TEFCA Health Tech Implementation: Navigating Provider Interoperability Challenges

Health technology leaders are discovering that TEFCA implementation comes with significant challenges that weren't obvious during the planning stages. The gap between TEFCA's theoretical promise and operational reality has left many CIOs reconsidering their strategies. 

‍

This guide explores the actual state of TEFCA deployment and provides strategic guidance for navigating these complexities.

‍

Understanding TEFCA's Current Provider-Centric Focus

‍

TEFCA's architecture reveals something many health tech leaders discover only after deeper investigation. This isn't a universal interoperability solution for all healthcare stakeholders. The framework was deliberately designed with provider organizations at its center, creating both opportunities and limitations depending on where an organization sits in the healthcare ecosystem.

‍

Provider-to-provider data exchange as primary use case

‍

In its first phase, TEFCA largely centers on facilitating clinical data sharing between healthcare providers for treatment purposes. The initial QHIN implementations support query-based exchange of patient records, capabilities that many providers already use via existing networks. 

‍

As one analysis noted, TEFCA's early impact on clinical workflows is incremental, offering providers another pathway to query records rather than dramatically expanding data sharing types.

‍

The framework currently supports treatment and individual patient access as operational exchange purposes, while more advanced scenarios like payer-based exchanges or public health reporting remain in pilot stages. If an organization operates primarily in the provider space needing to share patient records with other hospitals or clinics, TEFCA aligns well. But if working on payer integration, population health analytics, or consumer-facing applications, the current framework may feel incomplete.

‍

Sequoia Project governance and QHIN management structure

‍

The Sequoia Project serves as the Recognized Coordinating Entity for TEFCA, managing the Common Agreement and vetting QHIN applicants. 

‍

As of 2025, eight organizations completed onboarding as inaugural QHINs: 

‍

• eHealth Exchange
• Epic's Nexus network
• Health Gorilla
• KONZA
• MedAllies 
• CommonWell
• Kno2 
• eClinicalWorks

‍

This governance model adds another layer of complexity. Organizations must work through QHINs rather than connecting directly, which can slow implementation and create additional failure points. 

‍

The Sequoia Project's role as gatekeeper means changes to the framework move deliberately, providing stability but potentially frustrating organizations looking for rapid innovation.

‍

Limited applicability for payer and Medicare Advantage operations

‍

Here's where TEFCA's limitations become particularly clear. The framework currently offers minimal direct support for payer operations, Medicare Advantage (MA) plans, or the complex data exchanges these organizations require daily. No major payer-led networks have joined as QHINs to date, and transactions like claims data sharing or prior authorization remain outside TEFCA's initial focus.

‍

Payers need clinical data, but they also require:

‍

• Claims data
• Eligibility information
• Risk adjustment documentation for HCC coding 
• RAF score management
• STARS quality metrics

‍

These data types don't flow naturally through TEFCA's current architecture. Organizations working with payer data still need separate integration pathways for EDI transactions like 834 benefit enrollment files, 835 claims payments, and 837 procedure submissions.

‍

The American Health Insurance Plans association has cautioned that TEFCA's design may deter payer participation, warning that if QHINs charge fees for exchange, "TEFCA becomes a pay-to-play ecosystem for payers."

‍

Technical scope limitations vs original interoperability promises

‍

When TEFCA was conceived in the 21st Century Cures Act, it was touted as the foundation for universal interoperability across all healthcare stakeholders. The reality proves narrower. TEFCA Version 1 primarily enables exchange of clinical documents via standard query and response, valuable but not complete realization of seamless data liquidity.

‍

Other interoperability needs like real-time FHIR-based data APIs, bulk data transfer for population health, or integration of social and claims data are not yet fulfilled. These capabilities are slated for future phases. Health tech leaders who expected TEFCA to solve most of their interoperability problems are finding they still need multiple integration strategies.

‍

Networks-of-Networks Technical Architecture Challenges

‍

The networks-of-networks concept sounds elegant in theory but introduces substantial technical complexity in practice. TEFCA connects multiple health information exchange networks together, each maintaining its own participating organizations, technical infrastructure, and operational processes. 

