Meaningful Dollars

Incentive Payments Help Physician Practices  

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Practice Management Feature – August 2011 

Tex Med. 2011;107(8):65-69.

By Crystal Conde
Associate Editor 

 South Austin Medical Clinic is no newcomer to the electronic health record (EHR) arena. Family physician Eric Weidmann, MD, says the clinic embraced a system long ago, implementing it in February 2002.

That decision continues to pay off. Dr. Weidmann was among the first round of physicians in Texas and the nation to receive $18,000 from the Medicare incentive program in May. He attested to meeting 90 days of meaningful use criteria and says his eight clinic colleagues expect to qualify for the incentive, bringing the practice's total payments to $162,000.

The Centers for Medicare & Medicaid Services (CMS) says attestation involves physicians' use of the EHR Incentive Program Registration and Attestation System  to fill in numerators and denominators for the meaningful use objectives and clinical quality measures. Using the system, physicians legally attest they have successfully demonstrated meaningful use. CMS says a complete EHR system will provide a report of the numerators, denominators, and other information. Physicians need to enter that data into the online system.

For the first payment year of the Medicaid program, physicians need only indicate adoption of a certified EHR system; they don't need to achieve meaningful use the first year. Physicians may participate in either the Medicare or the Medicaid incentive program, but not both.

Attestation of meaningful use started April 18, and according to CMS, 150 health professionals successfully attested that day alone. The maximum first-year incentive payment for eligible professionals is $18,000 for Medicare and $21,500 for Medicaid.

To qualify for the meaningful use incentives, physicians must meet 15 core criteria and select an additional five from a menu of 10. To access the list of criteria, view the meaningful use rules, and learn how to register for the incentive programs, visit the TMA website. (See "TMA HIT Resources.")

CMS bases the maximum payment on 75 percent of a physician's Medicare allowable Part B charges. Therefore, to qualify for the maximum reimbursement of $18,000, a physician's Medicare allowable Part B charges must total $24,000 for the year. But if a physician fails to reach $24,000, Medicare still will reimburse him or her for 75 percent of the Medicare allowable charges. For example, if a physician's Medicare allowable charges total $10,000 for the year, the reimbursement amount would be $7,500.

Health professionals in the Medicare incentive program can earn up to $44,000 over five years for meeting meaningful use criteria from 2011 to 2016. Eligible Medicare physicians practicing in a health professional shortage area are eligible for a 10-percent increase in incentives.

Non-hospital-based eligible physicians with at least 30-percent Medicaid patient volume can receive up to $63,750 over six years in incentive payments from 2011 to 2021. Non-hospital-based eligible pediatricians with at least 20-percent Medicaid patient volume could receive up to $42,500 during the same period.

If you haven't registered for one of the incentive programs, it's not too late. The last year physicians may begin using an EHR to qualify for the incentive payments is 2014 for the Medicare program and 2016 for the Medicaid program. Payments will continue until 2016 for Medicare and 2021 for Medicaid. (See "Incentive Program Details.")

Dr. Weidmann says the clinic's transition to an EHR has many benefits.

"Our practice clearly saw a return on investment 18 months after deployment of the EHR. Practice expansion, increased services, and more proactive patient care blossomed after three years as the patient database and feedback matured. We have committed meaningful use proceeds to the practice's basic infrastructure as well as retooling of some aging hardware," he said.

South Austin Medical Clinic committed $200,000 to a project to incorporate a comprehensive EHR and office system.

Since late 2002, the office has been 95-percent paperless for all physicians, staff members, patient functions, and outgoing data. Dr. Weidmann says the integrated EHR has revolutionized billing and collections. Major improvements include:  

  • Appropriate evaluation and management coding increased. Before implementing the EHR system, the clinic typically undercoded visits.
  • Miscellaneous charge capture by physicians and clinical staff is more efficient, and audits are more easily completed.
  • Average charges per visit increased from $65.64 in 2000 to $83.30 in 2004, with little change in the fee schedule.
  • Average reimbursement per visit increased from $56.46 in 2000 to $66.80 in 2004, even with declining fee schedules.
  • Time from date of service to collection decreased from 72 days to 41 days on average across all payers.  

Dr. Weidmann adds that the clinic's physicians will continue working to meet the meaningful use requirements, qualifying for $44,000 per eligible physician over the course of the Medicare incentive program.

"Incentive dollars will soften the blow of retooling the practice infrastructure. We view the advancing meaningful use criteria as personal and group challenges that are good for day-to-day patient care. Meaningful use is a critical piece of transparent, integrated, efficient health care for Americans. We are proud to be leading the charge," Dr. Weidmann said.

RECs at Your Service 

Earlier this year, South Austin Medical Clinic signed up with the CentrEast Regional Extension Center (REC) for help with attestation, workflow redesign, and staffing.

