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It™s Not Too Late to Avoid Payment Adjustments

Eligible professionals (EPs), eligible hospitals, and critical access hospitals (CAHs) that cannot demonstrate meaningful use of electronic health records (EHRs) could soon face Medicare payment adjustments. But CMS has an important message for providers: there™s still time to prove meaningful use and avoid adjustments.

“Some providers are under the impression that it™s too late, but there™s certainly time this year and there™s time next year,” says Robert Anthony, deputy director of the Health IT Initiatives group in the Office of E-Health Standards and Services at CMS. “It™s not too late for them to select an EHR that™s right for them, to implement that EHR, and to become meaningful users.”

Beginning January 1, 2015, CMS will apply payment adjustments to Medicare physician fee schedule rates of EPs who do not demonstrate meaningful use before October 1, 2014. EPs will face a cumulative 1% decrease for each year that they do not meet meaningful use standards.  If  CMS deems the number of Medicare EPs demonstrating meaningful use in 2018 to be favorable, it may place a 5% cap on the cumulative adjustments.

Beginning October 1, 2014, eligible hospitals that have not proved to be meaningful users will see adjustments applied to the percentage increase to the Inpatient Prospective Payment Systems (IPPS) payment rate, while CMS would apply CAH adjustments to the cost reporting period in which the CAH was unable to demonstrate meaningful use.

EPs and eligible hospitals that have demonstrated meaningful use in 2011 or 2012 can avoid the 2015 payment adjustments by demonstrating meaningful use throughout 2013. Those who have not yet proved meaningful use can avoid the 2015 adjustments by reporting meaningful use for a 90-day period in 2013 or in 2014 before beginning of fiscal year 2015. Providers must continue to demonstrate meaningful use to avoid payment adjustments in subsequent years. CAHs must demonstrate meaningful use by fiscal year 2015 and will need to continue to be meaningful users thereafter.

“That™s really why we™re trying to get people going now. There™s still time for people to participate and receive incentive monies and we™d really love to see those people participate,” says Anthony.  “We™re hoping as we talk more about it this year that more people will get involved and receive some incentives and avoid payment adjustments overall.”

Anthony says that the best way to demonstrate meaningful use is to look at the big picture, rather than focusing on each incentive program objective individually. In his experience, the providers that are successful at demonstrating meaningful use are the ones that incorporate the objectives into their overall workflow and standards because aiming to meet just the minimum can often be more of a challenge.

While it may seem as if the payment adjustments are a means of penalizing Medicare providers who fail to exhibit meaningful use, Anthony says that “the goal here is to drive people to participate.” He describes it as “a second stage in moving people towards meaningful use,” with the first stage being payment incentives. According to Anthony, CMS hopes that providers will be compelled to display meaningful use not only because it can improve the quality of healthcare but because they want to receive payment incentives and avoid negative payment adjustments.

“Incentive payments are great. Avoiding payment adjustments is fantastic. But I think the real payout for people in healthcare is going to be improving the quality of care for patients,” says Anthony.

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