Frequently Asked Questions
Click on a question below for answers to commly asked questions. Please note the reference links throughout the information for their original sources. All individuals and institutions should review the American Recovery and Reinvestment Act of 2009 directly or seek advice of counsel. Contact LSS if you have specific questions.
*These FAQs have not yet been updated to reflect the final regulations released July 13, 2010. Updates are currently in process.
General Questions
What are the incentive program time frames?
What is the Centers for Medicare and Medicaid Services Notice of Proposed Rulemaking (CMS NPRM)?
What is the Office of the National Coordinator Interim Final Rule (ONC IFR)?
What qualifies a user as a "meaningful EHR user"?
What are the 25 Eligible Professional (EP) Meaningful Use Objectives and Measures?
How will the measure data be submitted to CMS?
Can an eligible professional qualify for multiple incentive programs through the ARRA?
How are hospital-based eligible professionals defined?
Does a group practice qualify as a whole, or does each eligible professional (EP) qualify individually?
How will the new certification process work?
What is the Federal Healthcare Information Technology Standards Committee?
What is the Federal Health Information Technology Policy Committee?
Medicare Incentive Program
When will Medicare incentive payments begin?
Who is an eligible professional?
What are covered professional services?
How much are the incentives for Eligible Professionals (EPs)?
What are the penalties associated with not using a certified EHR technology in a meaningful way?
What's a Medicare incentive payment example?
What's a Medicare payment adjustment example?
Medicaid Incentive Program
When will Medicaid incentive payments begin?
Who is an eligible professional?
What are the average allowable costs for the Medicaid incentive?
If an eligible professional qualifies for both the Medicare and Medicaid programs and selects Medicaid, but doesn’t begin implementing until 2016 are they subject to the penalties under the Medicare program?
How are needy individuals defined?
How is "meaningful use" defined for the Medicaid Program?
How is an electronic health record identified as a certified EHR?
How much are the incentives?
What are the incentive program time frames?
| Date | Milestone |
| 2010 |
|
| No Sooner than October 2010 |
|
| No Sooner than January 2011 |
|
| 2011 – 2016 |
|
| 2011 -2021 |
|
| 2015 and thereafter |
|
What is the Centers for Medicare and Medicaid Services Notice of Proposed Rulemaking (CMS NPRM)?
A Notice of Proposed Rulemaking is an announcement published in the Federal Register of proposed new regulations or modifications to existing regulations; this is the first stage in the process of creating or modifying regulations. In this case the CMS NPRM defines meaningful use and the provisions for incentive payments to eligible professionals and hospitals participating in Medicare and Medicaid Incentive Programs that adopt and meaningfully use certified EHR technologies.
The CMS NPRM was published in the Federal Register on January 13, 2010 and CMS has issued a 60 day public comment period that will end on March 15, 2010. After the comment period has ended CMS will respond to the public comments submitted and issue their final regulation. The final regulation is expected sometime in April of 2010.
What is the Office of the National Coordinator Interim Final Rule (ONC IFR)?
An Interim Final Rule is an announcement published in the Federal Register to make new regulations or modifications to existing regulations; but only used when necessary to accelerate the rulemaking process. An Interim Final Rule will usually take effect 30 days after it is published.
The ONC IFR defines the standards, certification criteria, and implementation specifications for the Medicare and Medicaid Incentive Programs. The ONC IFR was published on January 13, 2010 and will take effect on February 12, 2010. ONC has issued a 60 day public comment period that will end on March 15, 2010, at which time ONC will review and respond to any public comments. They may also at that time make any necessary changes to the issued regulations. This process is expected to be finalized by sometime in April of 2010.
http://healthit.hhs.gov/portal/server.pt?open=512&objID=1153&mode=2
What qualifies a user as a "meaningful EHR user"?
There are three main requirements an eligible professional (EP) needs to meet to be identified as a meaningful EHR user. The first is that the eligible professional demonstrates, to the satisfaction of the Secretary of Health and Human Services, that they are using a certified EHR in a meaningful manner, which shall include the use of electronic prescribing as determined by the Secretary.
The second requirement is that the professional can demonstrate that the certified EHR technology is connected in a manner that provides for the electronic exchange of health information to improve the quality of health care such as promoting care coordination. The demonstration of these two requirements may require the professional to provide:
- an attestation
- the submission of claims with appropriate coding (such as a code indicating that a patient encounter was documented by using a certified EHR technology)
- a survey response
- and any other measures specified by the Secretary
The final requirement is that the professional report any quality measures selected by the Secretary, with a focus on clinical quality measures. All measures shall be published in the Federal Register, prior to the Secretary's selection, for public comment.
