The American Recovery and Reinvestment Act of 2009 (ARRA) is trying to get all healthcare providers to convert to using an EHR (Electronic Health Record) system by 2015. These systems can also be known as EMR (Electronic Medical Records).
ARRA is set to provide $19 billion to encourage physicians to use EHRs (Electronic Health Records). The incentive reimbursements would be paid out over five years to practices that purchase EHRs and use them in a “meaningful” way. To qualify for an incentive reimbursement, the Electronic Health Records system must be able to "talk" to systems from other vendors, and it must have advanced features such as clinical decision support. You also must demonstrate that you're a meaningful user of the technology — that is, you electronically prescribe, exchange data with other providers, and generate reports on how you perform on as yet unspecified "clinical quality measures." Such measures may resemble those in Medicare's Physician Quality Reporting Initiative (PQRI), such as the percentage of patients with diabetes who receive a yearly eye examination.
Finally, your Electronic Health Records (EHRs) must also be certified. ARRA does not specify who will supply this certification or “stamp of approval”, but the federal government will likely choose the Certification Commission on Healthcare Information Technology (CCHIT). If you are looking at purchasing an EHR system also known as EMR (Electronic Medical Records) and would like to receive incentive reimbursements, you should consider not only buying CCHIT certified programs, but also contractually requiring vendors to meet all the standards that emerge as the law gets finalized. According to federal government publications, officially approved Electronic Health Records (EHR) systems or Electronic Medical Records system will not be finalized and revealed until December 2009.
ARRA tries to lower the price barrier. You could receive up to $44,000 over 5 years under the Medicare program if you meet complicated qualifications for Electronic Health Records (EHR) use. But to receive the maximum $44,000, you must qualify as an EHR user beginning in either 2011 or 2012. Waiting until 2013 or 2014 reduces your bonus period, and all payments cease after 2016. If you wait to first qualify in 2015, you receive nothing. The payments will be dispersed over a five-year period starting in 2011 and ending in 2016 for the physicians that qualify. Any physician (including a dentist) participating in Medicare is eligible to receive Medicare incentive payments for being a “meaningful EHR user,” except physicians who furnish substantially all of their services in inpatient or outpatient hospital settings. Consequently, emergency physicians, anesthesiologists, radiologists, pathologists and other hospital-based physicians are not eligible for the Medicare incentive payments for EHR use. (See Attached Graph)
The professionals eligible to receive Medicaid EHR (Electronic Health Records) incentive payments are physicians, dentists, nurse-midwives, nurse practitioners, and some physician assistants, as long as they are not hospital-based like emergency physicians, anesthesiologists, radiologists and pathologists. To be eligible for Medicaid EHR incentive payments, a professional must devote the applicable percentage of his or her practice to serving Medicaid patients (e.g., 30% for an internist or 20% for a pediatrician).
Medicaid-eligible professionals may receive from State Medicaid agencies up to $21,250 in federal dollars for the purchase of EHR technology. They may also receive from State Medicaid agencies up to $8,500 in federal dollars annually, for five years, for the operation, maintenance and use of their EHR technology. Their maximum Medicaid EHR incentive payment in federal dollars is, thus, $63,750. DHHS may reduce the maximum of federally funded EHR incentive payments for Medicaid-eligible professionals if DHHS determines that the average cost for purchasing and maintaining EHR technology is less than $63,750.
Professionals accepting Medicaid EHR incentive payments are not eligible to receive Medicare EHR incentive payments. Medicaid-eligible professionals must pay at least 15% of the cost to purchase and maintain their EHR technology (i.e., State Medicaid agencies may pay no more than 85% of the professional’s cost to purchase and maintain the EHR technology). Federal funds may not be used for Medicaid incentive payments for the purchase of EHR technology after 2016 or for the maintenance of EHRs after 2021.
Something to also take in to consideration is what obligations and possible liabilities that you will be subjecting yourself to by accepting government incentive payments. Nothing has been finalized or published yet regarding your requirements back to the government in turn for receiving incentive payments, but there have been several discussions going on. You will definitely have an increased liability for the protection of your patient’s personal healthcare HIPAA protected information. Several companies that received money in the 2008 Economic Stimulus Package, soon found out that by accepting the money, they made themselves almost forever contracted with the government, and lost control on several measures of their company.
Practices that decline to use EHRs will be penalized in the form of a 1 percent reduction in their Medicare fee schedule in 2015, 2 percent in 2016, and 3 percent in 2017 and every year thereafter. If EHR adoption fails to hit the 75% mark by 2018, the Department of Health and Human Services (HHS) can boost the penalty to 4% that year and a maximum 5% in 2019 and beyond. (See Attached Graph)
The legislation requires HHS, through the Office of the National Coordinator of Health Information Technology, to adopt initial criteria for deciding which practices will be eligible to receive the funds--including questions such as what types of systems will qualify and what constitutes meaningful use--by December 31, 2009.
Many physicians at this point are either declining the use of EHR systems or declining the acceptance of incentive payments to cover their costs. Many physicians feel that this is the governments attempt to control how healthcare is administered and push towards nationalized healthcare.
Physician Incentive Payments. Beginning 2011, Medicare will pay a physician (or the physician’s group practice) annual incentives for being a “meaningful EHR user” up to the following amounts:
|
Year Physician Is Meaningful EHR User |
Calendar Year |
Maximum Medicare Incentive Payment |
|
If 1st year of meaningful EHR use is: |
2011 or 2012 |
$18,000 |
|
2013 |
$15,000 |
|
|
2014 |
$12,000 |
|
|
2015 or after |
$0 |
|
|
If 2nd year of meaningful EHR use is: |
2012, 2013 or 2014 |
$12,000 |
|
2015 |
$8,000 |
|
|
2016 or after |
$0 |
|
|
If 3rd year of meaningful EHR use is: |
2013, 2014 or 2015 |
$8,000 |
|
2016 |
$4,000 |
|
|
2017 or after |
$0 |
|
|
If 4th year of meaningful EHR use is: |
2014, 2015 or 2016 |
$4,000 |
|
2017 or after |
$0 |
|
|
If 5th year of meaningful EHR use is: |
2015 or 2016 |
$2,000 |
|
2017 or after |
$0 |
Physician Payment Reductions for Non-EHR Use. DHHS will decrease Medicare Part B payments to physicians who were eligible to be, but failed to become, “meaningful EHR users” by 2015. The reductions will be as follows:
|
Calendar Year |
Reduction in Medicare Part B Payments |
|
2015 |
1% if physician is e-prescriber |
|
2% if physician is not e-prescriber |
|
|
2016 |
2% |
|
2017 and after |
3% |
After 2017, DHHS may decrease Medicare Part B payments an additional 1% for each year in which less than 75% of the physicians eligible to be “meaningful EHR users” are using EHRs. The maximum Medicare Part B payment decrease is 5%. DHHS may exempt from the Medicare Part B payment reductions a physician for whom becoming a “meaningful EHR user” would be a “significant hardship.” An exemption must end after five years.