‍

This distributed architecture creates: 

‍

• Interconnected failure points
• Data quality concerns
• Governance complications

‍

QHIN connectivity requirements and technical specifications

‍

TEFCA imposes a standard set of protocols on QHINs to ensure interoperability. The QHIN Technical Framework initially centers on IHE-based clinical document exchange (e.g., XCA/XCPD) as a core modality, with additional support for other exchange types such as QHIN Message Delivery and Facilitated FHIR. 

‍

The first QHINs began production TEFCA exchange in late 2023, exchanging clinical documents via these IHE profiles rather than a single mandated document type like CCD.

‍

QHINs are expected to add FHIR API-based exchange capabilities. A significant transition is underway with the January 1, 2026 deadline for QHINs to implement HL7 FAST security protocols for FHIR transactions. This means QHINs will need to upgrade systems to support secure FHIR queries in addition to document-based exchange.

‍

For health IT architects, these requirements mean connecting to TEFCA may involve significant API development and compliance work. Vendor systems must conform to QHIN APIs for patient discovery, record location, and data exchange.

‍

HIE-to-HIE integration complexities and data standardization issues

‍

TEFCA's value proposition is to bridge disparate health information networks, but achieving true interoperability raises tough technical issues. One major challenge is patient identity matching across independent organizations. 

‍

Each HIE has its own master patient index and matching algorithms. When QHINs exchange queries, there's risk of records not linking correctly if patient demographic data is inconsistent.

‍

ONC officials have noted that TEFCA's standardized data formats should improve patient matching over time, but stakeholders caution that federating multiple networks could actually expose more patient matching errors in the near term. 

‍

Beyond matching, data content standardization poses challenges as TEFCA relies heavily on the C-CDA document standard, implemented with varying quality by different EHR systems.

‍

Network scalability challenges in multi-QHIN environments

‍

The networks-of-networks architecture must scale to potentially dozens of QHINs, hundreds of sub-networks, and thousands of participants. To date, TEFCA facilitated the exchange of around 9 million clinical documents nationwide. While that demonstrates significant usage, it's relatively small compared to total health information exchange in the U.S.

‍

As TEFCA participation increases, the broadcast query model could encounter scalability limits. If 20 QHINs are operational, a single provider's query could generate 20 outbound requests across the network. Network latency is another consideration as cross-country queries hop through at least two networks. These orchestration challenges are actively being worked through in QHIN cooperative forums.

‍

Data governance complications across interconnected networks

‍

Connecting networks is not only a technical endeavor but also a governance challenge. Each HIE traditionally has had its own participation agreements, patient consent policies, and privacy rules driven by state laws. Under TEFCA, all participants agree to baseline common governance principles, but variations in state and local regulations still apply.

‍

The GAO has highlighted that variation in state privacy laws remains a barrier even as frameworks like TEFCA try to harmonize exchange policies. Questions arise around data accountability when patient records flow from one network to another via TEFCA. Additionally, some organizations are hesitant because they fear forfeiting revenue opportunities by widely sharing data they once monetized.

‍

Implementation Reality vs Theoretical Framework

‍

The distance between TEFCA's design documents and actual operational deployment tells an important story. What works smoothly in controlled test environments often encounters unexpected friction when confronting the messy reality of healthcare operations.

‍

Current deployment limitations and operational constraints

‍

Although TEFCA is now technically live, its deployment is still limited in scale and capability. The first QHIN-to-QHIN exchanges only began in late 2023 after completion of testing. Many healthcare organizations that plan to participate have not yet gone live with TEFCA exchange. They may be waiting on their vendor to integrate with a QHIN or on their HIE to complete technical upgrades.

‍

An ONC survey found that about 60% of U.S. hospitals planned to participate in TEFCA in 2023, up from 51% in 2022. This is encouraging growth, but it means a sizable share of providers have not yet committed. Until a critical mass of hospitals and clinics are connected through QHINs, the network's utility for any given provider may be modest.

