Financial Incentives for Health Information Technology
The stimulus package provided $17.2 billion for a program of financial incentives for eligible Medicare and Medicaid providers (professionals and hospitals) that make “meaningful use” of “certified” electronic health records (EHRs) in the next few years. (In May 2009 the federal Centers for Medicare and Medicaid Services estimated that the cost of this program might eventually rise to $48.8 billion.)
The stimulus act provides three broad criteria for demonstrating that a professional or institution is a “meaningful EHR user.” They are:
- Meaningful use of certified EHR technology
- Information exchange
- Reporting on measures using EHR
However, the specific definitions of “meaningful use” and “certified” are being crafted by the Office of the National Coordinator for Health Information Technology (ONC) and are expected in late 2009. The ONC, part of the Department of Health and Human Services (HHS), also must ensure that standards are uniform so that information can be shared by different information technology systems.
The timetable is tight, as the financial incentives will start flowing in fiscal 2011.
On the Medicare side, healthcare providers who meet the ONC’s criteria for meaningful use of certified EHRs and other health-related information technology could receive as much as $48,400 (for a medical professional) or up to about $11 million (for a large hospital). Payments to hospitals will begin in October 2010 and phase out after four years. Incentive payments to eligible professionals begin in January 2011 and phase out by 2016. EHR systems adopted after 2015 do not qualify for incentives, and providers who aren’t using approved EHRs by 2015 face financial penalties.
On the Medicaid side, states will oversee reimbursements to eligible providers who purchase computers and software to use and share EHRs. Since Medicaid is administered and partly funded by the states, the criteria for participation could vary from state to state. More information is expected soon, as incentive payments are to begin in 2011. The maximum amount will be about $64,000, payable over six years. There is no penalty clause on the Medicaid side, however. (Providers will not be able to seek reimbursement from both the Medicare and Medicaid programs.)
The ONC and others are still working on the requirements that will guide the incentives program, including whether health professionals other than physicians may qualify. HHS will publish an initial set of standards, specifics on implementation and certification criteria by Dec. 31, 2009. More information will follow in 2010, when the ONC plans an extensive national outreach and education program for medical providers and state Medicaid agencies.
Click here for an overview of this program.
Click here for further details of the legislation.
Click here for more government resources related to the health information technology initiative.