Part 3: The Pros and Cons of Interoperability Frameworks in Health Care

Written by: Corliss Collins, BSHIM, RHIT, CRCR, CCA, CAIMC, CAIP, CSM, CBCS, CPDC and Dr. Tami M. Harris, DM, PMP, LSSBB 

Introduction 

Interoperability frameworks are the connective tissue of modern healthcare data exchange, defining how systems communicate, the structure of the data, and how information flows securely across organizations.

As healthcare organizations – including hospitals, payers, clinicians, and technology vendors – face significant challenges to deliver care in an environment dominated by fragmented data, siloed and competing systems, the push to standardize how information is exchanged has taken center stage. These frameworks offer a pathway toward a more connected healthcare ecosystem—one where patient medical records are transmitted securely, providers have timely access to essential information, and organizations can reduce the inefficiencies that drive patient care, increased costs, lost or duplication of data, and delays.

In the AIHC Part 1 Article on Interoperability: CMS Interoperability Framework Project: Should We Be Concerned?  A comprehensive overview dives into  the Problem with System Fragmentation in Healthcare and Security Concerns in the CMS Interoperability Framework Project (Part 1).

In the AIHC Part 2 Article: Interoperability and System Fragmentation in Healthcare, the contributing writers discuss Communication, Compliance, and Strategies for Successful Integration Interoperability and System Fragmentation in Healthcare (Part 2).

In this AIHC Part 3 Article, we will now walk the readers through the Pros and Cons of Interoperability Frameworks in Healthcare. As AI, Revenue Cycle Management (RCM) automation, payer auditing, and value-based care accelerate, these frameworks are rapidly becoming the backbone of national healthcare operations.

But like any key technology standard, these frameworks come with real advantages—and real trade-offs. Below is a practical, balanced breakdown that leaders should understand before deciding to adopt or move forward with how they will integrate these systems.

Pros & Cons - Let’s Start with the Pros

1. Exchange of Data Between Systems

Data Exchange interoperability frameworks, such as Health Level 7 (HL7), Fast Healthcare Interoperability Resources (FHIR), and Trusted Exchange Framework and Common Agreement (TEFCA), will help reduce fragmentation by providing a common language for AI-Powered Electronic Medical Record (EMR) systems, RCM platforms, and payer applications.

According to the Centers for Medicare & Medicaid Services (CMS), the Voluntary Interoperability Frameworks are designed to enhance manual back-and-forth, enable faster claims processing, reduce denials, and improve clinical decision-making.

Why it matters - Unconnected systems, duplicate documentation, and lost data cost hospitals millions of dollars every year. Current CMS estimates indicate that interoperability frameworks can shrink those losses by streamlining data exchange and minimizing manual errors. Integrating data into EHRs demonstrates the growing impact of interoperability frameworks on reducing fragmentation.

2. Stronger Clinical Quality and Patient Safety

With data flowing unimpeded, clinicians have a complete picture of labs, meds, allergies, imaging, and histories—regardless of where care was delivered. This improves the accuracy of care, reduces avoidable errors, and supports real-time decision-support tools.

A Forward-Thinking Angle - AI-enabled audits in Clinical Documentation Improvement (CDI) and RCM are most effective when built on interoperable data. Interoperability should be the prerequisite for advanced analytics and real-time clinical decision support.

3. Reduce Operational Waste and Administrative Burden

Implementing CMS Voluntary Frameworks, such as CMS 9115-f , automates and streamlines much of the documentation exchange, eliminating repetitive reconciliation, data entry, and faxing.

The CMS Interoperability and Patient Access Final Rule require payers to use FHIR-based APIs for data exchange, which has proven to reduce prior authorization response times and administrative costs for providers.

Impact - Minimize human touchpoints → fewer mistakes → shorter AR cycles → more cash collected faster.

4. Better Compliance with Federal Requirements

The goal is to minimize risk by leveraging the Assistant Secretary for Technology Policy and the Office of the National Coordinator for HealthIT’s (ASTP/ONC) Interoperability Frameworks, such as HL7, FHIR, CMS interoperability rules, and TEFCA, by aligning organizations with regulatory expectations for data access, patient API rights, and cross-network exchange.

TEFCA, launched in 2024, establishes a nationwide framework for secure health information exchange, connecting providers, payers, and public health agencies. Compliance with TEFCA and FHIR standards is now required for participation in federal programs and for avoiding penalties.

Bottom line - Staying compliant now avoids future penalties and positions organizations to participate in larger national data networks.

5. Fuel for AI, Predictive Analytics, and RCM Algorithms

AI models thrive on clean, structured, standardized data (Federal Register, Health Data).
Interoperability frameworks give organizations the quality inputs needed for:

• Automated Claims Integrity Checks
• Audit Ready Data Pipelines
• Predictive RCM Drift Alerts
• CDI optimization
• Denials Prediction

The FDA and CMS are piloting FHIR-based submissions for real-world data, enabling advanced analytics and predictive modeling for population health and revenue cycle management.

Forward-Looking Reality - Organizations that implement interoperable data models today are better positioned to lead tomorrow’s AI-enhanced revenue cycle and clinical innovation.

The Cons

1. High Upfront Cost and Long Implementation Time

Implementing interoperability is not a simple upgrade. Many organizations underestimate the scale and cost, leading to project delays and budget overruns. Interoperability initiatives require:

• API Integration
• Data Mapping
• Security Upgrades
• Staff Training
• Vendor coordination
• Workflow Redesign

Truth - Interoperability is not a plug-and-play upgrade—it will be transformational.

2. Legacy System Limitations

Legacy systems often; lack support for modern APIs, contemporary data formats, or real-time exchange. These outdated platforms create bottlenecks, limit adoption, and increased maintenance costs.