‍

Provider adoption barriers and workflow integration challenges

‍

Experience from past interoperability initiatives shows that unless data exchange is seamless and embedded in clinical software, busy clinicians will not reliably use it. Clinician adoption remains a primary challenge, with industry leaders noting the key is bringing exchange data into workflow and making it actionable.

‍

Even major health systems show adoption lags. Epic aimed to have all its client organizations sign on to TEFCA by the end of 2024, yet by late 2025 many big health systems still had not pledged participation. These holdouts underscore that executives are carefully weighing perceived benefits versus effort. If a health system already exchanges data regionally, they may question what additional advantage TEFCA offers right now.

‍

Technical infrastructure requirements exceeding organizational capabilities

‍

Standing up connectivity to TEFCA can be a heavy lift, particularly for smaller hospitals, physician groups, and local HIEs without large IT budgets. A federal data brief observed that between 2022 and 2023, hospitals with greater resources showed much higher increases in TEFCA participation plans than less-resourced hospitals.

‍

Connecting to a QHIN may require upgrading to the latest EHR version, configuring new API endpoints, implementing FHIR support, and undergoing security testing. Smaller HIE organizations have voiced concern about the costs and personnel needed, with some wary that they cannot afford it without external support. This capability gap could inadvertently widen the digital divide in interoperability.

‍

Cost-benefit analysis revealing limited ROI for many health systems

‍

When health systems conduct rigorous cost-benefit analyses for TEFCA participation, many are finding that the numbers don't work out favorably, at least not in the short to medium term. Implementing TEFCA connectivity has costs including QHIN membership fees, legal and compliance work, and technical build and testing effort.

‍

Many hospitals already exchange data through other means like point-to-point interfaces, state HIEs, and vendor networks, so TEFCA could be seen as duplicative initially. A 2024 industry study found that while a majority of health information organizations intend to join TEFCA, about one-third remain uncertain due to concerns about costs and unclear value proposition. For now, many health tech leaders are performing careful analysis and concluding that the smart move is to pilot and observe rather than invest heavily until TEFCA matures further.

‍

Health Tech Vendor Considerations for TEFCA Integration

‍

Health tech vendors face a distinct set of challenges when evaluating TEFCA integration. Unlike healthcare provider organizations, vendors must build products that work reliably across multiple customer environments, QHINs, and use cases, creating amplified complexity.

‍

API development requirements for QHIN connectivity

‍

Health tech vendors building solutions that integrate with TEFCA face substantial API development requirements going beyond basic FHIR support. 

‍

They must implement:

‍

• Specific profiles
• Extensions
• Search parameters defined in TEFCA's technical framework
• Build robust query routing logic across multiple QHINs
• Implement sophisticated patient matching algorithms 
• Develop comprehensive error handling for various failure modes possible in a distributed network

‍

Finding developers who understand both FHIR implementation details and healthcare data exchange workflows isn't easy, and building the necessary capabilities can take months or even years depending on solution complexity.

‍

FHIR implementation complexities in TEFCA environments

‍

As TEFCA evolves to support FHIR-based data exchange, vendors encounter a new layer of complexity. By January 2026, TEFCA QHINs and participants are expected to have FAST security protocols in place for FHIR exchanges, requiring vendors to build support for UDAP JWT-based client authentication, dynamic registration, and fine-grained OAuth scopes.

‍

Version management becomes a challenge when different QHINs or participating organizations operate on different FHIR versions. Solutions might need to support multiple FHIR versions simultaneously or provide translation capabilities between versions, increasing code complexity and testing burden substantially.

‍

Vendor certification processes and compliance requirements

‍

Operating in the TEFCA ecosystem means meeting a range of compliance criteria. QHINs must undergo rigorous testing and attestation. When eHealth Exchange became a QHIN, its team spent countless hours ensuring they met security, performance, and interoperability guidelines.

