HHS Relaxes Some Rules For Doctors, Hospitals To Get Aid For Electronic Health Records

The federal government is making it easier for health care providers to get bonus money for using electronic health records starting next year, but the hospital industry said it still had concerns that too few facilities would qualify.

The Department of Health and Human Services released the final regulations Tuesday, seven months after the initial rules were met with heavy criticism from doctors and hospitals. 

“The requirements may still be out of reach for many American hospitals,” said Don May, vice president of policy for the American Hospital Association.

For example, May criticized the administration for requiring hospitals to switch to computerized systems to monitor medication orders by next year – before they are eligible for the financial incentives.

The federal government is providing $27 billion over the next 10 years to reward doctors and hospitals for installing electronic health systems. Doctors can get up to $44,000 from Medicare and $63,750 from Medicaid. Hospitals will be eligible for at least $2 million from the federal government depending on their size and number of patient discharges. The bonus money was included in the 2009 federal stimulus package.

Dr. Donald Berwick, who was sworn in Monday as the new administrator of the Centers for Medicare and Medicaid Services, said electronic health records will mean, “better, smoother and safer care.”

But he acknowledged providers are struggling to both afford the new computerized systems and shift away from using paper and pen. “Today reflects really good progress,” Berwick said at a press conference in which officials from the Department of Health and Human Services released the final rules for the payments. “It’s important that we lift our eyes to see how much better we are going to be when we get through the awkwardness of change.”

Doctors and hospitals heavily criticized the preliminary rules released in January, saying they were too stringent.

Under those initial regulations, doctors could have been denied any federal incentive payments if they failed to meet 25 objectives, such as the patient medication lists or whether a patient smokes and hospitals would have been required to meet 23.  

Now, doctors will have to meet 15 objectives, and at least five from a list of 10 more. Hospitals will have to meet 14 objectives, and at least five more goals.

The federal government in 2015 will start reducing payments to hospitals and doctors who are not using electronic health records.

HHS Secretary Kathleen Sebelius said Tuesday only about 20 percent of hospitals and 10 percent of physicians have basic electronic health systems, which the Obama administration and health experts say are needed to improve health quality, reduce errors and lower costs.

Some large hospitals systems, including those operated by the Department of Veterans Affairs, have taken the lead on electronic records. VA doctors have been using computerized systems for more than a decade to prescribe medications. Advocates say these systems help remove possible complications, such as misreading doctors’ notoriously bad handwriting, and provide electronic warnings about dangerous drug interactions.

But the AHA’s May said the government should have deferred that goal until 2013 because of the high costs involved.

The government did ease the requirement slightly from what it proposed in January. To qualify for the bonus money under the new regulations, only 40 percent of medications will have to be electronically prescribed, compared to 75 percent as the government initially proposed.

The Federation of American Hospitals, which represents for-profit hospitals, said in a statement that it supports the new regulations, “but there is further work to do.” The federation remains concerned that in multi-hospital systems, each of the facilities will have to meet the standards for any member of the system to qualify for the bonus money. It wants each of its hospitals to qualify separately.

The American Medical Association withheld making a comment on the new regulations, saying it needed time to review them.

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