Economic Stimulus Q&A

On February 17, 2009, President Obama signed into law the American Recovery and Reinvestment Act of 2009, otherwise known as H.R. 1 or the ARRA. The Act aims to stimulate the economy through investments in infrastructure, unemployment benefits, transportation, education, and healthcare. It includes more than $20 billion to aid the development of a robust IT infrastructure for healthcare and to assist providers and other entities in adopting and using healthcare IT.

Q: Where can I find the full text of the American Recovery and Reinvestment Act?
Q: What funding incentives are being offered through Medicare?
Q: Who qualifies as an eligible professional?
Q: What EHR technology qualifies as certified?
Q: Who qualifies as a meaningful user?
Q: Are any incentives provided through Medicaid and who is eligible?
Q: How much money in incentives is being offered through Medicaid?
Q: What is considered certified EHR technology under the Medicaid provisions?
Q: Are doctors eligible for both Medicare and Medicaid incentives?
Q: Can a physician be penalized for not utilizing an EHR by 2015?
Q: My group has 10 physicians. Could the group qualify for total incentive payments of $440,000 under the Medicare incentive program?
Q: My practice does not currently utilize an EHR. When is the right time to start planning for an EHR implementation?
Q: How will the EHR Stimulus payments actually be distributed to the physicians?

Q: Where can I find the full text of the American Recovery and Reinvestment Act?
A: The full text of the new law can be found at www.recovery.gov.

Q: What funding incentives are being offered through Medicare?
A: Eligible professionals who are meaningful users of certified EHR technology will receive incentive payments according to the following schedule:

Payment Year Incentive
First Payment Year $18,000 if the first payment year is 2011 or 2012
$15,000 if the first payment year is 2013
$12,000 if the first payment year is 2014

Second Payment Year $12,000
Third Payment Year $8,000
Fourth Payment Year $4,000
Fifth Payment Year $2,000

*For eligible professionals in a health professional shortage area (HPSA) the incentive payment amounts will be increased by 10%.
*Payments are not available to hospital-based professionals such as a pathologist, emergency room physician or anesthesiologist.

Technology must be in place in 2010 for doctors to be eligible for incentives in 2011.

Q: Who qualifies as an eligible professional?
A: The following types of providers fall under the definition of eligible professional:

  • M.D.
  • D.O.
  • D.D.S.
  • D.D.M.
  • D.P.M.
  • O.D.
  • Chiropractors

Q: What EHR technology qualifies as certified?
A: To be qualified as a certified EHR, the technology must include patient demographic and clinical health information such as medical history and problem lists, and have the capacity to provide clinical decision support that includes physician order entry (to capture and query information relevant to healthcare quality) and to exchange electronic health information with, and integrate such information from, other sources.

Q: Who qualifies as a meaningful user?
A: A meaningful user is an eligible professional who demonstrates:

  • Use of electronic prescribing functionality;
  • Their EHR is connected in a manner that provides for the electronic exchange of health information to improve the quality of healthcare; and
  • Submits information on clinical quality measures.

Q: Are any incentives provided through Medicaid and who is eligible?
A: Yes, the ARRA provides incentive payments for certified EHR technology by Medicaid providers. Providers eligible for funding are defined as:

  • A non-hospital-based professional with at least 30 percent of their patient volume coming from Medicaid patients.
  • A non-hospital-based pediatrician with at least 20 percent of his/her patient volume coming from Medicaid patients.
  • An eligible professional who practices predominately in a Federally-qualified health center or rural health clinic with at least 30 percent of the professional’s patient volume coming from Medicaid patients.
  • A children’s hospital, or an acute-care hospital, that has at least 10 percent of the hospital’s patient volume coming from Medicaid patients.

*Professionals in the first three bullets include: physicians, dentists, certified nurse midwives, and physicians assistants practicing in rural health clinics or federally-qualified health centers led by a physician assistant.

Q: How much money in incentives is being offered through Medicaid?
A: Medicaid payments are meant to cover costs for the purchase and initial implementation or upgrade of EHR technology and support services including training that is for, or is necessary for, the adoption and initial operation of such technology. First year payment (not to be made later than 2016) goes up to $25,000 and then five additional years of payments equal to $10,000 are included, but cannot exceed $64,000. Payments will stop after 2021.

Q: What is considered certified EHR technology under the Medicaid provisions?
A: To be qualified as a certified EHR, the technology must include patient demographic and clinical health information such as medical history and problem lists, and have the capacity to provide clinical decision support that includes physician order entry (to capture and query information relevant to healthcare quality) and to exchange electronic health information with, and integrate such information from, other sources.

Q: Are doctors eligible for both Medicare and Medicaid incentives?
A: No, they can only submit for one or the other – not both.

YFF Incent.
2011
Incent.
2012
Incent.
2013
Incent.
2014
Incent.
2015
Incent.
2016
Incent.
2017
Total
2011 $18,000 $12,000 $8,000 $4,000 $2,000 - - $44,000
2012 $18,000 $12,000 $8,000 $4,000 $2,000 - $44,000
2013 $15,000 $12,000 $8,000 $4,000 - $39,000
2014 $12,000 $8,000 $4,000 - $24,000
2015 -1% -1% MFS
2016 -1% -2% -3% MFS
2017 -1% -2% -3% -6% MFS

Q: Can a physician be penalized for not utilizing an EHR by 2015?
A: Beginning in 2015, physicians not demonstrating meaningful use of an EHR will face penalties in the form of reductions to their Medicare fees schedule reimbursement rates. The penalty will equal 1% in 2015, 2% in 2016, and 3% in 2017 and each subsequent year. Under the bill, the Secretary can increase the penalty to 5% if fewer than 75% of eligible physicians are not utilizing an EHR by 2018.

Q: My group has 10 physicians. Could the group qualify for total incentive payments of $440,000 under the Medicare incentive program?
A: Yes. If each of the physicians meets the criteria including the ability to demonstrate meaningful use of a certified EHR system by 2012, the group could be entitled to a total of $440,000 in incentive payments under the Medicare program.

Q: My practice does not currently utilize an EHR. When is the right time to start planning for an EHR implementation?
A: If you have not already started the process of implementing a system, the time to start the process is now. The transition to a new EHR system can be a timely process, especially with the added requirements of meeting the meaningful use criteria for the incentive payments. Typically, the time requirement of a successful EHR implementation increases in proportion to the size of the group.

Due to the fact that only 20% – 30% of the market has already implemented an EHR system and that many EHR vendors had waiting lists prior to the stimulus act, it will be a challenge for the industry to handle the implementation of the non-early adopters in a timely fashion. Those physician who wait, may have little chance of qualifying as an early adopter.

Q: How will the EHR Stimulus payments actually be distributed to the physicians?
A: The timing and distribution process for the incentive payments is to be determined and finalized by the Secretary of the HHS and the federal rule making process.