Disclaimer: The content of this Q&A is for general information purposes only and does not constitute advice. ALN strives to provide content that is true and accurate as of the date of writing; however, we give no assurance or warranty regarding the accuracy, timeliness, or applicability of any of the contents. The HITECH Act is in the early stages and information is being updated and clarified daily. ALN will continue to update information as it becomes available.

1. What is the American Recovery and Reinvestment Act of 2009?

The American Recovery and Reinvestment Act of 2009 (ARRA) is a spending bill enacted by the 111th United States Congress and signed into law by President Barack Obama on February 17, 2009. The Act of Congress was based largely on proposals made by President Obama and is intended to provide a stimulus to the U.S. economy in the wake of the economic downturn. The Act includes federal tax cuts, expansion of unemployment benefits and other social welfare provisions, and domestic spending in education, healthcare, and infrastructure, including the energy sector.

2. What is the HITECH Act?

"The Health Information Technology for Economic and Clinical Health" or HITECH
This bill proposes to accomplish four major goals that advance the use of health information technology (Health IT), such as electronic health records by:

• Requiring the government to take a leadership role to develop standards (by 2010) that allow for the nationwide electronic exchange and use of health information to improve quality and coordination of care.
• Investing $19.2 billion in health information technology infrastructure and Medicare and Medicaid incentives to encourage doctors and hospitals to use HIT to electronically exchange patients‘ health information. Note: the final rule of Meaningful Use Stage One revised the estimated investment, bringing this number to nearly $30 billion.
• Saving the government $10 billion, and generating additional savings throughout the health sector, through improvements in quality of care and care coordination, and reductions in medical errors and duplicative care.
• Strengthening Federal privacy and security law to protect identifiable health information from misuse as the health care sector increases use of Health IT.
  

3. What is the main objective of the HITECH Act?

The main objectives of the legislation are to create and expand the current U.S. healthcare IT infrastructure, promote electronic data exchange, and substantially and rapidly increase EHR adoption to 90 percent for physicians and 70 percent for hospitals by 2019.

4. How is the $19.2 billion for the HITECH Act allocated?

In 2009, the HITECH Act stated that approximately $22 billion will be spent between 2009 and 2013 by the Secretary of Health & Human Services (HHS Secretary) through the Office of the National Coordinator for Health IT (ONC). $19.2 Billion of this is intended to be used to increase the use of EHRs by physicians and hospitals. This money, focused on creating an HIT infrastructure, will be used to support ONC policy and standards efforts, "immediate funding" through federal agencies, grants to states, a state loan program for provider EHR purchase, training, and technical support.

In addition, the federal government projects that it will spend a net amount of $17.2 billion for Medicare and Medicaid incentives that will be available to providers, (physicians, and hospitals) meeting specified criteria.

Most recently, the final rule of Meaningful Use, Stage One, stated that this number has risen to nearly $30 billion.

5. What kinds of organizations will benefit from the HITECH Act? 

Financial incentives are being offered, in the form of government incentive payments to those who comply with emerging regulations of the HITECH Act. The incentives primarily benefit hospitals and office-based physicians who qualify as ‘Eligible Professionals’ (EPs). They are designed to reduce healthcare costs by accelerating the use of IT to improve quality, safety and efficiency. Ultimately, patients and caregivers also will benefit from the automation and connectivity enabled by EHRs.

6. What is the potential financial benefit of the healthcare IT incentives?

Each Eligible Professional (EP) who meaningfully uses a certified EHR could receive up to $44,000 (Medicare) or $63,750 (Medicaid) in government funding. EPs practicing in rural or underserved areas would be eligible for up to $48,400 in Medicare incentives. It‘s important to note that these figures represent the maximum allowable incentives under the Medicare and Medicaid programs, and that physicians may only qualify for either the Medicare or the Medicaid funding, but cannot qualify for both.

Medicare reimbursement will start in 2011; physicians are eligible to receive Medicare incentive payments for being a "meaningful user of a certified EHR". These incentive payments are calculated on a per physician basis. The proposed payments are greatest in the first year, decreasing in amount for the following four years or until 2016. Medicare incentives are calculated at 75% of allowable charges up to a maximum $44,000 over 5 years. 

 

Medicaid reimbursement will be managed at the State level, which will institute the guidelines provided by HHS. Much of the basic qualifications are similar, e.g., meaningful use of certified EHR, but other aspects diverge significantly. 

Qualification differences from those of Medicare reimbursement:

• Physicians must demonstrate that minimum Medicaid patient volume thresholds are met to qualify as an EP. The threshold is: 30% or more patients are covered by Medicaid (20% or more for pediatricians). The Medicaid patient volume threshold calculation will be determined by each state’s Medicaid Agency and be approved by CMS.
• EPs who adopt, implement, or upgrade (AIU) in the first year of participation may be eligible for the incentives. In second and subsequent years, they must demonstrate Meaningful Use to continue receiving payments.
• There is an extended time horizon for Medicaid payments - through 2021.

