The Good, the Bad, and the Ugly of the EHR Meaningful Use and

Certification Final Rules:

What Hospital Leaders Should Know about the Medicare EHR Incentive

ProgramSeptember 9 and 10, 2010

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Background and OverviewBackground and Overview

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HITECH Act

HITECH Act created the Medicare and Medicaid EHR Incentive Programs

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•HITECH Act was a section of the 2009 Federal Stimulus Bill – the American Reinvestment and Recovery Act (ARRA).•HITECH Act directs the Centers for Medicare and Medicaid (CMS) and the Office of the National Coordinator for Health Information Technology (ONC) to promulgate regulations implementing the EHR Incentive Programs.

Meaningful use and EHR certification rules•Health care providers must be “meaningful users” of “certified” electronic health records in order to receive Medicare HIT incentive payments/not receive penalties.

Rulemaking

Proposed Meaningful Use and EHR Certification rules

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•Released in December 2009.•WHA and a number of Wisconsin hospitals submitted comments.

Final Meaningful use and EHR certification rules•Published in July 2010.•No comment period.

Major Changes to Final RuleMajor Changes to Final Rule Final Rule - July 2010

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Proposed Rule - December 2009

The Good…

Modified “all or nothing”

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•Proposed Rule – 23 requirements•Final Rule – 14 requirements PLUS choose 5 of 10 additional functionality requirements (1 public health related). Measures generally easier to meet.

CAHs now eligible for Medicaid EHR incentives

Exclusion for “hospital-based physician” narrowed•Congress passed legislation correcting language that excluded many physicians who work in hospital-owned clinics from receiving EHR incentives

Reduction in reporting burden•Certification rule now requires certified EHRs to automatically calculate the meaningful use measures.

The Bad…

Multi-campus hospital definition remains unchanged

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•Hospitals are defined by their provider number.

Introduction of non-EHR related policy

No long term plan•CMS declined to follow recommendations to set requirements through 2017.

•Measure - 10% of admitted patients are “provided patient-specific education resources.”

•Stage 2 begins as early as October 1, 2012. Stage 2 criteria “expected” by “end of 2011.” •Unclear if new criteria for FY2015 (penalty year) and beyond.

The Ugly.

Regulatory uncertainty will hinder hospitals’ ability to meet timelines

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•No certified EHRs currently exist; certifying bodies just announced.

Widespread adoption of EHRs?

•CMS believes additional $12K to CAHs (contingent on achieving MU) will lessen disparities.

•CMS estimate: As few as 32.1% of hospitals will get the maximum incentive.•CMS estimate: As many as 33.7% of hospitals will receive penalties.

•Ambiguity in regulations; CMS to provide additional guidance and explanation.•Unknown future stages.

CMS agrees that rural hospitals will have a more difficult time achieving MU

•Significant changes to existing EHRs needed to calculate quality measures.Hidden functionality requirements in quality measure requirements

WHA’s Early Advocacy Strategy

House Ways and Means Subcommittee

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•Letters to Reps. Kind and Ryan

D.C. visits

•Contacts with their offices

Multi-campus issue

Key ProvisionsKey Provisions

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Medicare Incentive Timelines

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First QualifyingYear Stage criteria EHs and EPs must meet in each payment year:

FFY2011

FFY2012

FFY2013

FFY2014

FFY 2015 and Beyond

FFY 2011 Stage 1 Stage 1 Stage 2 Stage 2 TBD

FFY 2012 Stage 1 Stage 1 Stage 2 TBD

FFY 2013 Stage 1 Stage 1 TBD

FFY 2014 Stage 1 TBD

FFY 2015 TBD

•Only 90 days of compliance must be shown in first payment year.•FFY begins October 1.

Medicare Incentive Timelines

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•Only 90 days of compliance must be shown in first payment year.•FFY begins October 1.

Incentive Payment Transition Factor for PPS Hospitals

Year hospital first qualifies

FFY2011

FFY2012

FFY2013

FFY2014

FFY2015

Year hospital meets MU and receives incentive payment

FFY 2011 100%

FFY 2012 75% 100%

FFY 2013 50% 75% 100%

FFY 2014 25% 50% 75% 75%

FFY 2015 25% 50% 50% 50%

FFY 2016 25% 25% 25%

Medicare Incentive Timelines

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Penalties if not adopting by FY 2015

FFY2015

FFY2016

FFY2017

PPS Hospitals - Three-quarters of the applicable market basket update is reduced by:

33.33% 66.66% 100%

CAHs – Allowable Medicare cost reimbursement percentage reduced to:

100.66% 100.33% 100.00%

•FFY begins October 1.

PPS Hospital Medicare Incentive Payment Formula

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Step 1: Calculate base dollar amount

($2 million + (your discharges from 1150 through and including 23,000)*200))

Example assuming 3,149 discharges (2,000 within eligible range):

$2 million + $400,000 = $2,400,000

Step 2: Calculate “Medicare Share”

Medicare inpatient days / (total inpatient days*((gross revenue – charity) / gross revenue))

Step 3: Multiply base by Medicare share

Using an example Medicare Share of .50: $2,400,000 X .50 = $1,200,000

Step 4: Determine payment for each year (Assuming 4 years of payments)

Payment Year 1: $1,200,000 (100%)Payment Year 2: $900,000 (75%)Payment Year 3: $600,000 (50%)Payment Year 4: $300,000 (25%)

CAH Medicare Incentive Payment Formula

•Design of Medicare EHR incentives allows CAHs to accelerate and increase the inpatient payment for depreciation of reasonable costs for purchase of depreciable assets such as computers and associated hardware and software, to support meaningful use of certified EHR technology

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•Reasonable costs can be depreciated in a single year, rather than over the life of the assets.•The costs of assets incurred in previous years that have not been fully depreciated may also be included.

