GE Healthcare Camden Group Insights Blog

CMS Reports that EHR Incentive Payments Top $12 billion

Posted by Matthew Smith on Mar 15, 2013 1:12:00 PM

EHR Incentive, Meaningful UseAs of the end of February 2013, an estimated $12.3 billion has been paid to 219,000 physicians and hospitals through the EHR Incentive Programs administered by the Centers for Medicare & Medicaid Services (CMS) since the programs' inception.

CMS will post final figures for February later this month as it captures more complete data, said Robert Anthony, a specialist in the agency's Office of eHealth Standards and Services, during a March 14 Health IT Policy Committee meeting, which was broadcast live. 

In February, 27,500 Medicare physicians received $425 million; 5,500 Medicaid clinicians and eligible professionals, $100 million; and 90 hospitals in either program, $200 million, for a total of $725 million to 33,090 providers.

“February was a big month, as we expected. A lot of Medicare eligible professionals came in and attested in the final month to be counted in the 2012 program,” Anthony said. “We expect that February number will continue to grow as we process them through the month. We’re already seeing some providers come in for 2013,” he added.
The incentive program has been operating long enough now that some providers are second-time participants, so CMS lists only unique providers paid. Since the program’s inception through February, CMS has paid 140,000 Medicare physicians, 75,500 Medicaid clinicians and 3,757 hospitals, according to latest estimates.
The number of eligible providers registered for the EHR incentive program was just shy of 85 percent of hospitals, and 73.2 percent of hospitals have been paid as of January.
“For eligible professions, two-thirds are registered and almost 40 percent have been paid under Medicare, Medicaid or Medicare Advantage,” Anthony said.
CMS also found that the performance level was comparable between providers attesting for the first time in 2011 or 2012 on their core and menu objective measures.
“We’re seeing consistently high performance. If anything, we see a slight increase as we move to a full year, but most is not statistically significant,” Anthony said.
However, there were indications that as providers move into a second year of meaningful use, “the workflow becomes more routine, and they are performing at a slightly higher level than when they began,” he said.

Topics: EHR, EMR, Meaningful Use, Health IT, Incentive Payment

How are Meaningful Use Incentive Payments Spent?

Posted by Matthew Smith on Feb 21, 2013 4:51:00 PM

The three-physician, four-nurse practitioner practice in Phoenix was building a new facility when the incentive program was announced, so by the time the checks arrived, the investments needed to bring the technology infrastructure to meaningful use readiness had already been made. But there was a community room in the new building that the group had envisioned as space for wellness classes. Together, they decided their meaningful use checks would go toward hiring a teacher to conduct weekly tai chi classes. They also made other small technology purchases to improve the existing IT.

The question of what to do with meaningful use money is one that every practice needs to discuss early on, as the Acacia practice did, before each physician goes through the attestation process. Being on the same page not only will help a practice achieve its goals, which very well could be contingent on everyone receiving the maximum incentive amount, but it also could prevent hurt feelings. In addition, it could avoid a lawsuit if a physician thinks he is entitled to pocketing money that the practice expects to keep.

“There are no guidelines in the statute in terms of how the money is spent,” said Michele Mann, principal at the technology consulting firm CSC. “So that really does, to some degree, become a business decision.”

It’s not unlike the questions associated with the money accountable care organizations receive, said Robert Williams, MD, director at Deloitte Consulting. ACOs operate under arrangements through which shared savings from providing efficient, quality care are distributed among participating parties. Some practices may reinvest those funds into the practice. Others may make the checks part of a physician’s compensation package.

Incentive Pay Decisions

Many practices decide on incentive pay by falling back on existing business arrangements that require all revenue generated by each employee or partner to be reassigned back to the practice. But because this is not normal, fee-for-service revenue, there may be confusion, especially because each physician is responsible for attesting to his or her achievement of meaningful use.

The program, which allows doctors to receive Medicare or Medicaid incentive money for demonstrating meaningful use of electronic health records, is based on paying individual doctors or other qualified practitioners, rather than the practice in total.

Although administrators may think it is clear that all incentive money will go back to the practice, having the conversation ahead of time can prevent sticky situations later.

Some practice partners feel confident enough in their relationship with fellow partners and employees that a verbal agreement is sufficient. But many experts agree that, whatever a practice decides, it should be put in writing.

“You are adding insult to injury, because you are asking them to do all of this — it’s not a lot of work, but it’s still work they have to do — and they are not recognizing the actual incentive money themselves, so it can clearly become a little contentious,” Mann said.