CMS published on January 13, 2010, a Notice of Proposed Rule Making (NPRM) in the Federal Register which includes further clarification on meaningful use and the quality reporting requirements. CMS's proposed meaningful use definition is based on five broad health outcomes:
- Improve quality, safety, efficiency, and reduce health disparities
- Engage patients and families
- Improve care coordination
- Improve population and public health
- Ensure adequate privacy and security protections for personal health information
In each of these categories CMS has identified meaningful use objectives and measures for a total of 25 that each EP will have to meet. One of those objectives is reporting on clinical quality measures, which are also outlined in the rule. CMS has identified 90 possible clinical quality measures, of which each EP will report on a subset of the those measures, a core set and measures based on the EP's specialty.
Section II.A.2 (Pages 1850 – 1870) of the CMS NPRM
Division B, Title IV, Subtitle A, Sec 4101(a2)
What are the 25 Eligible Professional (EP) Meaningful Use Objectives and Measures?
The following chart outlines all of the Stage 1 Meaningful Use Objectives and Measures for EPs. The column to the right identifies the reporting structure for the measures in 2011 (Y/N – Yes or no submitted as structured data; N/D – A numerator and denominator are submitted for each measure through attestation).
| Stage 1 Proposed Objectives and Measures for Eligible Professionals (EP) | |||
| # | Objective | Measure | R |
| 1 | Use Computerized Provider Order Entry (CPOE) | For EPs, CPOE is used for at least 80% of all orders | N/D |
| 2 | Implement drug-drug, drug-allergy, drug-formulary checks | The EP has enabled this functionality | Y/N |
| 3 | Maintain an up-to-date problem list of current and active diagnoses based on ICD-9-CM or SNOMED CT® | At least 80% of all unique patients seen by the EP have at least one entry or an indication of none recorded as structured data | N/D |
| 4 | Generate and transmit permissible prescriptions electronically (eRx) | At least 75% of all Permissible prescriptions written by the EP are transmitted electronically using certified EHR technology | N/D |
| 5 | Maintain active medication list | At least 80% of all unique patients seen by the EP have at least one entry (or an indication of "none" if the patient is not currently prescribed any medication) recorded as structured data | N/D |
| 6 | Maintain active medication allergy list | At least 80% of all unique patients seen, by the EP have at least one entry or (an indication of "none" if the patient has no medication allergies) recorded as structured data | N/D |
| 7 | Record demographics: - preferred language - insurance type - gender - race - ethnicity - date of birth |
At least 80% of all unique patients seen by the EP have demographics recorded as structured data | N/D |
| 8 | Record and chart changes in vital signs: - height - weight - blood pressure - calculate and display: BMI - plot and display growth charts for children 2-20 years, including BMI |
For at least 80% of all unique patients age 2 and over seen by the EP record blood pressure and BMI; additionally plot growth chart for children age 2-20 | N/D |
| 9 | Record smoking status for patients 13 years old or older | At least 80% of all unique patients 13 years old or older seen by the EP have "smoking status" recorded | N/D |
| 10 | Incorporate clinical lab-test results into EHR as structured data | At least 50% of all clinical lab tests ordered whose results are in a positive/negative or numerical format are incorporated in certified EHR technology as structured data | N/D |
| 11 | Generate lists of patients by specific conditions to use for quality improvement, reduction of disparities, and outreach | Generate at least one report listing patients of the EP with a specific condition | Y/N |
| 12 | Report ambulatory quality measures to CMS or the States | For 2011, provide aggregate numerator and denominator through attestation as discussed in section II(A)(3) of the CMS NPRM. For 2012, electronically submit the measures as discussed in section II(A)(3) of the CMS NPRM | N/D |
| 13 | Send reminders to patients per patient preference for preventive/ follow up care | Reminder sent to at least 50% of all unique patients seen by the EP that are age 50 or over | N/D |
| 14 | Implement 5 clinical decision support rules relevant to specialty or high clinical priority, including diagnostic test ordering, along with the ability to track compliance with those rules | Implement 5 clinical decision support rules relevant to the clinical quality metrics the EP is responsible for as described further in section II(A)(3) of the CMS NPRM | Y/N |
| 15 | Check insurance eligibility electronically from public and private payers | Insurance eligibility Checked electronically for at least 80% of all unique patients seen by the EP | N/D |
| 16 | Submit claims electronically to public and private payers | At least 80% of all claims filed electronically by the EP | N/D |
| 17 | Provide patients with an electronic copy of their health information (including diagnostic test results, problem list, medication lists, allergies), upon request | At least 80% of all patients who request an electronic copy of their health information are provided it within 48 hours | N/D |
