Consultant: Prepare Now for Incentives

Physicians without an electronic health records system should start work soon to get one so they can qualify for Medicare and Medicaid incentive payments under the economic stimulus law, says Michael Mytych, principal at Health Information Consulting LLC, Menomonee Falls, Wis.

Those incentives start in 2011 and waiting too long means running out of time and not getting all the available incentives, he adds. "They probably should start by the end of the third quarter of this year or they won't be ready."

The new law will enable physician practices to receive at up to $44,000 per physician in incentive payments over five years, according to the legislation. Physicians meeting certain criteria, such as serving an underserved rural region and having a certain case mix of patients, could get more than $60,000.

Many physicians have no idea how long it takes to select, implement and start using an EHR, or to rollout the functions needed to meet the "meaningful use" requirements for incentive payments, Mytych says. He has group practice clients that have had EHRs for two or three years and still aren't using some of those functions--such as clinical documentation and electronic prescribing.

Hospitals also are eligible for incentive payments, although estimates of how much they could get based on early analyses of the new law range from $2 million to $11 million.

A 100-bed community hospital client of Mytych's has calculated it will be eligible for $2 million. The hospital also has calculated a $5 million cost for a qualifying EHR: $4 million for the software and $1 million for hardware and peripherals, plus $300,000 annually for support. "So, $2 million will help them a great deal," he adds.

All provider organizations getting EHRs should put specific language in their contract stating that the vendor or vendors will "fully comply with federal requirements before they get their payments," Mytych advises.

--Joseph Goedert

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