You may have heard that contained within the stimulus bill that was passed on February 17th are financial incentives to physicians for the adoption of electronic health records (EHR). At first, the sound of up to $44,000 in incentives over a five-year period will sound like music to your ears. But it may be best to consider it a little like harp music: it sounds lovely, but there are many strings attached.

The key term in the legislation that will be the determining factor in the receipt of incentive payments is “meaningful use of EHR technology.” According to the legislation, there are three key components that fall under the definition of meaningful use. These are:

• Utilization of EHR for electronic prescribing of medications;
• Use of EHR for electronic exchange of health information which provides improved care coordination; AND
• Using the EHR for the submission of clinical quality measures.

This is the first year that physicians are eligible for a bonus for e-prescribing (explained in detail here). If you haven’t acquired the necessary software for electronic prescribing, I recommend doing so as soon as possible. The incentive payments for this service will only be available for a three-year period; beyond that time frame, the smooth operation of an e-prescribing system will allow for a seamless transition into the EHR incentive program.

For the last few years, clinical quality measures have been reported by some physicians as part of the Physician Quality Reporting Initiative (PQRI) pilot program. Financial incentives have been offered for the submission of additional codes on Medicare claims (found in Appendix H of CPT, in detail the steps taken toward positive patient outcomes. The new legislation passed in February confirms the long-held belief that PQRI is a small step toward mandatory reporting of clinical quality measures.

What may be the most important portion of the legislation is the long-term consequences of not meaningfully using electronic health records. Beginning in 2016, if a provider is not utilizing EMR, total payments from Medicare will be reduced by 1% of the full physician fee schedule. Payments will continue to decrease by 1% of the fee schedule for each subsequent year that the provider has failed to adopt an EHR, up to a maximum reduction of 95% of the fee schedule.

To qualify for the maximum incentive payments for EHR adoption, an electronic medical record must be in meaningful use by 2011.

Fi-Med offers EMR and e-prescription solutions as a part of our comprehensive practice management services. To learn more, leave comments for us here, email us at the address below, or call us at 800-318-0019.