Enacted on February 17, 2009, the American Recovery and Reinvestment Act (ARRA) under the Health Information for Economic and Clinical Health Act (HITECH) provision established incentive payments for eligible professionals (EP) and eligible hospitals that meaningfully use EHRs. On July 28, 2010 the Centers for Medicare and Medicaid Services (CMS) released the final rule for the Medicare and Medicaid Electronic Health Records (EHR) Incentive Program and the Office of the National Coordinator of Health Information Technology (ONC) released the final rule on the specification and certification criteria for EHRs to provide the final criteria EPs and eligible hospitals must meet to demonstrate that they are meaningful users of EHR.
The Academy’s recommendations and Changes from the Proposed to the Final Rule
In our comment letter to CMS regarding the proposed rule, although we supported the benefits of adopting EHR to improve health outcomes and the overall quality of care, we addressed some concerns to CMS:
We opposed the “all or nothing” approach that the agency proposed for EPs to obtain incentives. Rather, we supported a more gradual process to encourage EPs to adopt EHRs.
Changes Made in the Final Rule
In the final rule, due to our advocacy CMS reduced the total number of objectives that EPs must satisfy to show meaningful use. Also, they decreased the threshold levels for clinical quality measures, established two sets of objectives – core and menu (there are 15 core objectives that EPs must report and EPs may select 5 out of 10 menu objective to report) and will allow EPs to be excluded from reporting measures that don’t apply to them. In these cases, CMS will allow the EPs attest that the measures don’t apply to them. CMS reduced the clinical decision support rules from five to one and reduced the clinical quality measures from 90 to 44. Also, they removed the requirement of reporting specialty group measures.
Things that Didn’t Change
What do the Stages Entail?
The CMS finalizes its plan to phase the “meaningful use” (MU) criteria in three incremental stages. However, the agency only finalized the MU requirements under stage 1 for 2011 and 2012. CMS plans to expand the stage 1 criteria and include them into the subsequent stages. The agency will update the meaningful use criteria on in future rule makings and the current MU criteria will be valid until future proposals are made.
Meaningful Use for EPs who Work at Multiple Sites
According to CMS, EPs that work at multiple locations and do not have Certified EHRs (CEHR) at all of these locations need to have at least 50% of all their patient encounters at sites that have CEHR. In this case, CMS will only base their MU on encounters that occurred in these areas.
Clinical Quality Measures (Applies to Medicare and Medicaid Eligible Professionals (EPs))
To fulfill the meaningful use criteria for the 2011 Payment Year (PY), EPs must submit (to CMS) required clinical quality data with an attestation that they used certified EHRs to collect the data elements, calculate the results and vouch for the accuracy and completeness of the data they submitted. EPs are required to submit the numerators, denominators, and exclusions for the required measures for all applicable patients (not just Medicare and Medicaid patients). For the 2012 PY, EPs may start reporting the required data on quality measures electronically via a CMS designated portal. Beyond 2012, CMS plans to test (and possibly adopt) submission through Health Information Exchange/ Health Information Organizations or through registries. The agency plans to announce the technical requirements for electronic submission on or before July 1, 2011 for Medicare EPs.
Measures Required for 2011 and 2012
For the 2011 and 2012 EHR reporting periods, CMS requires each EP to submit information on six measures from the 44 clinical quality measures: three core and three additional measures. If the denominator for one or more of the core measures is zero, CMS requires the EP to report results for up to three alternate core measures. If all 6 of the core measures have a denominator of zero, CMS requires EPs to report on 3 measures selected from the 38 measures that are not identified as core measures or alternate core measures. In addition to reporting the core measures, CMS requires that EPs report on three additional clinical measures. To be exempt from reporting these measures, EPs must attest that all of the other clinical measures calculated by the certified EHR have a value of zero for the denominator.
Measures beyond 2013
CMS stipulates that the number of measures for EPs to report on will increase by 2013 and that they will consider measures from the 2010 PQRI program.
