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The 2009 American Recovery and Reinvestment Act set up established payment adjustments under Medicare for eligible hospitals, who are not users of Certified Electronic Health Record Technology (CEHRT). According the CMS, hospitals that don’t demonstrate meaningful use for an EHR reporting “period associated with a payment adjustment year will receive reduced Medicare payments for that yearOctober 1st 2014 marked the first payment adjustments for eligible hospitals and now over 4,800 eligible hospitals may participate in the EHR incentive programs.

Straight from CMS

1.     What is an eligible hospital?
2.     How does a hospital demonstrate meaningful use in order to avoid a payment adjustment?

  • An eligible hospital demonstrates meaningful use by successfully attesting through either the CMS Medicare EHR Incentive Programs Attestation System (https://ehrincentives.cms.gov/hitech) or through its state’s Medicaid EHR Incentive Program attestation system.

3.     How have hospitals received incentives payments? Are incentive payments still available? 

  • The Medicare Electronic Health Record (EHR) Incentive Program provides incentive payments for eligible acute care inpatient hospitals that are meaningful users of certified EHR technology.
  • Incentive programs are run by state.
  • The Medicaid EHR Incentive Program provides for incentive payments for eligible acute care hospitals and children’s hospitals.

4.     What is the FY 2017 EHR Eligible Hospital payment adjustment?

  • Eligible hospitals that are not meaningful EHR users are subject to a payment adjustment beginning on October 1, 2016.
  • This payment adjustment is applied as a reduction to the applicable percentage increase to the Inpatient Prospective Payment System (IPPS) payment rate, thus reducing the update to the IPPS standardized amount for these hospitals.
  • Eligible hospitals receive the payment adjustment amount that is tied to a specific fiscal ye

5.     How many hospitals successfully demonstrated meaningful use for the 2017 payment adjustment year?

  • In total, 98% of eligible hospitals and CAHs across the country have successfully demonstrated meaningful use at either Stage 1 or Stage 2.

6.     Is there an exceptions process for hospitals that did not demonstrate meaningful use?

  • Eligible hospitals may apply for hardship exceptions to avoid the payment adjustments.
  • Applications must be submitted no later than April 1st of the year before the applicable payment adjustment year.  The time period for hardship exceptions for the 2017 payment adjustment closed on April 1, 2016.
  • Hardship exceptions are granted on a case-by-case basis and only if CMS determines that requiring an eligible hospital to be a meaningful EHR user would result in a significant hardship.
  • Eligible hospitals are able to apply for hardship exceptions in: Infrastructure, New eligible hospitals, Unforeseen Circumstances, 2014 EHR Vendor Issues and Patient Access and Medicare Protection Act (PAMPA)

7.     Does a hospital have to achieve meaningful use each year to avoid the payment adjustments or can it avoid the payment adjustments by achieving meaningful use only once?

  • Eligible hospitals must demonstrate meaningful use every payment year according to the timelines detailed above in order to avoid Medicare payment adjustments.
All information from CMS Fact Sheet on EHR Incentive Programs. For more information on the Medicare and Medicaid EHR Incentive Programs visit: https://www.cms.gov/EHRIncentivePrograms