| 18 | Provide patients with timely electronic access to their health information (including lab results, problem list, medication lists, allergies) within 96 hours of the information being available to the eligible professional | At least 10% of all unique patients seen by the EP are provided timely electronic access to their health information | N/D |
| 19 | Provide clinical summaries for patients for each office visit | Clinical summaries are provided for at least 80% of all office visits | N/D |
| 20 | Capability to exchange key clinical information (for example problem list, medication list, allergies, diagnostic test results) among providers of care and patient authorized entities electronically | Performed at least one test of certified EHR technology's capacity to electronically exchange key clinical information | Y/N |
| 21 | Provide summary care record for each transition of care and referral | Provide summary of care record for at least 80% of transitions of care and referrals | N/D |
| 22 | Perform medication reconciliation at relevant encounters and each transition of care | Perform medication reconciliation for at least 80% of relevant encounters and transitions of care | N/D |
| 23 | Capability to submit electronic data to immunization registries and actual submission where required and accepted | Performed at least one test of certified EHR technology's capacity to submit electronic data to immunization registries | Y/N |
| 24 | Capability to provide electronic syndromic surveillance data to public health agencies and actual transmission according to applicable law and practice | Performed at least one test of certified EHR technology's capacity to provide electronic Syndromic surveillance data to public health agencies (unless none of the public health agencies to which an EP submits such information have the capacity to receive the information electronically) | Y/N |
| 25 | Protect electronic health information created or maintained by the certified EHR technology through the implementation of appropriate technical capabilities | Conduct or review a security risk analysis per 45 CFR 164.308 (a)(1) and implement security updates as necessary | Y/N |
Section II.A.2.d (Pages 1854 - 1870) of the CMS NPRM
How will the measure data be submitted to CMS?
All meaningful use measures and clinical quality reporting will be submitted through a one time attestation in 2011 after the end of the reporting period. In 2012 all the meaningful use measures except for clinical quality reporting will be reported through a one time attestation at the end of the reporting period. Clinical quality measures in 2012 will at least be partially submitted electronically to CMS.
As EHR technology and meaningful use progresses CMS is expected to change the reporting requirements to include more direct electronic data submission. More details are expected regarding the process of submitting this data electronically to CMS on or before July 1, 2011 for eligible professionals.
Section II.A.4.b (Page 1903) of the CMS NPRM
Can an eligible professional qualify for multiple incentive programs through the ARRA?
An eligible professional (EP) may be qualified for multiple programs through the ARRA, but they are only able to receive incentive dollars through one of the programs. This makes it important for an EP to analyze their current patient encounters and eligible charges to select the appropriate program for their practice. CMS has indicated that providers do have the options to switch between programs one time over the duration of the incentives.
If an EP elects to switch programs, CMS will transition the EP to the new program on the same year of eligibility as their previous program. For example, if you receive two years of incentives through the Medicare program, you would transition to the Medicaid program starting on your third year of eligibility.
Section II.A.5 (Pages 1903 - 1904) of the CMS NPRM
How are hospital-based eligible professionals defined?
The ARRA defines hospital-based provider as:
"…an eligible professional during the EHR reporting period for a payment year, an eligible professional, such as a pathologist, anesthesiologist, or emergency physician, who furnishes substantially all of such services in a hospital inpatient or emergency room setting and through the use of the facilities and equipment, including qualified electronic health records, of the hospital. The determination of whether an eligible professional is a hospital-based eligible professional shall be made on the basis of the site of service (as defined by the Secretary) and without regard to any employment or billing arrangement between the eligible professional and any other provider." - Section 4101(a) of the ARRA, as amended by H.R. 4851.
The CMS NPRM defines an eligible professional (EP) based on the Place of Service (POS) code on a physician claim. They identified that if an EP submitted the code of 21 – Inpatient Hospital, 22 – Outpatient Hospital, or 23 – Emergency Room, for 90 percent or more of their covered Medicare professional services, they would be considered a hospital-based professional. However, the new amendment (H.R. 4851) from April 2010 removed "whether inpatient or outpatient" and replaced it with "inpatient or emergency room." Therefore, CMS is expected to update their definition in the final rule to include these Congressional changes, which if they follow the same structure, will remove the 22 – Outpatient Hospital code from the definition.