•Medicare’s share of CAH EHR incentives is calculated the same as the PPS hospital EHR incentives plus 20 percentage points (not to exceed 100%).

•Basis for CAH Medicare EHR incentive payments is the reasonable cost reimbursement structure.

CAH Medicare Incentive Payment Formula

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Step 1: Calculate Cost of HIT Hypothetical:

FY 2011: $5 millionFY 2012: $5 millionFY 2013: $5 millionFY 2014: $5 million

Step 2: Calculate Medicare Share

(Medicare inpatient days / (total inpatient days*((gross revenue –charity) / gross revenue))) + 20%

Step 3: Multiply Cost by Medicare Share

Using an example Medicare Share of 50%, plus 20% bonus = 70% $20,000,000 X .70 = $14,000,000

Step 4: Calculate 101% of Medicare Share of Costs

Total Payment: 101% * $14,000,000 = $14,140,000

Medicaid EHR Incentive Program

Significant differences between the Medicare and Medicaid EHR Incentive Programs

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Focus of WHA’s September 21 webinar

•Only eligible for Medicaid Incentive Program if:• The hospital is a children’s hospital or• 10% or more of the hospital’s volume is attributable to Title XIX

Medicaid.

•Hospitals can receive both Medicaid and Medicare EHR incentive payments; eligible professionals must choose either Medicaid or Medicare EHR incentive payments.

•Additional information on the Medicaid EHR Incentive Program can be found at:http://www.wha.org/education/default.aspx

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Meaningful Use Measure Highlights

Meaningful Use Measure Highlights

CPOE retained, but substantially revised

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•Objective: Use CPOE for medication orders directly entered by any licensed healthcare professional who can enter orders into the medical record per state, local and professional guidelines.

•Measure limited to “patients whose records are maintained using certified EHR”

•CPOE only required for medication orders in Stage 1.•Others may enter the order.

•Measure: More than 30% of unique patients with at least one medication in their medication list admitted to the eligible hospital’s or CAH’s inpatient or emergency department (POS 21 or 23) have at least one medication order entered using CPOE.

•Emergency department included in measure.•Stage 2 increases percentage to 60%.

Meaningful Use Measure Highlights

Quality measures and submission revised…

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•Hospitals must report 15 measures (3 sets)•Endorsed by National Quality Forum•Not in current quality reporting program (RHQDAPU)•“e-specified” but not field tested

•Anticipate electronic submission in 2012

•Calculation through the EHR, but submission is through attestation in 2011•Numerators•Denominators•Patient exclusions

Meaningful Use Measure HighlightsQuality measures and submission revised

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Condition Measure Name

Emergency Department Throughput Median time from ED arrival to ED departure for admitted patients

Admission decision time to ED departure time for admitted patients

Stroke Discharge on anti-thrombotics

Anticoagulation for A-fib/flutter

Thrombolytic therapy for patients arriving within 2 hours of symptom onset

Anti-thrombotic therapy by day 2

Discharge on statins

Stroke education

Rehabilitation assessment

Venous Thrombo-embolism (VTE) VTE prophylaxis within 24 hours of arrival

Intensive care unit VTE prophylaxis

Anticoagulation overlap therapy

Platelet monitoring on unfractionated heparin

VTE discharge instructions

Incidence of potentially preventable VTE

Meaningful Use Measure Highlights

…but the new quality measures contain hidden functionality requirements

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•The 15 quality measures require data capture functionality beyond the initial EHR functional requirements explicitly required in certification and MU rule.

•Examples:•Data sources for the quality measures include physician documentation, medication administration, computerized provider order entry and discharge instructions. •Data elements for quality reporting must be in structured formats that are not widely used.

•Computer Sciences Corporation study:•Hospitals meeting the explicit data capture requirements under meaningful use will have only 35% of the data needed for the hospital quality measures. •The remaining 65% are hidden requirements of meaningful use.

Certification Rule Highlights

No grandfathering of CCHIT certification

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•All providers with existing CCHIT certified EHRs will need to re-certify

Hospitals must “attest” that they have certified EHR technology

•ONC will approve “ONC testing and certification bodies” (ONC-ACTBs)•First ONC-ACTBs announced last week: CCHIT and the Drummond Group.•ONC anticipates first certifications by the end of the year.

•Complete EHR, or•Combination of EHR modules.

No EHRs will be certified until ONC establishes certification entities

Certification will be for 2011-2012•NEW certification will be required in 2013.

Certification requirements linked to each meaningful use criteria

Resources

WHA Toolkit

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•http://www.wha.org/toolKit/default.aspx

•http://www.wha.org/education/default.aspx•Sept 21 - Medicaid and Meaningful Use - The "Other" EHR Incentive Program: What Hospital Leaders Should Know About the Medicaid EHR Incentive Program (Webinar)•Third Party Webinars

EHR Consulting Database (coming soon)

WHA Education

ONC Resources•http://healthit.hhs.gov/portal/server.pt?open=512&mode=2&objID=3006&PageID=20401

Questions?Questions?

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