On December 30, the U.S. Department of Health and Human Services (HHS) released the long-awaited proposed rule establishing the Electronic Health Record (EHR) Incentive Program, which lays out a set of standards, implementation specifications, and certification criteria for EHR technology. This program has been developed in response to the “American Recovery and Reinvestment Act” (ARRA), which authorizes the Centers for Medicare & Medicaid Services to provide a reimbursement incentive for physician and hospital providers who become “meaningful users” of an EHR.
Through this program, the government is working toward two primary goals: incentivizing physicians and hospitals that have been slow to adopt EHRs and facilitating active exchange of patient data between nonaffiliated providers to ensure informed and nonduplicative care. Most of the funds are designated for direct payments that reward physicians and hospitals for adopting and using robust, connected EHR systems.
One incentive program targets providers who see large volumes of Medicaid patients and another focuses on physicians seeing Medicare patients.
Medicaid and Medicare
Physicians who have a patient mix that includes at least 30% Medicaid patients (20% for pediatricians) are eligible for incentive payments of up to $64,000 over five years. The incentives are calculated through a formula that factors in the Medicaid mix seen by the provider as well as EHR adoption incentives ranging from $25,000 in the first year to $10,000 in subsequent years.
Medicaid incentive payments will be determined by the same calculation as the Medicare algorithm—weighted for the first four years, based on the Medicaid patient load. No reductions in Medicaid payments will be made if a provider does not adopt certified EHR technology, although incentives are available only through 2021, and providers must start receiving payments by 2016.
Physicians who accept Medicare patients can receive up to $44,000 over the five years. These incentive payments begin in 2011 and gradually phase down. Starting in 2015, providers are expected to have adopted and be actively utilizing an EHR in compliance with the “meaningful use” definition, or they will be subject to financial penalties under Medicare. Medicare incentive payments are capped at 75% of allowable Medicare charges—up to $18,000 for the first payment year. Incentive payments are reduced in subsequent years: $15,000, $12,000, $8,000, $4,000, and $2,000.
What does 75% of allowable Medicare charges really mean? A provider’s office that has allowable Medicare charges totaling $24,000 or more can receive the full $18,000 in ARRA stimulus money. A provider with $13,300 in allowable Medicare charges is eligible for only $9,975 in ARRA stimulus money. For eligible professionals in rural health professional shortage areas, the incentive payment amounts are increased by 10%.
It is important to note that the HHS secretary may exempt hospitals and providers from penalties on a case-by-case basis for hardship situations. Providers may not receive multiple incentives. Those who qualify for both Medicare and Medicaid incentives must choose to pursue benefits through only one program.
What Should My Practice Do?
Should we purchase and install an EHR system now or wait until the final rule is published? Should we look into system upgrades or a new system? These are common questions rheumatology practices are asking.
The ACR’s Senior Specialist of Registries and Healthcare Informatics, Itara Barnes, suggests that rheumatology practices not wait due to uncertainty surrounding the final rule. “Begin the EHR evaluation and selection process now,” she advises. “Final and complete clarity on meaningful use and certification relating to incentive payments is not expected until the spring of 2010, leaving minimal time to select and implement an EHR system to achieve meaningful use by 2011. In addition, the EHR industry is likely to experience a drastic increase in demand the closer we get to 2011 and may be strapped for resources.”
Barnes suggests that practices start now by developing a plan for selection and implementation. Begin looking at fully functional EHR systems and hosted solutions that are currently Certification Commission for Health Information Technology certified. Remember that the new certification will only address the bare minimum needed to support “meaningful use,” while your practice will demand much more from the system. It is also important to ensure that the EHR system supports defined interoperability goals for 2011 including lab results delivery, e-prescribing, claims and eligibility checking, and quality reporting.
Correction
In the article, “A Preceptorship Comes Full Circle,”(December 2009, p. 12), it was mistakenly reported that Elizabeth Perkins, MD, had qualified for the University of California, San Francisco fellowship program, when in fact it was Franziska Matzkies, MD. Although Dr. Perkins was one of the first preceptees of the Ephraim P. Engleman Resident Research Preceptorship, she is now in private practice in Birmingham, Ala.
What Is the ACR Doing?
In February, the ACR’s Health Information Technology Committee began reviewing the rule to identify both financial opportunities and potential penalties for rheumatology practices and hospitals and is in the process of submitting comment on the interim final rule in conjunction with the Government Affairs Committee. There are several items in the rule that need further clarification, and the committee will continue to work through all available avenues to promote a final rule that is practical and that can actually be achieved.
Once the rules are finalized, the ACR will offer detailed educational materials and host webinar sessions on how the rules will affect rheumatology.
For more information about this and other health information technology topics, contact Itara Barnes at [email protected].