While the time is right for practices to seize the opportunity to get federal money for health IT, many details that will affect incentive payments are still being fine-tuned.

Everyone in healthcare is lining up to get their share of the nearly $20 billion within the American Recovery & Reinvestment Act of 2009 (ARRA) that the government has earmarked for incentives to adopt electronic health records (EHRs). These health IT incentives, as well as state loan programs, will be available for five years, beginning in 2011 (see table), and are available per physician once they adopt and use “certified” EHRs in a “meaningful” way—terms yet to be defined by the government, although it held its first meeting on the subject in late April.

But be forewarned—if you don’t adopt prior to 2014, you could be hit with payment penalties in 2015 that increase with each subsequent year. Additionally if the department of Health and Human Services (HHS) determines that healthcare overall hasn’t adopted enough certified EHRs or demonstrated meaningful use, it can further reduce the Medicare fee schedule payments—first to 96 percent and then 95 percent in subsequent years. Penalties however, may not be increased beyond 5 percent.

Certification speed bump

While the government has not announced which organization will certify EHRs, many say it will be the Certification Commission for Healthcare Information Technology (CCHIT). “Certification is a grey area, and one of the most important in terms of physician adoption,” says Robert Tennant, senior policy advisor at the Medical Group Management Association (MGMA).

How the certification will work is unclear. For instance, if a product is certified in 2006 but not in 2009, will it meet the government’s requirements for certification? In addition, certification for products deemed certifiable in 2007-2008 is good for two years; however, subsequent certification requirements will be tougher to meet. More than likely, says Tennant, to be eligible for the incentive money starting in 2011, physicians will have to have a product that was certified in 2010. Whether vendors will have to re-certify their products every year remains to be seen. 

Getting an EHR certified is not a trivial task, and smaller vendors could miss out if they haven’t been certified—presumably by CCHIT—by 2011. CCHIT reported a 33 percent increase in EHR applications for 2008 compared to 2007. Nearly 40 percent of them were first-time applicants, and more than 60 percent of the applicants reported revenues of $10 million or less, which qualifies them as small businesses. “The prevalence of smaller vendors and new entrants continues to refute speculation that certification could be a barrier to small companies,” says Mark Leavitt, MD, chair of CCHIT.

EHR/PM software disconnect

As outlined in the yet-to-be-finalized definition of meaningful use, EHRs must be capable of quality reporting, which brings practice management software to the forefront when considering an EHR purchase.

Interoperability is a key consideration for personal health records, but also for practice management software. Do practices need to purchase separate practice management systems in combination with their EHR? What if they have a practice management system but not an EHR? “The main consideration is for the two software applications to be able to talk to each other,” says Charles Jarvis, assistant vice president of healthcare industry services and government relations at NextGen Healthcare Information Systems. “As straight billing continues to be further ratcheted down, the need for the billing system to appropriately code and capture every available dollar going forward is essential,” Jarvis says.




James E. Tcheng, MD, vice chair of the American College of Cardiology’s (ACC) informatics committee, cautions against purchasing a practice management solution and a separate EHR and then trying to wed the two. He says it would probably cost more than purchasing an integrated solution. He also suggests that physicians assess their business and clinical needs and consider what solution will serve them best in 2014, not just next year.

In terms of the Physician Quality Reporting Initiative (PQRI), a well-developed EHR will handle that process automatically as part of its documentation processes. But Tcheng speculates that the driver for the stimulus, or the definition of “meaningful use,” will not be quality reporting per se.

“I imagine the ONC [Office of the National Coordinator for Health Information Technology] will require evidence that an EHR is the tool you use to document and manage patients seen in the practice,” he says, adding that meaningful use could potentially combine the components of e-prescribing, patients encounter documentation to generate bills, as well as quality reporting.

Start planning now

Multiple organizations like the ACC, the American Medical Association (AMA) and the American College of Physicians have published toolkits to help physicians and practices assess the EHR market. “It is interesting that during this economic drag, funds are allocated to purchasing EHRs, but for the long-term future—decades and even centuries—this is a key turning point for us,” Tcheng says.

Jarvis concurs but adds that a great deal of work—across the industry—remains to be done before practices can reap the financial incentives in 2011. “All health IT providers play an important role to help implement this program effectively,” Jarvis says. “We have a responsibility to ensure it is done right, and the health IT community has a responsibility to provide a reasonably priced product with all of the associated costs clearly identified and to make sure everyone is properly educated—because this opportunity is not going to come again.”  

Extra Perks from Practice Management Systems

Besides the obvious functions like scheduling and billing, practice management systems offer several unique ways to capture potentially lost revenue. Here are some examples available with the practice management program from NextGen Healthcare Information Solutions. Payor contracts can be loaded into the system and if anyone underpays by as little as $1, the system will send an alert to the appropriate claims specialist. Each payor has its own payment schedule. These can be programmed into the system and if the payment isn’t received by the appropriate date, the system will send out an email to the payor. Rather than wait for monthly reports to catch such glitches, practices can take immediate action and reduce the number of days for accounts receivable. The PM system has built in all the CCI (correct coding initiative) edits. All the “claims scrubbing” is done in the system, bypassing the clearinghouse at a considerable savings. First-pass claim rate averages 97 percent, compared to an industry average of 70 percent, according to NextGen.

What is ‘Meaningful Use’?

The Department of Health and Human Services (HHS) intends to determine the criteria for “meaningful use” regarding EHRs by the end of the year, but in general, it is accepted to mean: Physicians must use a certified EHR system that includes electronic prescribing capabilities with final certification standards determined by HHS; The EHR must demonstrate interconnectivity and exchange personal health information with other providers; and The EHR must submit quality data measures.