CMS has also proposed for the Medicare program to use the prior year's claim data to calculate whether an EP is hospital-based or not in each payment year. This means an EP may be considered a hospital-based provider in 2011 based on 2010 claims data, but not a hospital-based provider in 2012 based on 2011 claims data. For the Medicaid program states will need to analyze the EP's Medicaid claims data.
There is one exception to this rule. Medicaid EPs practicing in Rural Health Clinics and Federally Qualified Health Centers are exempt from the hospital-based exclusion.
Section II.A.6 (Pages 1904 – 1907) of the CMS NPRM
Section 5.a.1(Pages 5-6) of H.R. 4851
Does a group practice qualify as a whole, or does each eligible professional (EP) qualify individually?
The incentive programs are designed to be implemented on an individual provider basis. For example, in a group practice with 8 providers, each provider has the ability to participate in either program (Medicare or Medicaid) for which they are eligible. Individual physicians within the practice do not have to qualify in the same year, meaning that if one qualifies in 2011 and the rest do not until 2012, those qualifying in 2012 will not loose a year of eligibility.
The Medicare Advantage program, on the other hand, requires that all providers within the Medicare Advantage Organization qualify in the same year. This means that if one eligible professionals (EP) qualifies in 2011 and the rest not until 2012, then the later qualifying EPs will loose out on a year of eligibility through that program.
Section II.B-D (Pages 1907 – 1948) of the CMS NPRM
How will the new certification process work?
To qualify for the incentive payments eligible professionals and health care organizations are required to implement a certified EHR technology. Currently the only Federally recognized certification body is the Certification Commission for Health Information Technology (CCHIT), but the ARRA redefines certification criteria and standards and creates a new certification processes.
The new process gives the power to the National Coordinator, in consultation with the Director of the National Institute of Standards and Technology, to recognize a certification program or programs to qualify EHR technology. The Office of the National Coordinator (ONC) has decided to replace their current certification recognition program and has proposed both a new temporary and permanent certification program, to meet the deadlines laid out in the ARRA.
The temporary program final rule was published June 24, 2010 and outlines the selection process for the newly created Authorized Testing and Certification Bodies (ONC-ATCB). ONC will begin selecting ONC-ATCBs and once that and the final certification criteria are published EHR products can begin being certified. The temporary program will expire on December 31, 2012 and be replaced by the permanent program.
The law also creates a process for identifying new certification criteria through the Department of Health and Humans Services and the ONC. On January 13, 2010 the ONC published in the Federal Register an Interim Final Rule (IFR) outlining the new certification criteria, standards, and implementation specifications.
Section III.C (Pages 2023 – 2037) of the ONC IFR
Division B, Title IV, Subtitle A, Sec 4101(a4)
Division A, Title XIII, Subtitle A, Sec 3001(c5)
What is the Federal Healthcare Information Technology Standards Committee?
The HIT Standards Committee was created as Federal Advisory Committee to make recommendations to the National Coordinator on standards, implementation specifications, and certification criteria for the electronic exchange and use of health information. The committee must also work with the HIT Policy Committee to develop, harmonize, and test recognized standards.
The HIT Standards Committee is comprised of providers, ancillary healthcare workers, consumers, purchasers, health plans, technology vendors, researchers, relevant Federal agencies, and individuals with technical expertise on health care quality, privacy and security, and on the electronic exchange and use of health information. The committee held their first meeting May 15, 2009 and has developed a monthly meeting schedule. For more information about the committee and their meetings please visit their website.
Division A, Title XIII, Section 3003
What is the Federal Health Information Technology Policy Committee?
The HIT Policy Committee was created as a Federal Advisory Committee to make recommendations to the National Coordinator relating to the implementation of a nationwide health information technology infrastructure, including implementation of the national HIT strategic plan. Their duties also include identifying areas where the HIT Standards Committee should be creating and defining standards, implementation specifications, and certification criteria.
The committee is comprised of thirteen members representing different areas of the health sector, three appointed by the DHHS Secretary and four political appointees, for a total of 20 members. The HIT Policy Committee convened on May 11, 2009 and has been meeting monthly since. For more information about the committee and their meetings please visit their website.