7. What requirements must be met to qualify for incentive payments?

There are three requirements that must be met to qualify for incentive payments. First, you must be an ‘Eligible Professional’ EP. AMA has defined a set of qualification guidelines for both Medicare and Medicaid. Second, you must adopt EHR software that is certified to the 2011 standards set forth by the ONC. And finally, you must demonstrate Meaningful Use. The objective, measures, and exclusions for stage one have been finalized by CMS. Stages Two and Three will be defined in the coming years. Click here for more details regarding reimbursement requirements. 

8. Who qualifies for the HITECH Act?

"Eligible professionals" (EPs)under the Medicare HIT incentive program are defined as doctors of medicine or osteopathy, dentists or dental surgeons, podiatrists, optometrists, or chiropractors.

The Medicaid HIT Incentive program expands the definition of ‘eligible professionals’ to include certified nurse mid-wives, nurse practitioners and physician assistants who practice in a Federally Qualified Health Center or rural health clinic that is led by a physician assistant.

Hospital-based professionals are not eligible for incentive payments under either the Medicare or Medicaid programs. Hospital-based professionals would include, e.g., pathologists, anesthesiologists, or emergency physicians who furnish substantially all of his/her services in a hospital setting (either inpatient or outpatient). The rationale for this exclusion is that those professionals would be expected to use the hospital‘s EHR.  Hospitals are entitled to a separate set of incentive payments under the law. The determination of whether a professional is hospital-based or not will focus on the setting in which the provider furnishes services rather than any billing or employment arrangements between the provider and the hospital or other provider entity.

9. Who qualifies for the additional 10% rural health incentive for office-based physicians?

An ‘Eligible Professional’ who predominantly furnishes services in a geographic area that is designated by the HHS Secretary as a health professional shortage area may receive a10% increase in their annual payment. Click here to see if you are operating in a designated Health Professional Shortage Area (HPSA).

HPSA physicians may also be exempt from late adoption penalties. The Secretary of HHS has the authority to make exceptions to penalties on a case-by-case basis for physicians who demonstrate significant hardship (e.g., a physician who practices in rural areas without sufficient Internet access).

10. What is “Certified EHR technology,” as defined within the bill?

ONC has issued standards and certification criteria for electronic health records. ‘Certified EHR technology’ means that the EHR is capable of supporting the specific tasks that are required under Stage One of Meaningful Use. Click here for a list of all certified EHR technologies.

11. Which organizations are authorized certification bodies by the ONC?

As of December, 2010, The ONC has selected three Authorized Testing and Certification Bodies (ATCB). All three organizations were authorized in September, 2010, and are certified to authorize complete EHR and EHR Modules.

• Certification Commission for Health Information Technology (CCHIT)
• Drummond Group, Inc (DGI)
• InfoGard Laboratories, Inc

· 1112. Does the HITECH Act require our practice to purchase a certified EHR?

Yes – The Act makes it very clear you must purchase a certified EHR.

Certification Issue

While nearly 100 EHRs are currently ONC-ATCB 2011/2012 certified, it is still possible that the model you use, or are about to use, is not certified.

Action steps

• If you are a current EHR user, discuss this issue with your vendor; determine when they will be certified or re-certified; add stipulation that they will meet appropriate level of certification to your contract.
• If you are a prospective purchaser, put this issue at the top of your list of questions; stipulate appropriate certification in negotiations/contract.
• To ensure you are using/ are about to purchase a certified technology, view the ONC-ATCB Certified EHR Technology list.

13. What about vendors who are saying don’t worry about the certification?

Many practices have been told, 'Don‘t worry about it; our system is just as good as one that‘s certified.’ However, to now qualify for HITECH incentive and avoid penalties, your EHR must be certified to the ONC-ATCB certification standards. Double check that the EHRs you are considering are on the certified list. 

14. What is meant by “Meaningful Use” of healthcare IT?

‘Meaningful Use’ means that you not only have certified EHR technology but that you actually use it for its intended use. To ensure that practices are doing just that, the HITECH Act has drawn up a set of requirements for meeting Stage One of Meaningful Use. This list includes a Core Set of objectives that must be met by all EPs, as well as a Menu Set of objectives from which EPs may select from a pre-determined list of objectives that they will attempt to satisfy. Click here for more information, including a complete list of the core and menu set objectives, as well as each objective’s measure, exclusions, and method of reporting.