Real-World Impact - Even if one part of the RCM process is modernized, the weakest legacy interface can undermine the entire process.

3. Cybersecurity Risks Rise with Connectivity

Expanding connectivity through APIs and cross-organizational networks increases the risk of cyber threats. The U.S. Department of Health & Human Services (HHS) emphasizes that interoperability must be paired with robust cybersecurity measures to protect sensitive health information.

Forward risk - AI-powered cyberattacks target health care's interconnected data ecosystems. Interoperability without hardened defenses is dangerous.

Organizations will need to ensure stronger access controls, encryption, and incident response plans are in place for threat prevention.

4. Vendor Resistance and Proprietary Barriers

Some vendors still rely on closed or proprietary systems to “lock in” clients, making interoperability expensive or technically challenging. This practice can significantly hinder the seamless exchange of health information across organizations.

The ONC has repeatedly identified proprietary interfaces and lack of standardized APIs as major obstacles to nationwide interoperability. Proprietary health IT systems continue to present significant challenges to data sharing. These systems often require organizations to invest in costly custom integrations, which can result in persistent information silos.

Result - Organizations can get stuck negotiating costly interface fees or dealing with partial data exchange, which not only increases operational expenses but also limits the ability to provide coordinated, high-quality care.

5. Variation in Standards and Inconsistent Adoption

Even with frameworks like FHIR (HL7 FHIR) or TEFCA (TEFCA Governance), vendor implement differently.  There are variations in:

• API Maturity
• Profiles
• Optional Fields Versioning
• Create Ongoing Friction

Reality - Interoperability is only as strong as the weakest implementation in the network. The ONC Interoperability Standards Advisory underscores the need for consistent implementation and highlights gaps in adoption across the industry.

Interoperability frameworks are rapidly becoming the backbone of a modern, connected healthcare ecosystem, offering benefits that extend well beyond simple data exchange —yet their impact is far from one-dimensional. Throughout this three-part AIHC series, we have explored the real and persistent challenges of system fragmentation, the security vulnerabilities exposed by national initiatives such as the CMS Interoperability Framework Project, and the practical strategies organizations can use to navigate and overcome communication and compliance barriers.

In this Part 3 article, we explored the significant advantages and real trade-offs that interoperability frameworks bring. These standards promise faster access to patient information, improved care coordination, and greater operational efficiency.  At the same time, it is important to realize that these benefits of interoperability in healthcare require rigorous governance, robust security, disciplined integration planning, and adaptability to evolving federal and state requirements, including market pressures Understand Interoperability in Healthcare.

As AI in RCM automation, payer oversight, and value-based care continue to accelerate, interoperability will become increasingly critical. Operational leadership that succeeds will be those who embrace connectivity with strategic foresight—leveraging the advantages while proactively managing the associated risks. 

Interoperability should be viewed not just as a technology requirement; it should be considered the de facto strategy and standard that will shape how healthcare delivers value, safeguards patients, and competes in a data-driven future.

About the Authors

Corliss Collins, BSHIM, RHIT, CRCR, CCA, CAIMC, CAIP, CSM, CBCS, CPDC, is the Founder, Principal & Managing AI Consultant of P3 Quality, a Healthcare Tech Consulting Company. She is a Certified Artificial Intelligence Professional (CAIP) and a Certified Artificial Intelligence Medical Coder (CAIMC). In her current leadership role, she extracts and diagnoses core Drift in AI Medical Coding Models, thereby closing AI-Driven financial, quality, and compliance gaps. Corliss is also a published author of Artificial Intelligence, Rise, Survive, & Thrive In An AI-Powered World. She also serves on the AIHC Volunteer Education Committee.

Dr. Tami M. Harris, DM, PMP, LSSBB, is the Founder & Chief Operating Officer of H & H Consulting Group, Inc. With a doctorate in Management, she is recognized as a certified Lean Six Sigma Black Belt and Project Management Professional, reflecting a commitment to operational excellence and continuous improvement. In her current capacity as Portfolio Director for Middle and Back-office Revenue Cycle Management (RCM) AI Automation and Transformation, she leads strategic advisory initiatives, oversees practice leadership, and drives client engagement delivery to generate new value-streams through technology.

References:

1. American Health Information Management Association. (2024). TEFCA Overview. AHIMA. https://www.ahima.org/
2. Centers for Medicare & Medicaid Services (CMS). Interoperability and Patient Access Final Rule (CMS-9115-F). https://www.cms.gov/cms-9115-f
3. Food and Drug Administration. (2025). Exploration of Health Level Seven Fast Healthcare Interoperability Resources for Use in Study Data Created From Real-World Data Sources for Submission to the Food and Drug Administration; Establishment of a Public Docket; Request for Comments. Federal Register, 90(77), 17067–17069. https://www.federalregister.gov/documents/2025/04/23/2025-06967/exploration-of-health-level-seven-fast-healthcare-interoperability-resources-for-use-in-study-data
4. HL7 International. FHIR Overview. https://www.hl7.org/fhir/
5. National Academy of Medicine. Proposing Interoperability Standards for Healthcare. https://www.federalregister.gov/algoritm-transparency
6. Office of the National Coordinator for Health Information Technology (ONC). Interoperability Standards Advisory (ISA). https://www.healthit.gov/isa
7. The Sequoia Project. TEFCA Framework and Common Agreement. https://sequoiaproject.org/tefca/
8. Understand the four levels of Interoperability in Healthcare. www.wolterskluwer.com
9. U.S. Department of Health & Human Services. (2024). Cybersecurity Program. https://www.hhs.gov/about/agencies/asa/ocio/cybersecurity/index.html

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