Meaningful Use

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General Stimulus Information

Like many others in the healthcare industry, you have probably heard by now that the government is offering a chunk of money to healthcare providers to implement Electronic Health Records (EHR). The HITECH provisions of the American Recovery and Reinvestment Act of 2009 (ARRA) provide billions of dollars in incentives for the adoption and use of Health Information Technology (HIT) by Medicare and Medicaid providers over the next ten years. This site is dedicated to providing the latest news, information, and educational materials regarding the incentives. It also contains extensive resources for research, downloadable tools, and professional advice.


The first step in understanding the EHR incentive program is to differentiate between what the government is and isn’t offering. First, it is important to know that eligible providers and facilities do NOT qualify for funds by simply purchasing an EHR. Instead, you have to show that the EHR is being used in a “meaningful" way. Furthermore, the feds aren’t providing any money up front. Participants must purchase or lease a system in advance. Then, starting in 2011, Medicare or Medicaid will begin providing additional reimbursements if you can demonstrate “meaningful" use of a qualified EHR. 
On December 30, 2009 the Centers for Medicare and Medicaid Services (CMS) released an advanced copy of a Notice of Proposed Rulemaking (NPRM) defining the requirements for meaningful use. These guidelines outline the measures and the details of how eligible providers and hospitals will be paid incentive dollars. The meaningful use requirements are grouped into three categories, and must be implemented in stages in order to qualify for funding.
Stage 1 - The focus is on capturing electronic data.
Stage 2 - Reporting Health Information & Tracking Key Clinical Conditions
Stage 3 - Improving Performance & Health Outcomes
Here’s how the incentive program works: Non-hospital-based physicians who participate in Medicare or derive 30 percent or more of their business from Medicaid (20 percent for pediatricians) are eligible to receive subsidies. The maximum amounts for which you may be eligible range from Medicare payments of $44,000 to nearly $64,000 from Medicaid over a five-year period. You can apply for either of these programs, but not both, and physicians practicing in underserved areas are eligible for an extra 10 percent from Medicare. Hospitals who qualify can participate in the Medicare and/or Medicaid program, and are paid based upon a pre-defined formula as described in later segments. Under the Medicare provisions, beginning in 2011, you can receive $18,000 in reimbursements that year, followed by annual payments of $12,000, $8,000, $4,000, and $2,000. Those who apply in 2013 receive $15,000 in the initial year, followed by three years of diminishing payments. The first-year payment in 2014 is $12,000, with lower incentives the following two years. No incentives are available to anyone who applies after that, and no payouts will occur after 2016. Hospitals are eligible for up to four years of incentives, and can receive funds all the way up to 2018.
Physicians who are not using qualified EHRs meaningfully by 2015 will lose 1 percent of their Medicare reimbursement; in 2016, they will forfeit 2 percent, and in 2017 and each year thereafter, 3 percent. If less than 75 percent of physicians have met the EHR requirements by 2018, the Secretary of Health and Human Services is empowered to cut Medicare payments to the laggards by up to 5 percent. Hospitals have until 2016 to comply, but are strongly urged to complete Stage 3 requirements by 2015.
The subsidy program is destined to have a huge impact on EHR sales to physicians. In the next six to nine months it is predicted that, between 50,000 and 100,000 physicians will acquire EHRs in preparation for the 2011 subsidies. In fact, there is reasonable concern amongst some experts that software vendors will not be able to handle all the business. Some tout that there are simply not enough trained technicians on the ground to handle the pending frenzy. 
As the surge of EHR implementations begin to reach critical mass, vendors may be forced to selectively choose how their resources will be allocated. With a huge shortage of experienced technicians expected, practices who wait too long to implement EHR solutions will likely find it more and more difficult to implement practical solutions in time to participate in the rollout of the government subsidies in time to meet the staged deadlines. Organizations are urged to begin making preparations as soon as possible to ensure that there will be plenty of time and resources available to establish practical EHR solutions within the times allotted.