An ‘Eligible Professional’ shall be treated as a meaningful EHR user for a reporting period for one payment year if the following requirements are met:

• Meaningful use of certified EHR technology. The EP demonstrates to the satisfaction of the HHS Secretary, that during such period the physician is using certified EHR technology in a meaningful manner, as set forth by the three stages of meaningful use.
• Information exchange. The EP demonstrates to the satisfaction of the HHS Secretary that during such period such certified EHR technology is connected in a manner that provides, in accordance with law and standards applicable to the exchange of information, for the electronic exchange of health information to improve the quality of health care, such as promoting care coordination.
• Reporting of measures using EHR. Using such certified EHR technology, the EP submits information for such period, in a form and manner specified by the HHS Secretary, on such clinical quality measures and such other measures as selected by the HHS Secretary. The HHS Secretary shall seek to improve the use of EHRs and healthcare quality over time by requiring more stringent measures of meaningful use selected under this paragraph.Click here for more on Meaningful Use requirements and Clinical Quality Measures. 

15. What are the overall objectives of meaningful use?

The MU objectives, as defined by CMS and the basis for ‘Eligible Professionals’ (EPs) to receive HITECH incentive payments, are based on five stated goals.

1. To improve the quality, safety, and efficiency of care while reducing disparities
2. To engage patients and families in their care
3. To promote public and population health
4.  To improve care coordination
5. To promote the privacy and security of EHRs

The goal of Stage One is to begin electronically capturing health information in a structured format. This consists of electronically capturing basic information essential to creating any medical record, as well as beginning to utilize the interactive value of the EHR. Specific goals for Stage Two and Stage Three are still being determined.

16. What are the meaningful use objectives that I must meet?

Meaningful Use objectives for Stage One have been divided into two segments: the Core Set and the Menu Set.

The Core Set consists of 15 objectives that represent tasks that are essential to creating any medical record. Such objectives include the entry of the patients’ vital signs, demographics, active medication use, allergies, an up-to-date problem list, current and active diagnoses, and smoking status.

The Menu Set consists of 10 additional objectives, of which the eligible professional must choose 5 to meet and report on. Such objectives include drug formulary checks, incorporating laboratory results into EHRs, providing reminders to patients for needed care, identifying and providing patient specific health education resources, and employing EHRs to support the patient’s transactions between care settings or personnel.

Click here to view the full list of the Menu and Core Set objectives, measures, exclusions, and reporting methods. 

17. How do I know if I should participate with Medicare or Medicaid?

‘Eligible Professionals’ who qualify for both Medicare and Medicaid incentives are only able to participate in one of the programs; however, they will have one opportunity to switch programs after receiving the first incentive payment prior to 2015. Click here to learn more about Medicare and Medicaid reimbursement eligibility or contact ALN today to discuss possible options with one of our experts.

18. What about Medicare Advantage?

The Act provides for comparable incentives and disincentives for professionals providing substantial services through Medicare Advantage plans. These services must be provided to at least 80 percent of the organizations clients and include a minimum of 20 hours a week of patient care per eligible professional. Medicare Advantage Organizations (MAO) provide incentive payments in a slightly different manner than HITECH Act's Medicare and Medicaid reimbursements so be sure to contact a MAO representative for specific details.

19. When will the final regulations come out?

The final regulations for Stage One of Meaningful Use were released in July of 2010. Stages Two and Three are expected to be released gradually over the coming years. The last year to qualify for government incentives is 2016 so all three stages are expected to be released by then but no one knows for sure when the final regulations will be released.

20. What is the qualification process that I must follow in order to receive government incentives?

There are three requirements that must be met to qualify for incentive payments. First, you must be an ‘Eligible Professional’.  Second, you must adopt EHR software that is certified to the 2011 standards set forth by the ONC. And finally, you must demonstrate Meaningful Use. For details, Click here or contact an ALN representative to begin a personal discussion.

21. What reporting requirements must I follow to receive government incentives?

Under the Medicare program, EPs must report on meaningful use objectives annually. The annual schedule begins with 90 days of reporting in 2011 and entire calendar year reporting in subsequent years.

Under the Medicaid program, EPs must report for entire calendar years, however for year one, EPs must only prove that they have met the AIU requirements: Adopt, Install, or Upgrade.

In addition to reporting on Core and Menu Set objectives, providers must also report on clinical quality measures. CMS defines clinical quality measures as “measures of processes, experience, and/or outcomes of patient care, observations or treatment that relate to one or more of the Institute of Medicine domains of health care quality (e.g., effective, safe, efficient, patient-centered, equitable and timely).”

Providers must report on clinical quality measures to demonstrate meaningful use. Using an attestation methodology, EPs must submit information on three core measures and three additional measures chosen by the provider. Click here to view all of these measures.