Division A, Title XIII, Section 3002
|
MEDICARE For a provider to qualify for the incentive through the Medicare program they need to be an eligible professional, who provides covered professional services while being a meaningful user of a certified EHR technology during an EHR reporting period. ~Section II.B (Pages 1907 – 1920) of the CMS NPRM ~Division B, Title IV, Subtitle A, Sec 4101 |
When will Medicare incentive payments begin?
Medicare incentive payments can begin as early as 90 days after the start of incentive program on January 1, 2011 for eligible professionals (EPs). To be eligible for the maximum incentive dollars an EP will need to begin demonstrating meaningful use sometime before October 1, 2012.
Section II.B.4 (Pages 1919 – 1920) of the CMS NPRM
Who is an eligible professional?
The stimulus act defines an eligible professional using the definition from Section 1861(r) of the Social Security Act. An eligible professional is:
- a doctor of medicine or osteopathy
- a doctor of dental surgery or dental medicine
- a doctor of podiatric medicine
- a doctor of optometry
- a chiropractor
All of which must be legally authorized to practice medicine, surgery, or other care by the state in which they perform such functions or actions.
Currently hospital-based professionals, such as pathologists or anesthesiologists, are not eligible for this incentive program. The CMS Notice of Proposed Rulemaking defines hospital-based professionals to be those professionals providing greater than 90% of their covered services from a hospital place of service.
Section II.B.1.a (Pages 1907 – 1908) of the CMS NPRM
What are covered professional services?
Covered professional services, are defined as any service for which payment is made under, or is based on, the Physician Fee Schedule (PFS) published each year by the Centers for Medicare & Medicaid Services.
Section II.B.1.a (Pages 1907 – 1908) of the CMS NPRM
How much are the incentives for Eligible Professionals (EPs)?
The Medicare Fee-for Service program is designed to offer both a carrot & a stick. The programs include both incentive payments for meaningful use and also payment reductions to reimbursed professional services for EPs and eligible hospitals.
For EPs the incentives and adjustments are based on when a professional becomes a "meaningful user" of a certified EHR technology. If the EP becomes a meaningful user before 2014 they are eligible for incentive payments. If the EP doesn't become a meaningful user by 2015 they may be subject to an adjustment in their covered professional services through Medicare.
The payment schedule below illustrates the standard incentive schedule for Medicare EPs. The incentive payments are paid out over three to five payment years. In the first payment year the EP is eligible for up to $15,000, unless the first payment year is either 2011 or 2012, where the EP is eligible for $18,000. This is in an effort to reward early adopters of certified EHR technologies. The subsequent four payments years work as follows:*
- Second payment year – $12,000
- Third payment year – $8,000
- Fourth payment year – $4,000
- Fifth payment year – $2,000
If the EP's first payment year is after 2013 then the initial payment decreases to the second year payment of $12,000. The incentives are also limited so that any EP who adopts after 2014 will not be eligible for an incentive program. The ARRA also specifies that no incentive payments will be paid out after 2016.
| Calendar Year (CY) | First CY in which the EP receives an incentive payment | ||||
| 2011 | 2012 | 2013 | 2014 | 2015+ | |
| 2011 | $18,000 | ||||
| 2012 | $12,000 | $18,000 | |||
| 2013 | $8,000 | $12,000 | $15,000 | ||
| 2014 | $4,000 | $8,000 | $12,000 | $12,000 | |
| 2015 | $2,000 | $4,000 | $8,000 | $8,000 | $0 |
| 2016 | $2,000 | $4,000 | $4,000 | $0 | |
| Total | $44,000 | $44,000 | $39,000 | $24,000 | $0 |
Section II.B.1.b (Pages 1908) of the CMS NPRM
Division B, Title IV, Subtitle A, Sec 4101(a)
In the case of an EP who provides covered professional services in an area designated, by the Secretary as a health professional shortage area (HSPA), the amount of their incentive shall be increased by 10 percent. The payment schedule below helps to illustrate this additional incentive through the Medicare Fee-for Service program.*
| Calendar Year (CY) | First CY in which the EP receives an incentive payment in a HPSA | ||||
| 2011 | 2012 | 2013 | 2014 | 2015+ | |
| 2011 | $19,800 | ||||
| 2012 | $13,200 | $19,800 | |||
| 2013 | $8,800 | $13,200 | $16,500 | ||
| 2014 | $4,400 | $8,800 | $13,200 | $13,200 | |
| 2015 | $2,200 | $4,400 | $8,800 | $8,800 | $0 |
| 2016 | $2,200 | $4,400 | $4,400 | $0 | |
| Total | $48,400 | $48,400 | $42,900 | $26,400 | $0 |
Section II.B.1.b (Pages 1908) of the CMS NPRM
Division B, Title IV, Subtitle A, Sec 4101(a)
What are the penalties associated with not using a certified EHR technology in a meaningful way?