Danielle Sink, MD, one of the partners at Acacia Internal Medicine Specialists, said financial arrangements have always been clear among everyone involved. But the practice found itself in the middle of a lawsuit a few years ago, when a physician tried to challenge a decision about incentive pay. Dr. Sink said the practice prevailed in the lawsuit, but it was very time-consuming and costly to defend. The practice now puts everything in writing, and everyone involved in an arrangement is required to sign off.

Reassigning Versus Individual Bonuses

It’s very rare for full incentive checks to go back to individual physicians in a multidoctor practice, given the large practicewide investment necessary to meet meaningful use. But a practice also should ensure that things are handled fairly and equitably, especially for physicians who may have taken on more than the others.

Dr. Sink handled all the legwork involved with making sure the practice met meaningful use requirements and managing the decisions that were made with the money. Because these extra job responsibilities took time away from patient care, when the meaningful use checks arrived, the practice gave her some off the top as compensation.

A practice may decide to distribute the money to physicians as opposed to reinvesting in the practice. Mann recommends that the money be reassigned to the practice. Then the practice can use productivity as a relative percentage to determine who gets how much. “At the end of the day, the docs are the ones who are really having to use the system in a meaningful way to get the incentive money,” she said.

Michael Schrager, MD, managing partner of Central Coast Family Care, a nine-physician medical practice in Santa Maria, Calif., said all physicians at his practice are allowed to keep their bonus checks, but the “windfall” comes with a caveat.

The practice establishes goals it wants to meet each year, and the costs associated with reaching them are divided evenly among partners. If the doctors decide to spend meaningful use funds on themselves, they must come up with the agreed-upon investment amounts needed to reach the goals. The partners meet monthly to talk about upcoming projects and expenses. Every decision must be approved by each partner.

How to Spend the Money

Eric Finocchiaro, RPh, director at Deloitte Consulting, said for many practices the decision of what to do with the money was part of the decision to go after meaningful use in the first place. Doctors had to assign the incentive money into the budgets to achieve meaningful use.

For others, the bonus checks are a way to make necessary upgrades to the practice, or simply pay for the ongoing costs associated with converting to electronic records. Some of the more popular uses include:

Buying or replacing IT hardware/tools. Many early adopters of EHRs found themselves in need of new systems when meaningful use requirements were made clear. Others had to adopt EHRs for the first time. For many, those purchases were either financed or came out of capital budgets that needed to be replenished when the checks arrived.

Dr. Schrager and his partners decided not to take any chances on failing to meet the second of five stages of meaningful use, so they invested in software that monitors the practice’s readiness for all the objectives for the next stage. It shows them where improvements are needed and where a physician may be struggling.

“It’s important not to just spend the money,” he said. “If you are going to keep going in this project, the meaningful use criteria get more stringent, and the old ones don’t go away.”

Additional staff. The conversion to the electronic world may mean many hours of manpower to enter patient information, that previously lived in paper charts, into the EHR. Sumana Reddy, MD, owner of Acacia Family Medical Group, a four-physician practice in Salinas, Calif., said she decided not to let that burden fall on the physicians. She hired two temporary workers to input some of the data, including medication and problem lists, and an additional staff member to scan old records into the charts. That meant extra staff costs and a reduced patient volume while the doctors learned the new system. Had it not been for the meaningful use money, Dr. Reddy would have had to forgo pay for herself for a few months, something she has done a few times in the past. “This was not some huge gift,” she said.

Staff development. Dr. Schrager said his practice does not do direct bonuses to employees, but it will use some of the meaningful use money on improving morale through team building and staff development projects. They have developed a curriculum for support staff, for example, where employees can learn skills related to their areas of work.

New services. As many payers move toward outcome-based pay models, practices may want to consider using the money to offer wellness services such as smoking cessation and weight management classes. Dr. Sink said even though tai chi classes had nothing to do with EHRs, she and her partners believed it was a good use of the money because of the benefits to her elderly patients, especially those with arthritis.

Dr. Sink said she and her partners are always discussing ways to improve their practice. So far, they have not come up with an exciting way to spend their next round of meaningful use funds.

“But we’ll do the same kind of thing,” she said. “We don’t owe any debt, so we’ll save the money, and the things that come up that are appropriate, we’ll discuss it and then use it.”

Meaningful Use, Meaningful Use Incentives



Topics: EHR, EMR, Meaningful Use, CMS, Health IT, Electronic Health Record, Meaningful Use Attestation, Incentive Payment

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