There will be no reporting penalties in Stage One as long as the EP has adopted a certified EHR, the EHR calculates, and the EP submits the required clinical quality information. In future stages, reporting timeframes are expected to be aligned across all CMS programs. A goal has also been set to integrate the EHR incentive program and the PQRI by January 1, 2012.

22. What must I report on to receive incentives? 

You must report on the Meaningful Use Core Set and Menu Set objectives, as well as Clinical Quality Measures. (see Q 14 and Q 20)

23. When are the payment periods associated with the incentives?

Medicare payments will begin in 2011 and continue throughout 2016. Payments are based on continuous meaningful use reporting. As the chart illustrates below EPs under the Medicare program can receive a maximum of $44,000 in government incentives, however that number decreases significantly the long an EP waits to qualify.

Medicaid payments also begin in 2011, however, unlike Medicare payments, Medicaid EPs may qualify for payments over a six year period. In addition, the last year to qualify for Medicaid incentives is 2016, that’s two years later than qualification deadline for the Medicare program.

See Q6 for charts illustrating the payment periods.

24. What is the financial impact if I start early? What if I wait?  -What are the penalties if healthcare providers do not implement an appropriate amount of technology and report quality data by 2015?

The sooner you start the better your chances to meet the timelines required in the HITECH Act. For many organizations this will be a very tight window; there is a lot you need to accomplish to qualify. System selection, change management, contracting, etc are just a few of the critical path items. You don‘t just drop in an EHR system; it is complicated and will affect your entire practice. There are interfaces, data migration, and a lot of challenges to overcome prior to qualifying for "meaningful use".

Under the Medicare program, office-based physicians are rewarded for early adoption. EPs who qualify in 2011 and 2012 will receive the maximum incentive amount of $44,000. On the other hand, late-adopters, those who qualify during 2013 and 2014 will receive a much lower incentive, $39,000 and $24,000 respectively. Anyone qualifying in 2015 or later will receive no incentive payments. Furthermore, those who do not qualify at all will start receiving penalties in 2015 of 1% and greater of their billable Medicare fees. These practices will also miss any opportunity for PQRI and eRX bonuses. The dollars add up quick for a practice with a substantial sum of collections coming from Medicare.

Neither a benefit nor a penalty exists for office-based physicians under the Medicaid incentive program. Any EP who qualifies between 2011 and 2016 will receive the full incentive amount of $63,750.

We recommend starting the process now. Most analysts believe this is going to be a little bit like Y2K, when you're going to have every practice in the country calling up their vendors, calling up their lawyers, calling up their consultants and saying, 'We need you in here next week.‘ Don’t wait until the last minute to begin this process. . Besides having the normal lag time, there will then be so much demand on vendors and IT people that it‘s going to be difficult to actually get these systems implemented in time to take advantage of the programs.

25. Will the incentives be applied to systems already in use, or will they be applied to the purchase of new systems only?

The incentives are available to meaningful users of certified IT systems described in the legislation regardless of when they were implemented. The qualifier is the date at which the EP can demonstrate ‘Meaningful Use’ of the certified technology. If you already have a system in place, you will likely need to upgrade your current platform to one that is certified and capable of meeting meaningful use requirements.

If you are not satisfied with the EHR you are currently using, this may be a good time to consider changing your EHR provider. Remember, switching from one EHR to another is much cheaper and easier than your initial EHR adoption and finding the EHR that is right for you practice is priceless in the long run.

26. What % of physicians are using EHR today?

According to the 2010 Physicians Practice Technology Survey (August 2010), about 40% of office-based physicians are already using fully integrated EHR systems. Nearly 57% of the survey’s respondents indicated that they were more likely to purchase an EHR now that the federal government is offering economic incentives, leading us to believe that the percentage of physicians using an EHR will increase dramatically over the next year or two.

27. How will the Privacy and Security section of the HITECH Act impact hospitals and healthcare providers?

The stimulus bill increases regulatory requirements by expanding the privacy and security provisions and penalties to business associates within the Health Insurance Portability and Accessibility Act (HIPAA). The new language requires covered entities to notify patients of a security breach, and requires vendors that have access to patient health information (PHI) to enter into a Business Associate Agreement.

Requirements include:

• Provide patients with a report of all disclosures made through the EHR, from three years of the request (compliance dates vary depending on date of EHR adoption); 
• Comply with a patient’s request to withhold PHI from a health plan if the patient is self-pay; 
• Limit the disclosure of PHI to a limited data set, or to the minimum necessary to fulfill an intended purpose (as defined under HIPAA); 
• Obtain patient authorization, before using PHI for marketing purposes and receiving payment; 
• Employees and other individuals who access, use, or disclose PHI without authorization shall be subject to criminal penalties; and
• Civil penalties for violations under HIPAA vary (a tiered approach) depending on the specific conduct.