Penalties will by implemented through payment adjustments to fee schedule reimbursements made to EPs for covered professional services. If an EP hasn't demonstrated meaningful use successfully by 2015 or each year after they are subject to the Medicare penalties. The EP's fee schedule reimbursement amount will be reduced to 99 percent in 2015, 98 percent in 2016, and 97 percent in 2017 and in each subsequent year for all covered professional services. For 2018 and each subsequent year, if the Secretary finds that the proportion of eligible professionals who are meaningful EHR users is less than 75 percent, the applicable fee schedule amount will be decreased by one percentage point from the applicable percent in the preceding year, but in no case will the applicable percent be less than 95 percent.
The Secretary on a case-by-case basis may EPs from the payment adjustment if the requirements to be a meaningful user pose a significant hardship on the EP. An example would be in the case of an EP who practices in a rural area without sufficient internet access. Exemptions are subject to annual renewal and will not be granted for more than five years.
CMS will propose more detailed regulations prior to the 2015 implementation date of the Medicare Fee-for Service Penalties.
Section II.B.1.e (Page 1911) of the CMS NPRM
What's a Medicare incentive payment example?
Provider A Example
Provider A becomes a meaningful user of a certified EHR technology by the beginning of 2011 and reports all the appropriate measures and information to CMS beginning in 2011 through the end of the program. Provider A also submits $25,000 worth of allowable charges to Medicare each year in 2011 through 2015. Provider A's incentive schedule will look like this:
Date of Certified EHR Adoption: January 1, 2011
Date of Meaningful Use: January 1, 2013
Practice in a Health Professional Shortage Area: No
| Estimated Incentive Payments | ||
| Allowable Charges | Payment Year | Incentive Amount Paid |
| $25,000 | 2011 | $18,000 |
| $25,000 | 2012 | $12,000 |
| $25,000 | 2013 | $8,000 |
| $25,000 | 2014 | $4,000 |
| $25,000 | 2015 | $2,000 |
|
Total Incentive | $44,000 |
| * Since 75 percent of the providers total allowed charges is over the maximum incentive in each payment year then the provider is eligible for the maximum payment in each year. | ||
Provider B Example
Provider B adopts an electronic record in 2011 but does not become a meaningful user until 2013. Provider B submits $15,000 worth of allowable charges to Medicare each year in 2011 through 2016. Provider B's incentive schedule will look like this:
Date of Certified EHR Adoption: January 1, 2011
Date of Meaningful Use: January 1, 2013
Practice in a Health Professional Shortage Area: Yes*
| Estimated Incentive Payments | ||
| Submitted Allowable Charges | Payment Year | Incentive Amount Paid** |
| $15,000 | 2011 | N/A |
| $15,000 | 2012 | N/A |
| $15,000 | 2013 | $11,250 + 10% = $12,375 |
| $15,000 | 2014 | $11,250 + 10% = $12,375 |
| $15,000 | 2015 | $8,000 + 10% = $8,800 |
| $15,000 | 2016 | $4,000 + 10% = $4,400 |
|
Total Incentive | $37,950 |
| * The provider receives 75% of the allowable charges up to the maximum amounts in each year, plus the additional 10% for practicing in a Health Professional Shortage Area. ** The first payment year of the incentive program begins when meaningful use is demonstrated. |
||
What's a Medicare payment adjustment example?
Provider A Example
Provider A does not adopt a qualified certified electronic health record until after the adjustment begins. If the same payment information holds true from above, Provider A's payment adjustment would look like this between 2015 and 2019:
Date of Certified EHR Adoption: N/A
Date of Meaningful Use: N/A
Practice in a Health Professional Shortage Area: No
| Estimated Incentive Payments | ||
| Submitted Allowable Charges | Payment Year | Charges Reimbursed* |
| $25,000 | 2015 | $24,750 |
| $25,000 | 2016 | $24,500 |
| $25,000 | 2017 | $24,250 |
| $25,000 | 2018 | $24,000 |
| $25,000 | 2019 | $23,750 |
|
Total Adjustment | $3,750 |
| * The payment adjustment starts in 2015 as a 1% reduction. The reduction increases by an additional 1% in 2016 and 2017, for total adjustments of 2% and 3% respectively. For 2018 and beyond, if deemed necessary, CMS can adjust an additional 1% in each year but may never exceed a total adjustment of 5% in any year. | ||
| MEDICAID To qualify for the Medicaid incentive the provider again needs to be an eligible professional under the program and can demonstrate costs associated to the purchase, implementation or use of a certified EHR technology. ~Section II.D (Pages 1907 – 1920) of the CMS NPRM ~Division B, Title IV, Subtitle A, Sec 4101 |
When will Medicaid incentive payments begin?
