EHR Rules Loosen Requirements; Multi-Campus Hospitals Get One Payment

HHS made it easier for hospitals and doctors to receive incentive payments for using electronic health records by reducing the number of requirements they must meet to be considered “meaningful users” of EHR in a pair of rules released today. But hospital are disappointed that CMS will give a single base payment to hospitals with multiple campuses if those campuses are registered under the same CMS certification number. Adoption of EHRs is a key goal of health reform.

House Ways and Means Committee leaders voiced concerns about the decision not to pay individual bonus payments to each campus of a hospital system. Health subcommittee Chair Pete Stark (D-CA) said he intends to “study future steps to address this issue” and has scheduled a July 30 hearing on the EHR requirements.

CMS and the Office of the National Coordinator for Health Information Technology (ONC) on Tuesday (July 13) announced the companion final rules that implement the Health Information Technology for Economic and Clinical Health Act. The HITECH Act, which was part of the 2009 stimulus package, is expected to pay out $27 billion over 10 years to spur EHR adoption. The final rules make “significant changes” to the proposed rules that HHS issued in January, prompting about 2,000 public comments.

HHS said the adoption of electronic records will help clinicians avoid errors, reduce costly duplication of tests and make it easier for patients to obtain their own medical records, officials said.

Hospitals could receive between about $2 million and $12 million in incentive payments, and individual clinicians are eligible for $44,000 through Medicare and $63,750 through Medicaid.

The rules defer requirements until the second stage of the program, enabling more hospitals and doctors to receive incentive payments at the start of the program. Stage one is voluntary, but providers will face reductions in Medicare payments if they do not conform to meaningful use standards by 2015. There are no penalties under Medicaid. There are fewer details for the third stage, ONC Director David Blumenthal said, because the Medicare and Medicaid programs will have changed significantly by then so HHS is holding off with details until later when it has a better handle on what those changes mean to EHR adoption.

Tuesday’s announcement focuses on the first stage of the goals of the HITECH Act, which begins in 2011. Much of the criticism of the proposed rule was based on the provision that health care professionals had to meet 25 requirements to qualify for meaningful use. Stakeholders told HHS that the list of requirements was too demanding and inflexible so in the first stage, HHS is making providers meet 15 “core” requirements, with a “menu” of 10 objectives from which providers must meet five.

During the public comment period, many stakeholders voiced concerns that the electronic tools currently on the market were not capable of recording what CMS was requiring providers to record. In response, CMS is only requiring reporting on clinical quality measures that currently have electronic specifications.

Some of the objectives were also modified. For instance, doctors must transfer 40 percent of prescriptions electronically, compared with the earlier proposed threshold of 75 percent. “This is a realistic, but still ambitious, set of objectives,” Blumenthal said.

Blumenthal said hospitals have urged HHS to define hospitals by CCN for other policies and programs so it should apply to the health IT payments, too. “[T]hat is most consistent with policy precedents in how Medicare has historically applied the statutory definition of a ’subsection (d)’ hospital under other hospital payment regulations,” CMS states.

The Federation of American Hospitals, which supports the rules, listed the multiple-campus wrinkle as one that needs ironing out. “[T]he Congressional framers of HITECH clearly intended that its financial incentives flow to all qualifying hospitals,” FAH states in a release. “But under today’s final rule, multiple hospitals under a single Medicare provider number will not receive their full allotments.”

The American Hospital Association also said the rules raise concerns. “The promise and intent of Congress and the president was to provide needed funding to hospitals and physicians with the goal of spurring adoption of EHRs,” AHA President Rich Umbdenstock said. “Hospitals strongly share that goal, but today’s rule raises some serious concerns and needs to be further evaluated to determine its impact on hospitals and the communities they serve.”

HHS officials said the “meaningful use” payment is a way to help providers with the largest hurdle to the adoption of electronic health records: the cost of the equipment. But some physician advocacy groups still say the adoption of electronic health records is cost-prohibitive.

“Physicians recognize the potential for health IT and want to adopt new technologies, but costly records systems are out of reach for many physicians because of low Medicare payments and the prospect of steep cuts in December,” AMA Board Member Steven Stack said. “Congress needs to repeal the flawed Medicare physician payment formula to help eliminate one major obstacle to the physician adoption of new technologies.”

Pharmacy benefit managers (PBMs) largely praised the rules, however suggested that CMS could do more to safegaurd patients in the future. The Pharmaceutical Care Management Association urged CMS to do “more down the road” to shore up the e-prescribing provisions of the rule.

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