To view the clinical quality measures for the EHR incentive programs, please visit
The Medicare EHR Incentive Program
The EHR reporting period may be “any continuous 90-day period within the first payment year and the entire payment year for all subsequent payment years.” The Medicare EHR Incentive program will be consecutive i.e. CMS will treat every year following the first payment year (PY) as a PY whether the EP received an incentive payment or not. The first PY for the program is Calendar Year (CY) 2011. For EPs who change practices during the reporting period, they may still be eligible for IPs since these are contingent on the EP’s ability to demonstrate meaningful use. To demonstrate meaningful use EPs must show that they meet the entire 15 core set objectives and their associate measures for stage 1. For some measures, EPs that don’t have any patients that meet the criteria may be excluded from reporting these measures. According to CMS, “each objective must be satisfied by an individual EP as determined by unique National Provider Identifiers (NPIs). CMS plans to convert every measure in the menu set in stage 1 to the core set for stage 2 and to increase the thresholds for stage 1 as the program advances to the second and third stages.
Incentive Payments (IPs)
EPs who are meaningful EHR users during the relevant EHR reporting period are entitled to an incentive payment amount, subject to an annual limit, equal to 75 percent of the Secretary’s estimate of the Medicare allowed charges for covered professional services furnished by the EP during the relevant PY. EPs are eligible for IPs for up to five years. There won’t be any IPs after 2016 for the Medicare program. The last year to begin participation is 2014. The first IP will be made in 2011. CMS plans to make a single consolidated IP to EPs yearly. CMS will not allow EPs to reassign their benefits to more than one employer or entity to reduce any administrative burden and confusion. Hence, EPs are responsible for reimbursing any relevant parties or associates with IPs. The Medicare contractors will calculate the IPs for EPs and disburse them on a rolling basis. The IPs will be made through a single payment contractor with the Integrated Data Repository (IDR) accumulating the allowed charges for each qualified EP’s National Provider Identifier.
Payment Adjustments (penalties) for EPs who are not Meaningful Users of CEHR
There will be a one to five percent payment adjustment for EPs who are not meaningful CEHR users after 2015. EPs that are able to prove that they are undergoing “significant hardship” may be exempt from this payment adjustment (on a case by case basis reviewed by the CMS secretary). EPs that fall under this category would need to renew their status annually and will not be granted this status for more than five years.
How Can EPs Register?
Registration for the Medicare program will begin in January 2010 via the CMS website. CMS is requiring that each EP has an enrollment record in PECOS. If you do not have one, please visit.
The Medicaid EHR Incentive Program
The common definition for meaningful use (MU) will be the minimum standard for the Medicaid program. States may obtain approval from CMS to add more objectives to the MU definition. However, for CY 2011 and 2012, CMS will only consider states’ requests to modify the stage 1 objectives for public health or data registries. In the first year, EPs may obtain their incentives through upgrading, adopting, or implementing a CEHR (EPs would need to show proof of their installation rather than any efforts to install). If the EPs decide to go through this route, in their first year they won’t need to show meaningful use of EHRs. However, for subsequent payment years (PYs), they must demonstrate meaningful use of their EHRs. CMS finalizes that to be considered EPs for the Medicaid program, EPs must have at least 30% of their patient volume receive Medicaid over any continuous 90 day period within the most recent Calendar Year (CY) prior to reporting (exceptions to this rule, are for pediatricians who may have at least 20% or their patient volume receive Medicaid and Medicaid EPs who practices in predominantly FQHC or RHCs and “have a minimum or 30% patient volume attributable to needy individuals). EPs are not required to participate on a consecutive basis in the Medicaid EHR incentive program to obtain IPs.
Incentive Payments (IPs)
IPs for Medicaid EPs will equal 85% of “net average allowable costs” associated with adopting EHRs (these costs can vary by practice size, costs of licensing, support training and man power required). Hence, the maximum IPs that EPs can receive under this program is $63,750 over a 6 year period. IPs would be disbursed by states within the CY. If EPs practice in multiple states they will need to select one state Medicaid EHR incentive program to participate. There will not be any penalties for EPs who do not participate in this program.
To view the stage 1 meaningful use criteria, visit
For more information on the Medicare and Medicaid Incentive Programs, visit
Medicare and Medicaid Programs; Electronic Health Record Incentive Program; Final Rule. Accessed at http://edocket.access.gpo.gov/2010/pdf/2010-17207.pdf on August 10, 2010
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