There is no statutory implementation date for the Medicaid Incentive Program because it will be implemented by each state. CMS has indicated that some states may be prepared to implement their program and make EHR incentive payments as early as 2010 for adopting, implementing or upgrading certified EHR technology. States will need to demonstrate their readiness to CMS prior to starting their Medicaid Incentive Program.
Who is an eligible professional (EP)?
The Medicaid Incentive Program defines an EP using the same definition as the Medicare Fee-for Service Program, but also includes additional providers and requirements. Medicare defines EP from Section 1861(r) of the Social Security Act. An EP is:
- a doctor of medicine or osteopathy
- a doctor of dental surgery or dental medicine
- a doctor of podiatric medicine
- a doctor of optometry
- a chiropractor
All of which must be legally authorized to practice medicine, surgery, or other care by the state in which they perform such functions or actions. The Medicaid Incentive Program adds on to this definition to include:
- a dentist
- a certified nurse mid-wife
- a nurse practitioner
- a physician assistant practicing in a Rural Health Clinic (RHC) or a Federally Qualified Health Center (FQHC)
All of these providers are also subject to the following three patient threshold requirements to qualify as a Medicaid EP:
- A non-hospital-based provider with at least 30 percent of patient volume attributable to individuals receiving Medicaid Assistance
- A non-hospital-based pediatrician with at least 20 percent of patient volume attributable to individuals receiving Medicaid assistance
- A non-hospital-based provider practicing predominately in a Federally Qualified Health Center or rural health clinic with at least 30 percent of patient volume attributable to needy individuals
Section II.D.3.c & d (Pages 1931 – 1932) of the CMS NPRM
What are the average allowable costs for the Medicaid incentive?
The average allowable costs are broken into two categories which are associated with the years of payment. The ARRA outlined that the Secretary of HHS was to conduct a study on EHR technology to identify the average allowable costs in each of these categories. The first category is linked to the first year of payment for an eligible professional (EP). In the first year of payment the average allowable costs are the costs associated with the purchase and initial implementation or upgrade of a certified EHR technology (and support services including training that is for the adoption and initial operation of, such technology).
The second category is tied to each subsequent year after the first year of payment. In each subsequent year the average allowable costs are the costs relating to the operation, maintenance, and use of a certified EHR technology.
CMS has proposed that the average allowable costs for the first year of payment be set at $54,000. For subsequent payment years the average allowable cost is proposed to be set at $20,610.
The ARRA capped the Medicaid Incentive Payments at 85% of the net average allowable cost of $25,000 in the first year and $10,000 in each subsequent year. What this means is that Medicaid EPs can receive $29,000 (54,000-25,000=29,000) from other sources in the first year and $10,610 (20,610-10,000=10,610) in each subsequent year. Other sources would include other federal and state assistant or incentive programs like the e-prescribing incentive offered through the Medicare Improvements for Patients and Providers Act (MIPPA) of 2008.
Section II.D.4.a.(2) (Pages 1933 – 1934) of the CMS NPRM
If an eligible professional qualifies for both the Medicare and Medicaid programs and selects Medicaid, but doesn’t begin implementing until 2016 are they subject to the penalties under the Medicare program?
Currently there are two ways an eligible professional (EP) submitting eligible Medicare charges can avoid receiving payment adjustments. The first is by implementing and demonstrating meaningful use of a certified EHR technology and the second would be to qualify for a significant hardship exemption.
Significant hardship exemptions may be granted on a case-by-case basis by the Secretary of HHS on a year-by-year basis. EPs cannot be granted this exemption for more than 5 years.
CMS has indicated that in future rule making the payment adjustments will be further clarified, so these rules may specifically references the concerns addressed in this question.
Section II.B.1.e (Page 1911) of the CMS NPRM
How are needy individuals defined?