‍

The RCE is developing a TEFCA Participant certification program so organizations and their IT systems can be validated as compliant. For EHR and HIE vendors, this likely means undergoing additional testing regimes similar to ONC certification for meaningful use. The certification process isn't a one-time event, as TEFCA's specifications evolve and QHINs update their requirements.

‍

Technical support burden for multi-network connectivity

‍

During the transition period to nationwide TEFCA adoption, most healthcare organizations will participate in multiple interoperability networks simultaneously. For vendors, this creates a support burden as their clients might be using traditional HIE interfaces, national networks like Carequality, and TEFCA via a QHIN all at once.

‍

Rather than simplifying the environment in the short term, TEFCA can actually add another integration point to manage. Vendors have to ensure routing logic and data flows don't conflict or overwhelm clinicians. Technical support teams will require new skills and playbooks to handle TEFCA-related issues, including understanding the Common Agreement's operational rules.

‍

Strategic Alternatives to TEFCA for Health Tech Leaders

‍

TEFCA isn't the only path to healthcare interoperability, and for many organizations it isn't even the best path. The healthcare data exchange landscape includes multiple proven approaches that deliver reliable results for specific use cases.

‍

Direct HIE partnerships vs TEFCA network participation

‍

Many health tech leaders are finding that direct partnerships with regional HIEs deliver better results than TEFCA participation, at least for their specific needs. Regional and state HIEs often provide tailored services like real-time hospital event notifications, data normalization, and local public health reporting.

‍

Regional HIEs often push critical data directly into physician EHR inboxes, whereas TEFCA relies on clinicians actively querying for information. Additionally, HIEs commonly perform data quality checks and merge records from different sources, delivering a more coherent patient history. The trade-off is that direct partnerships don't scale nationally as easily as TEFCA theoretically does.

‍

Point-to-point integration strategies for critical data exchanges

‍

For mission-critical data exchanges where reliability and performance are paramount, point-to-point integrations often outperform network-based approaches. Health systems have long employed custom interfaces like direct HL7 feeds of ADT messages to notify partners when shared patients are discharged.

‍

Organizations using EHR systems like Epic or Cerner often find that leveraging these platforms' built-in integration capabilities delivers better results than routing through TEFCA. Epic's Care Everywhere network, for example, already connects thousands of healthcare organizations and has been refined through years of operational experience.

‍

Cloud-based interoperability solutions as TEFCA alternatives

‍

Cloud-based interoperability platforms are emerging as practical alternatives to TEFCA for many use cases. Solutions from vendors like Redox, Health Gorilla, and others provide pre-built connectors to multiple data sources along with data normalization and transformation capabilities.

‍

These platforms handle much of the complexity that makes TEFCA implementations challenging, offering standardized APIs for accessing diverse data sources and managed infrastructure that scales. Cloud platforms also evolve faster than standards-based frameworks like TEFCA.

‍

Regional health information networks and their competitive advantages

‍

Regional HIEs often maintain competitive advantages including established relationships with local providers and payers, comprehensive coverage of healthcare activity within their geographic area, and flexibility to support region-specific programs that TEFCA's national framework can't easily accommodate.

‍

Some regional networks are evolving into Health Data Utilities, providing analytics, quality reporting, and other services on top of exchanged data. These value-added offerings give them a leg up in demonstrating ROI to participant hospitals, something TEFCA does not attempt to do.

‍

Future Outlook and Strategic Planning for TEFCA Evolution

‍

TEFCA's future trajectory remains uncertain in important ways that affect strategic planning for health tech leaders. The framework will continue evolving, but the direction, pace, and scope depend on factors including regulatory mandates and market adoption rates.

‍

Potential expansion to payer integration and timeline uncertainties

‍

A major development on the horizon is the inclusion of payers and payer-provider exchange use cases. The HL7 Da Vinci Project's Trebuchet pilot launched in 2024 to demonstrate prior authorization and clinical data exchanges between providers and payers via a QHIN, using eHealth Exchange as the intermediary.