"We foresee substantial need for the REC to help with further process review, teaching, and retraining for the more difficult Phase 2 meaningful use criteria. Since much of the process resides in the software and varieties of user choices, I expect CentrEast REC to gain insight and share ideas that are common across EHR vendors," Dr. Weidmann said.

CMS will announce Phase 2 meaningful use criteria Dec. 21. To receive timely, authoritative information about the Medicare and Medicaid EHR incentive programs, including registration and attestation updates, and details about the payment process, subscribe to the CMS listserv.

The Texas RECs charge primary care physicians an annual subscription fee of $300 per physician for technical consulting services valued at more than $5,000. Specialists who can attest to providing primary care services are also eligible to receive REC consulting services at the subsidized rate.

Specialists interested in receiving services should contact their REC for pricing information. If a specialist is ineligible to receive subsidized-rate consulting, the REC can customize some services based on the needs of the practice. To identify the REC serving your region and to inquire about enrollment, visit the Texas Medical Association REC Resource Center.

The federal government subsidizes the RECs' consulting services. The Health Information Technology for Economic and Clinical Health Act appropriated $640 million in grant funds to create 62 RECs across the nation, including the four in Texas:   

  • North Texas REC, anchored by the Dallas-Fort Worth Hospital Council;
  • Gulf Coast REC, led by The University of Texas Health Science Center at Houston;
  • CentrEast REC, directed by the Texas A&M Health Science Center-Rural and Community Health Institute; and
  • West Texas REC, headed by Texas Tech University Health Sciences Center.   

For $300, the RECs provide these consulting services:   

  • EHR implementation and project management;
  • HIT education and training;
  • Guidance with electronic prescribing;
  • Vendor selection and financial consultation;
  • Practice and workflow redesign;
  • Privacy and security compliance education;
  • Meaningful use analysis, tracking, and monitoring;
  • Assistance in meeting meaningful use requirements for CMS incentives;
  • Collaboration with state and national health information exchanges; and
  • Ongoing technical assistance.   

Larry Robins is executive director of PediPlace, a Lewisville nonprofit that focuses strictly on primary care pediatrics for the uninsured and those who qualify for Medicaid or Children's Health Insurance Program benefits.

Following an eight-month search and evaluation process, PediPlace purchased an EHR system in February. The clinic signed up for North Texas REC services. Mr. Robins says the REC representative helped PediPlace leaders ask the right questions when meeting with potential EHR vendors. The representative also completed a workflow diagram to use during implementation. PediPlace received help from the REC to register for Medicaid's EHR incentive program.

At press time, PediPlace had received $106,000 in incentive payments. Mr. Robins says the clinic expects to receive an additional $44,000.

"Once we adopted an EHR system, the next step was extraordinarily easy. It simply required logging into the Texas Medicaid & Healthcare Partnership provider administration website, clicking on the Texas Medicaid EHR Incentive Program link, and answering a few simple questions about Medicaid patient volumes, entering the certified EHR software solution meaningful use identifier, and uploading proof of EHR adoption," he said.

The biggest challenge PediPlace faces, Mr. Robins says, is implementing the system and facilitating staff training while simultaneously maintaining the nonprofit's commitment to serve the community. Moving forward, he says the North Texas REC's meaningful use online courses will help educate health professionals in meeting Phase I requirements.

Two other physicians, Christopher Wilson, MD, and April Harris, MD, obstetrician-gynecologists at Gynics Associates in Austin, received $21,500 each from the Medicaid EHR program.

Gynics Associates purchased an EHR system in March after a two-year search for a product that fit the practice's needs. The physicians and their partner, Terrence Kuhlmann, MD, plan to begin the EHR implementation process this month. At press time, Dr. Kuhlmann was in the process of meeting 90 days of meaningful use requirements to qualify for the Medicare EHR incentive payment.

Gynics Associates signed up for the services of the CentrEast REC after purchasing an EHR system. A REC representative toured the practice to examine workflow, which will inevitably have to be modified to accommodate the EHR system's capabilities. The physicians say the REC will assist with that task and with the EHR implementation.

Dr. Wilson says the practice spent $55,000 on the EHR system and received a price break from the vendor for being a member of the CentrEast REC.

"Membership in the REC pays for itself. We will continue to rely on them to help us with implementation and with meaningful use criteria," Dr. Wilson said.

Incentives Help Cover EHR Costs 

Denise Casper, DO, a Bridgeport family physician who practices with two other doctors, received $18,000 from the Medicare incentive program. Her practice first purchased an EHR system in 2005 but implemented a new system last September. She estimates the system cost $80,000.

The practice commissioned a local information technology (IT) company to help with implementation.

She says completing 90 days of meaningful use to qualify for the incentive payment presented some challenges.

"It was hard to remember to document everything we do and to check off all the appropriate boxes. We also had to change how we record the data so we can run the necessary reports and monitor them," she said.

