What $34B Taught Us About Digital Health—and What We Still Haven’t Learned

In 2009, Congress passed the HITECH Act as part of a broader economic stimulus package. The goal was ambitious: modernize America’s healthcare system by incentivizing electronic health record (EHR) adoption. The price tag? $34 billion.

More than a decade later, most providers have adopted EHRs. But the outcomes we hoped for—true interoperability, streamlined care, reduced administrative burden—are still elusive. Why?

To unpack this, I sat down with Jodi Daniel, the former Director of Policy at the Office of the National Coordinator for Health IT (ONC). Jodi helped write the HIPAA privacy rule, led development of Meaningful Use regulations, and coined the term information blocking, now part of federal law.

Her reflections offer both a historical map and a warning: technology doesn’t solve systemic problems. Policy, incentives, and leadership do.

We Digitized Records, But Not the System

According to Jodi, the adoption of EHRs solved the surface problem—paper records—but didn’t address the underlying structures that prevent data from flowing across systems.

“We still didn’t have interoperability. The data still was not flowing,” Jodi told me. “What we have is a business problem.”

The systems are technically capable. The standards exist. But hospitals and vendors are not incentivized—or are actively disincentivized—to share data. In many cases, keeping patient information siloed is treated as a competitive advantage.

The Resistance to Patient Access Was Real

Today, patient access to health data is a core principle in both policy and product design. But Jodi reminded me that wasn’t always the case. When HIPAA was first introduced, there was open resistance from providers who saw medical records as theirs.

“I literally had doctors in the audience yelling at me,” she said. “They believed the record belonged to them—not the patient.”

Including patient rights in HIPAA wasn’t a technical achievement. It was a values-driven policy decision. It took courage and persistence—and set the stage for the patient empowerment movements we see today.

Fast Policy Can Be Risky Policy

One of the most revealing parts of our conversation was the timeline under which Meaningful Use regulations were written. After HITECH passed, Jodi and her team had nine months to create a full regulatory framework for what EHRs must include.

Nine months is fast for any regulation. For a first-of-its-kind national framework with billions of dollars at stake, it was nearly unprecedented.

“That timeline shaped everything,” she said. “It defined who could compete, what functionality got prioritized, and what trade-offs had to be made.”

In that rush, incumbent vendors had a clear advantage—and new entrants struggled to keep up. Innovation was not evenly distributed.

Policy as a Forcing Function

One of the most compelling stories Jodi shared was about patient-generated health data (PGHD). At the time, many argued that standards didn’t exist, and providers wouldn’t be able to incorporate this data meaningfully.

Jodi disagreed. She knew that without policy pressure, those standards would never materialize.

“Sometimes you have to lead with policy,” she said. “Not because the ecosystem is ready, but because the ecosystem won’t move unless you do.”

That principle—regulation as a tool for catalyzing innovation—is especially relevant now, as we navigate the rise of generative AI and algorithmic decision-making in care.

What Comes Next

We closed our conversation by looking ahead. The next frontier isn’t just digital—it’s intelligent, interconnected, and risk-aware. But if we don't address the same core issues—misaligned incentives, policy fragmentation, lack of patient-centered design—AI will follow the same path as EHRs: high promise, uneven impact.

Jodi’s call to action was clear: policymaking must remain grounded in real-world use, in clinician workflows, and most importantly, in patient outcomes. We need regulators who understand innovation—and innovators who respect the guardrails.

Listen to the Full Episode

Listen to the full conversation with Jodi Daniel on Inside MedTech Innovation: https://open.spotify.com/show/0idCTXcel0SvjHLalRoxIl?si=bed31e6a426d4fc0