nov;31(4):531-9. doi: 10.1071/ah070531.


Objective: To estimate costs and benefits for Australia of implementing health information exchange interoperability among health care providers and other health care stakeholders.

Design: A cost-benefit model considering four levels of interoperability (Level 1, paper based; Level 2, machine transportable; Level 3, machine readable; and Level 4, machine interpretable) was developed for Government-funded health services, then validated by expert review.

Results: Roll-out costs for Level 3 and Level 4 interoperability were projected to be $21.5 billion and $14.2 billion, respectively, and steady-state costs, $1470 million and $933 million per annum, respectively. Level 3 interoperability would achieve steady-state savings of $1820 million, and Level 4 interoperability, $2990 million, comprising transactions of: laboratory $1180 million (39%); other providers, $893 million (30%); imaging centre, $680 million (23%); pharmacy, $213 million (7%) and public health, $27 million (1%). Net steady-state Level 4 benefits are projected to be $2050 million: $1710 million more than Level 3 benefits of $348 million, reflecting reduced interface costs for Level 4 interoperability due to standardisation of the semantic content of Level 4 messages.

Conclusions: Benefits to both providers and society will accrue from the implementation of interoperability. Standards are needed for the semantic content of clinical messages, in addition to message exchange standards, for the full benefits of interoperability to be realised. An Australian Government policy position supporting such standards is recommended.

Publication types

  • Research Support, Non-U.S. Gov't

MeSH terms

  • Australia
  • Cost Savings
  • Cost-Benefit Analysis
  • Health Plan Implementation / economics
  • Humans
  • Information Systems / standards*
  • Medical Record Linkage / standards*
  • Medical Records Systems, Computerized / economics
  • Medical Records Systems, Computerized / standards*
  • National Health Programs
  • Program Development / economics
  • Systems Integration*