A needy individual with respect to the Medicaid Incentive Program is one:
- Who is receiving assistance under Medicaid
- Who is receiving assistance under title XXI
- Who is furnished uncompensated care by a provider, or
- For whom charges are reduced by the provider on a sliding scale basis based on an individual’s ability to pay.
How is "meaningful use" defined for the Medicaid Program?
Meaningful use under the Medicaid Incentive Program is demonstrated through a means that is approved by the State and accepted by the Secretary. The approved method the State selects needs to be consistent with the requirements outlined in the Medicare meaningful use section.
How is an electronic health record identified as a certified EHR?
The same certification criteria that apply to the Medicare Incentive Program also apply to the Medicaid Incentive Program.
How much are the incentives?
The Medicaid Incentive Program authorizes states to make payment to Medicaid EPs totaling no more than 85 percent of net average allowable costs for the purchase, upgrade, implementation or use of a certified EHR technology. The incentive is capped at 85 percent of $25,000 ($21,250) on a per provider basis in the first year of payment which may not be later than 2016. Each subsequent year after the first payment year is capped at 85 percent of $10,000 ($8,500) per provider and cannot be paid over a period longer than five years. EPs are eligible for a total of $63,750 over the six years of the program.*
No EP qualifying for the program after 2016 may receive payment so the final year an EP could receive payment would be in 2021. The Medicaid incentive schedule is also adjusted for non-hospital-based pediatricians with at least 20 percent of patient volume, but less than 30 percent attributable to individuals receiving Medicaid assistance. For these providers their maximum allowable incentive is capped at two-thirds of the other amounts. Therefore pediatricians qualifying under this program could receive a maximum incentive of $42,500, over the six years of the program.
Incentive Schedule for Medicaid Eligible Professionals (EPs)
| Calendar Year (CY) | Medicaid EPs who begin adoption in | |||||
| 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | |
| 2011 | $21,250 | |||||
| 2012 | $8,500 | $21,250 | ||||
| 2013 | $8,500 | $8,500 | $21,250 | |||
| 2014 | $8,500 | $8,500 | $8,500 | $21,250 | ||
| 2015 | $8,500 | $8,500 | $8,500 | $8,500 | $21,250 | |
| 2016 | $8,500 | $8,500 | $8,500 | $8,500 | $8,500 | $21,250 |
| 2017 | $8,500 | $8,500 | $8,500 | $8,500 | $8,500 | |
| 2018 | $8,500 | $8,500 | $8,500 | $8,500 | ||
| 2019 | $8,500 | $8,500 | $8,500 | |||
| 2020 | $8,500 | $8,500 | ||||
| 2021 | $8,500 | |||||
| Total | $63,750 | $63,750 | $63,750 | $63,750 | $63,750 | $63,750 |
Incentive Schedule for Medicaid Pediatric EPs
| Calendar Year (CY) | Medicaid EP Pediatricians with greater than 20% but less than 30% patient volume, who begin adoption in | |||||
| 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | |
| 2011 | $14,167 | |||||
| 2012 | $5,667 | $14,167 | ||||
| 2013 | $5,667 | $5,667 | $14,167 | |||
| 2014 | $5,667 | $5,667 | $5,667 | $14,167 | ||
| 2015 | $5,667 | $5,667 | $5,667 | $5,667 | $14,167 | |
| 2016 | $5,667 | $5,667 | $5,667 | $5,667 | $5,667 | $14,167 |
| 2017 | $5,667 | $5,667 | $5,667 | $5,667 | $5,667 | |
| 2018 | $5,667 | $5,667 | $5,667 | $5,667 | ||
| 2019 | $5,667 | $5,667 | $5,667 | |||
| 2020 | $5,667 | $5,667 | ||||
| 2021 | $5,667 | |||||
| Total | $42,500 | $42,500 | $42,500 | $42,500 | $42,500 | $42,500 |
Section II.D.4.a.(4) (Pages 1935 – 1937) of the CMS NPRM
*The incentives represented on this page are the maximum that are allowed under the American Recovery and Reinvestment Act of 2009. The actual incentive payment will vary by provider based on the provider's total reimbursement from Medicare and Medicaid. The Medicaid incentive payments may also vary based on the level of support provided from other Federal and State organizations to adopt a certified EHR technology that is being implemented. Each organization should directly review the American Recovery and Reinvestment Act of 2009 CMS NPRM, and the ONC IFR for complete details and determination of how it would apply.
