The American Recovery and Reinvestment Act (ARRA), signed into law by President Obama in February, 2009, contains a provision known as the HITECH Act, appropriating funding to encourage adoption and meaningful use of Electronic Medical Records (EMR) and technology for information exchange among the nation’s healthcare providers.
The HITECH Act presents both opportunities and challenges to all involved in the healthcare sector. The legislation and the rules resulting from it are lengthy, time-consuming to digest, and at times confusing. However, the incentives provided under the act – as well as the ensuing advantages of electronic healthcare technology – serve to offset the initial investment and result in long-term gains for practices. Following is a summary of the essentials of the HITECH Act and what it means to physicians in simple, “plain English” terms.
Components of the HITECH Act
There are two main components of the HITECH Act – (1) funding to the States to establish and promote the use of healthcare information exchange initiatives, and (2) incentive payments to physicians and hospitals that demonstrate “meaningful use” of electronic healthcare technologies. Of these two, the incentive payments to individual physicians have attracted the most attention among providers and industry leaders, and will be the focus of the remainder of this article..
The lion’s share of funding under the HITECH Act is earmarked for payments to reward physicians and hospitals that effectively implement connected electronic healthcare technologies. The goal of this investment is to encourage providers who have been slow to adopt electronic technologies to do so, as well as provide a connectivity among various healthcare providers, insurance companies, and governmental agencies.
Payments under the HITECH Act will be made as a percentage of either Medicaid or Medicare reimbursements. Physicians may choose one of these programs in which to participate. In order to qualify for the incentives in either program, providers must show proficiency in three areas:
- Use of a certified electronic healthcare record including e-prescribing
- Connectivity to other providers to improve access to patient records
- Ability to report their technology use to the appropriate agencies.
Medicaid Incentive Program
Physicians with more than 30% of patients paying with Medicaid are eligible for incentive payments of up to $64,000 over a six year period. Payments are based on a percentage of Medicaid payments subject to an annual cap. Participants in this program can receive the incentives as they adopt and implement electronic healthcare technologies into their practice, and begin providing “meaningful use” in the second year of participation.
Medicare Incentive Program
Most practices will choose to participate in the Medicare Incentive program, as many patients are covered under Medicare. This program provides for an incentive of up to $44,000 over a five-year period, based on 75% of the physician’s Medicare reimbursements subject to an annual cap. (Physicians practicing in determined “health provider shortage” areas will be eligible for a 10% bonus payment, and those practicing entirely within a hospital environment are ineligible to participate in this program).
The following table shows the maximum EHR incentive payments by each program based on the first calendar year (CY) for which the Eligible Provider (EP) receives payment.
2013 EHR Incentive Program Data Released
In an HIT Policy Committee meeting in June 2013, Robert Anthony, deputy director of the Health IT Initiative Group at CMS’ Office of E-Health Standards and Services, reviewed the most current data on CMS EHR Incentive Program participation. The HIT Policy Committee makes recommendations to the National Coordinator for Health IT on a policy framework for the development and adoption of a nationwide health information infrastructure.
At the June meeting, Anthony reported the latest data showing progress made by Eligible Professionals and Eligible Hospitals participating in the CMS EHR Incentive Program. Through April, 2013, $14.6 billion in incentives have been paid to Eligible Professionals and Eligible Hospitals participating in the program.
At the meeting Anthony also released the following data:
- 2,977 hospitals had successfully attested to meaningful use
- 75% of eligible hospitals had made a financial commitment to certified EHR technology
- 55% of Medicare- and Medicaid- eligible professionals had made a financial commitment to certified EHR technology
- 75% of eligible professionals have registered for the EHR Incentive program
- 77% of registered Eligible Hospitals have been paid under the program
- 63% of all Eligible Professionals participating in the Medicaid EHR Incentives have received a payment
- 61% of Eligible Professionals meeting meaningful user for Medicaid and Medicare were in specialty care
The ONC tracks progress of the EHR Incentive program through an Inforgraphics chart for anyone to follow. Along with reporting incentive payments made, the ONC also monitor progress made by the Regional Extension Centers and in the job market.
Some other current stats on the impact of the program:
- The RECs have provided EHR adoption assistance to over 130,000 primary providers and 20,000 nurse practitioners
- There are more than 1,700 unique certified EHR products
- ePrescribing is now used by over 50% of all office-based physicians
- Under the ONC Workforce Development Program, community colleges have trained over 17,500 health IT professionals.
HITECH Act: Physician Reimbursement Penalty Plan
The Medicare plan also provides a penalty for those physicians who receive Medicare reimbursements that fail to adopt electronic technologies by 2015 will be penalized by reductions in their reimbursements. The penalty is 1% of reimbursements in 2015, increasing to 2% in 2016 and 3% in 2017.