As part of the American Recovery and Reinvestment Act, the U.S. government will invest more than $19 billion to modernize and accelerate the use of health information technology - particularly electronic health records (EHRs) - by hospitals and physicians
McKesson has been actively involved, meeting with members of President Obama's team before and after he took office, as well as with Congressional members and their staff. In Deccember, McKesson formalized its recommendations for healthcare IT investment in a white paper that was posted on the change.gov Web site. We are also active participants in a number of industry associations to coordinate and communicate the interests of McKesson and its customers. We will continue to closely monitor the progress of this legislation and the many details that will need to be worked through in the coming weeks and months.
The incentives primarily benefit hospitals and physicians. They are designed to reduce healthcare costs by accelerating the use of IT to improve quality, safety and efficiency. Patients and caregivers will also benefit from the automation and connectivity enabled by EHRs.
Each physician who meaningfully uses a certified EHR could receive up to $44,000 (Medicare) or $64,000 (Medicaid) in government funding. Physicians practicing in rural or underserved areas would be eligible for up to $48,400 in Medicare incentives. These figures represent the maximum allowable incentives under the Medicare and Medicaid programs. Many physicians will not qualify for the maximum amounts.
The total package includes $19 billion to accelerate EHRs and other IT adoption by physicians and hospitals. Funds become available for:
Customers should get started NOW to allow time to achieve meaningful use of certified solutions during this time period. While McKesson is focused on the applications and upgrades necessary to achieve meaningful use, qualifying for funding will require culture and process change within the physician's practice.
Physicians' maximum allowable Medicare incentive for the first year of meaningful use is increased $3,000, from $15,000 to $18,000, for demonstrated EHR use in 2011 or 2012. This "early adopter" incentive raises the total amount physicians can qualify for from $41,000 to $44,000. A benefit for early adoption does not exist under the Medicaid incentive program.
For physicians who do not adopt such technology by 2015, Medicare payments will be reduced by the following factors in the years specified:
"Eligible Professionals" under the Medicare HIT incentive program are limited to physicians as defined in the Social Secuirty Act (§1861(r)), which includes:
Although the incentives are not dependent on the eligible provider being a participating Medicare provider, the incentive amounts available to any provider is the lesser of 133% of their annual billed Medicare Part B charges or the maximum payment specified for the year in the regulations. (For example, a provider would have to bill $16,000 in Part B charges in order to qualify for a year in which the maximum allowable incentive payment is $12,000.) There are no distinctions between specialty and primary care physicians in terms of the incentives, EXCEPT hospital based physicians do not qualify for the physician incentives.
The legislation specifically states that hospital-based physicians DO NOT QUALIFY for the Medicare or Medicaid EHR incentives.
Certified nurse mid-wives, nurse practitioners and physician assistants will not qualify under the Medicare provisions. These providers, however, can receive Medicaid incentives provided that at least 30% of their patients receive medical assistance.