On Feb. 17, 2009, President Obama signed the American Recovery and Reinvestment Act of 2009, a critical measure to stimulate the economy. Among other provisions, the law provides major opportunities for the Department of Health and Human Services, its partner agencies, and the States to improve the nation’s health care through Health Information Technology by promoting the meaningful use of electronic health records (EHR) via incentives (EHR Stimulus).
Funding for the EHR Stimulus is available to certain eligible professionals and hospitals. Funds will be distributed through Medicare and Medicaid incentive payments to EPs, physicians, and hospitals who are “meaningful EHR users.” In addition, with regard to the Medicaid program, federal matching funds are also available to States to support their administrative costs associated with these provisions.
Criteria for Qualifying for an Incentive
Meaningful EHR users demonstrates each of the following: meaningful use of a certified EHR, the electronic exchange of health information to improve the quality of health care, and reporting on clinical quality and other measures using certified EHR technology. Medicaid programs determine their own requirements in line with the Medicaid-related provisions of the Recovery Act. Funds for the EHR Stimulus are distributed through Medicare and Medicaid incentive payments to EPs and hospitals who are “meaningful EHR users.”
Medicare Payment Incentives for Eligible Professionals
The Recovery Act establishes financial incentives for eligible professionals (EPs) who are meaningful EHR users. Payment adjustments are imposed on EPs who are not meaningful EHR users. Hospital-based physicians who substantially furnish their services in a hospital setting are not eligible.
The EHR Stimulus incentive payment is equal to 75 percent of Medicare allowable charges for covered services furnished by the EP in a year, subject to a maximum payment in the first, second, third, fourth, and fifth years of $15,000; $12,000; $8,000; $4000; and $2,000, respectively. For early adopters whose first payment year is 2011, the maximum payment is $18,000 in the first year. There will be no payments for meaningful EHR use after 2016. There would be no payments to EPs who first become meaningful EHR users in 2015 or thereafter. For EPs who predominantly furnish services in a health professional shortage area (HPSA), incentive payments would be increased by 10 percent.
The Medicare fee schedule amount for professional services provided by an EP who was not a meaningful EHR user for the year would be reduced by 1 percent in 2015, by 2 percent in 2016, by 3 percent for 2017 and by between 3 to 5 percent in subsequent years. For 2018 and thereafter, if the Secretary finds that the proportion of EPs who are meaningful EHR users is less than 75 percent, then the reductions will be increased by 1 percentage point each year, but by not more than 5 percent overall.
The Recovery Act establishes 100 percent Federal Financial Participation (FFP) for States to provide EHR Stimulus incentive payments to eligible Medicaid providers to purchase, implement, and operate (including support services and training for staff) certified EHR technology. It also establishes 90 percent FFP for State administrative expenses related to carrying out this provision.
Incentive Payments to Providers
Certain Medicaid professionals and hospitals are eligible for EHR Stimulus incentive payments. Eligible professionals include physicians, dentists, certified nurse-midwives, nurse practitioners, and physician assistants who are practicing in Federally Qualified Health Centers (FQHCs) or Rural Health Clinics (RHCs) led by a physician assistant.
Eligible professionals must meet minimum Medicaid patient volume percentages, and must waive rights to duplicative Medicare EHR Stimulus incentive payments. Eligible professionals may receive up to 85 percent of the net average allowable costs for certified EHR technology, including support and training (determined on the basis of studies that the Secretary will undertake), up to a maximum level, and incentive payments are available for no more than a 6-year period.
EHR Stimulus payments are available for acute care hospitals with at least 10 percent Medicaid patient volume and for children’s hospitals of any patient volume. Entities that promote EHR technology certification, as designed by the state, are also eligible to receive incentives through arrangements with eligible professions.
Medicaid Incentive Program Qualifications
To be eligible for EHR incentive payments out of the initial technology adoption and upgrades, providers must demonstrate “meaningful EHR use” as designed by the State. In determining meaningful use, a State ensures that population with unique needs – such as children – are addressed. A State might require providers to report clinical quality measures as part of the meaningful use demonstration. EHR technology must also be compatible with State or Federal administrative management services. EPs can not receive an EHR Stimulus incentives under both Medicare and Medicaid in a given year.
Helpful EHR Stimulus Links
CMS EHR Certification ID