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Making Sense of the Medicare and Medicaid Incentives Packages: Eligibility and Funding Levels

Feb 15

Written by: Grants Office, LLC
Tuesday, February 15, 2011  RssIcon

By Chris LaPage
February 2011

Unless you have been hibernating in a cave for the past year, everyone connected to healthcare has been hearing the buzz words - Certified EHR Technology, Incentives, and Meaningful Use. The Medicare and Medicaid EHR Incentives were included in the American Recovery and Reinvestment Act of 2009, but registration just recently opened as payments will be dished out for the first time in 2011. Almost $20 billion is available to encourage the adoption of electronic health care records by health care providers across the United States.

The program was primarily designed to benefit individual practitioners (office or clinic setting) and hospitals. For the most part, long term care agencies and other types of providers will not benefit from the incentives. Acute care hospitals that have at least 10% Medicaid patient volume (children' hospitals have no volume threshold) will be eligible to receive incentive payments through both Medicare and Medicaid. Over $6 million in incentives are theoretically available to hospitals through the Medicare and Medicaid programs, but the actual amount pulled down will be based on discharge data, the relative number of Medicare/Medicaid inpatient bed days and the amount of charity care provided by the hospital.

Individual practitioners, on the other hand, must select only one program if they happen to be eligible for both. In order to be eligible for the Medicaid program, individual practitioners must meet a 30% volume threshold. If eligible physicians are duly eligible, the programs are set up so that the Medicaid program offers the larger incentive over the life of the program. Most practitioners will max out with the Medicare program at $44,000 in payments whereas Medicaid providers can receive up to $63,750 in incentives. In addition, in the first year of payment, practitioners receiving incentives through Medicaid will not be required to meet the definition of Meaningful Use. Medicaid providers only need to present evidence that they have adopted, implemented or upgraded EHR technology during the reporting period for their first-year payment.

Knowing the amount of money that can potentially be recouped through the incentive programs is only the first step. The Medicare program is open to physicians, dentists, podiatrists, optometrists, Chiropractors and acute care hospitals reimbursed under the prospective payment system. The Medicaid program is open to physicians, nurse practitioners, certified nurse midwives, dentists and certain types of physician assistants that meet the volume thresholds previously discussed. Assuming you are eligible, you must acquire a certified EHR unless you already have one in place. Either way, it must be certified by an Office of the National Coordinator - Authorized Testing and Certification Body (ONC-ATCB). Finally, you must demonstrate meaningful use of that EHR, which requires you to meet about 20 objectives and measures established by HHS. Registration for the Medicare/Medicaid Incentives started January 3, 2011. You do not have to have an EHR in place or demonstrate meaningful use to complete registration. It is recommended that you go ahead and complete the registration so that you are ready to realize payments once the EHR is adopted and you can prove meaningful use.

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