Dr. Casper says encouraging physicians to purchase and adopt EHRs is a massive endeavor made more tolerable by the availability of federal incentives.

"I think the Medicare incentive payments are great because they help practices afford the systems in the first place. Physicians need help with offsetting the costs of computers, printers, networks, IT support, and training," she said.

She says training classes offered through the practice's EHR vendor and county medical society programs on meaningful use helped the practice ensure it achieved meaningful use and will continue to do so.

Mr. Robins says PediPlace has plans for the more than $100,000 it has received in incentive payments.

"Payments will be invested in the future growth of our clinic, enabling us to expand access to care as well as provide annual funding for the added technology, licensing, and training costs necessary for an ongoing implementation," he said.

Five pediatric nurse practitioners work closely with PediPlace part-time Medical Director William S. Smith Jr., MD, who says the clinic accommodates 80 to 120 patients each day.

"Because we see so many children who are uninsured or receive government coverage, it's crucial we receive as much outside money as we can," Dr. Smith said.

Dr. Smith has never used an EHR system but anticipates it will cut down on the amount of paper charts used in the practice and will improve the clinic's workflow in the long run.

PediPlace plans to begin collecting 90 days of reportable data in January 2012, completing attestation in April. Mr. Robins says staff training is under way and will be a primary focus of the clinic in its effort to receive up to $63,750 per eligible health professional over the six years of the program.

Dr. Harris says the subsequent incentives Gynics Associates expects to receive will help cover the ongoing costs associated with the EHR system, such as maintenance of software and staff training.

"The $43,000 incentive payment the practice has received helps pay for some of the software and hardware. With declining Medicaid reimbursement, we wouldn't have been able to purchase our EHR without these incentive payments," Dr. Wilson said.

Crystal Conde can be reached by telephone at (800) 880-1300, ext. 1385, or (512) 370-1385; by fax at (512) 370-1629; or by email. 


TMA HIT Resources 

TMA has several health information technology (HIT) resources to help you successfully navigate the Medicare and Medicaid electronic health record (EHR) incentive programs.

For individualized on-site services, technical assistance, guidance, and ongoing support to select, implement, or upgrade EHRs, contact one of Texas' four regional extension centers (RECs). For more information, access the TMA REC Resource Center online.

TMA's EHR Implementation Guide, EHR Product Comparison Tool (TMA member login required), Medicare and Medicaid EHR Incentive Comparison, EHR incentive eligibility tool, and Medicare and Medicaid incentive program instructions are available on the HIT site.

If you have questions about the EHR incentive programs, contact the TMA HIT helpline at (800) 880-5720, or email HIT

In addition, TMA offers a meaningful use webinar that covers EHR benefits in quality of care, patient safety, and efficiency. The webinar summarizes eligibility for the Medicare and Medicaid incentives and what physicians need to do to meet meaningful use measures. This on-demand resource is $25 and includes answers to some of the most commonly asked questions and access to additional tools.

Physicians may earn 1 AMA PRA Category 1 CreditTM for completing the webinar and paying the $25 continuing medical education processing fee. For more information, contact the TMA Knowledge Center at (800) 880-7955 or visit the Distance Learning Center on the TMA website.   

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Incentive Program Details 

 Physicians who aren't ready to attest to meaningful use may register on the Centers for Medicare & Medicaid Services (CMS) website  to begin one of the available EHR incentive programs. Medicaid incentive program physicians must also register through the Texas Medicaid & Healthcare Partnership website.

Attestation for the Medicare electronic health record (EHR) incentive program is available online for physicians who have completed 90 days of meaningful use.

Medicaid doesn't require program participants to attest until the second year. In year one of participation with the Medicaid program, the physician has to attest to adoption, implementation, or upgrading to a certified EHR system.

Once a physician signs a contract with an EHR vendor and schedules the system's launch to occur in 2011, the practice is eligible for the year-one Medicaid incentive of $21,250. For year two, the physician must meet 90 days of meaningful use. Once the physician has fulfilled meaningful use for 90 days, the physician can then attest to receive the year-two payment of $8,500. The physician must attest to meaningful use for each full calendar year for the four subsequent years to receive additional Medicaid incentive payments.

Physicians who aren't ready to attest should follow these five steps to participate in the EHR incentive programs:   

  1. View eligibility guidelines and select the program in which you want to participate.
  2. Use the services of the Texas regional extension centers (RECs). Federal grants aimed at primary care physicians lower the cost of consulting services to $300 per physician.
  3. To receive incentive payments, make sure the EHR technology you're using or are considering buying has been certified by the Office of the National Coordinator (ONC). Visit the ONC Certified EHR Technology webpage for a list of certified products.
  4. Be a meaningful user.
  5. To receive your EHR incentive payment, you must attest through the secure CMS website that you've demonstrated meaningful use with certified EHR technology.   

Once a physician attests and submits the information, CMS sends payment approximately four to six weeks later.   

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