‍

In mid-2025, ONC announced a TEFCA 10x10 Payer/Provider Coalition to get 10 payers and 10 providers working together on TEFCA use cases, indicating a policy push to accelerate payer connectivity. However, timeline uncertainties remain, with some suggesting robust payer integration won't be live until 2026-2027. Health tech leaders serving the payer market shouldn't wait for TEFCA to expand and should plan integration strategies based on what TEFCA can do today.

‍

CMS policy development following TEFCA implementation patterns

‍

The evolution of TEFCA is happening in parallel with federal policies from CMS and other agencies. ONC's HTI-1 final rule in 2024 created a TEFCA exception to information blocking, giving providers and networks a safe harbor if they use TEFCA to fulfill data requests.

‍

This is a strong hint that the government sees TEFCA as the preferred backbone for nationwide exchange and is beginning to weave it into the regulatory fabric. We anticipate that CMS may tie certain incentives or requirements to TEFCA in coming years, such as credit in MIPS or value-based care programs for using TEFCA for care coordination.

‍

Technology infrastructure investment timing considerations

‍

One of the trickiest strategic decisions for CIOs and CTOs is when to invest in the necessary infrastructure for TEFCA. TEFCA standards are still evolving. In mid-2024, the RCE released drafts of Common Agreement Version 2 and updated QHIN technical specs to expand use cases, indicating that the rules of the road may change.

‍

Infrastructure decisions should account for the possibility that TEFCA becomes more important over time. Building systems with sufficient flexibility to add TEFCA connectivity later provides optionality without requiring premature investment. Consider piloting TEFCA connectivity for specific use cases rather than making an all-in commitment.

‍

Risk assessment for early adoption vs wait-and-see strategies

‍

Adopting any new national framework comes with risks and rewards. Early TEFCA adopters gain a seat at the table, can influence TEFCA's development, and brand themselves as interoperability leaders. However, they take on the risk of dealing with immature technology and potential network instability.

‍

Wait-and-see adopters avoid initial pitfalls and conserve resources, but they risk falling behind or missing out on shaping direction. The optimal approach often involves selective early adoption, participating enough to understand TEFCA's realities and maintain readiness for broader adoption if the framework proves valuable or becomes mandatory.

‍

Decision Framework for TEFCA Investment and Implementation

‍

Making sound TEFCA investment decisions requires structured analysis rather than reactive responses to competitive pressures or technology hype. The framework presented here provides structured questions and analysis approaches that help leaders think clearly about complex trade-offs.

‍

Current state assessment of interoperability needs and capabilities

‍

The first step is for an organization to honestly assess what its interoperability pain points and goals are. Health tech leaders should inventory their existing data exchange methods and identify where gaps exist that impact care or operations.

‍

Data shows hospitals that already participate in national or regional networks are far more likely to plan on TEFCA, with 75% participation intent among hospitals in national networks versus only 39% of those not in any network. 

‍

This implies that being well-integrated today correlates with readiness for TEFCA. If an organization is not in that camp, the assessment might reveal the need to shore up fundamental interoperability practices as stepping stones before TEFCA will be truly usable.

‍

Cost-benefit analysis for TEFCA participation vs alternatives

‍

Organizations should conduct thorough cost-benefit analysis comparing TEFCA participation to other ways of meeting their interoperability needs. 

‍

On the cost side, consider direct and indirect costs including: 

‍

• QHIN participation fees
• Implementation costs
• Ongoing maintenance
• Opportunity costs from resource diversion

‍

Compare TEFCA economics to alternative approaches. What would direct HIE partnerships cost? How do point-to-point integrations for critical exchanges compare? Often the alternatives deliver comparable or better value at lower cost and risk, at least for specific use cases. This analysis should be revisited periodically, because costs and benefits will shift as TEFCA scales.

‍

Technical readiness evaluation and infrastructure gap analysis

‍

In parallel with cost-benefit, a technical readiness evaluation should pinpoint infrastructure gaps that need addressing. 

‍

Key items include: 

‍

• Standards support
• Patient identity matching capabilities
• Required transport protocols and security
• High-availability environment appropriate for 24/7 exchange

‍

Identifying these gaps will shape whether additional software or module purchases are needed. Organizations that find the list extensive may opt to delay joining until they tackle key prerequisites, so that their TEFCA participation will be successful when it happens.

‍

Strategic timing recommendations for TEFCA engagement decisions

‍

After gathering the above inputs, leadership can formulate a strategy on when and how to engage with TEFCA. 

‍

Several scenario-based recommendations often emerge such as: 

‍

• Early adopter strategy for those showing strong current benefits
• Phased adoption strategy allowing time to adjust and minimize disruption
• Delayed adoption with monitoring of key indicators that would trigger revisiting the decision

‍

Many will choose to engage in TEFCA through intermediaries or coalitions rather than alone. A small health center might participate via their state HIE who is a QHIN participant, effectively outsourcing much of the heavy lifting. This can lower cost and risk while ensuring connectivity when it becomes more valuable.

‍

Final Takeaways

‍

TEFCA represents an important development in healthcare interoperability, but health tech leaders must approach it with clear-eyed realism. The framework's current provider-centric focus, technical complexities, and limited applicability for payer operations mean it's not the universal solution many hoped for.

‍

The gap between TEFCA's theoretical promise and operational reality shouldn't discourage attention. Rather, it should inform more strategic thinking about when and how to engage. For organizations with specific provider interoperability needs in TEFCA's sweet spot, participation may deliver genuine value. For others, alternative approaches like direct HIE partnerships or point-to-point integrations might prove more practical.

‍

The framework will continue evolving, and future policy developments could make TEFCA participation more important or even mandatory for certain healthcare organizations. Smart health tech leaders maintain awareness of these developments while building flexible architectures that can adapt when circumstances change. Ultimately, successful interoperability strategies require matching tools to needs rather than adopting frameworks because they're new or heavily promoted.

‍

Frequently Asked Questions

‍

What is TEFCA and how does it differ from existing HIE networks?

‍

TEFCA is a framework designed to create nationwide interoperability by connecting existing health information exchange networks into a networks-of-networks model. Unlike traditional HIEs that operate independently within specific regions, TEFCA establishes common technical and governance standards that allow different networks to communicate through Qualified Health Information Networks. However, TEFCA doesn't replace existing HIEs but rather provides a framework for them to interconnect.

‍

Is TEFCA participation currently mandatory for healthcare organizations?

‍

No, TEFCA participation is currently voluntary for most healthcare organizations. There are no federal regulations requiring providers or health systems to join QHINs or participate in the TEFCA network. However, this could change as CMS and other regulators develop future interoperability policies. Organizations should monitor regulatory developments closely, as what's voluntary today may become mandatory through future rulemaking.

‍

Can TEFCA support payer operations and MA data needs?

‍

Currently, TEFCA has limited applicability for payer operations and MA programs. The framework focuses primarily on provider-to-provider clinical data exchange and doesn't adequately support claims processing, eligibility verification, risk adjustment documentation for HCC coding, RAF score management, or STARS quality measure reporting that payers require. Organizations operating in the payer space still need separate integration strategies for EDI transactions that TEFCA doesn't address.

‍

What are the typical costs associated with implementing TEFCA connectivity?

‍

TEFCA implementation costs vary widely depending on organizational size, technical readiness, and scope of participation. Expenses include API development for FHIR and QHIN connectivity, infrastructure upgrades to meet security and performance requirements, staff training and change management programs, and ongoing operational costs. Small organizations might spend hundreds of thousands of dollars, while large health systems could invest millions in comprehensive implementations.

‍

Should health tech vendors prioritize TEFCA integration in their product roadmaps?

‍

The answer depends on your target market and customer needs. Vendors serving provider organizations in markets where TEFCA adoption is accelerating should consider prioritizing TEFCA capabilities. Those focused on payer markets or regions where TEFCA adoption is limited might find that alternative integration approaches deliver more customer value. Most vendors benefit from a phased approach with limited initial TEFCA investment to maintain readiness while focusing primary development resources on integrations that customers actively demand today.

‍

‍