Federal and state governments, including Missouri, have been engaged in a series of activities to improve the availability of patient data in electronic format. One such activity is the creation of the Medicaid and Medicare electronic health record (EHR) incentive programs.  These incentives will be in the form of yearly payments, beginning in 2011, to help a broad range of health care professionals and hospitals implement and meaningfully use EHRs. The following FAQ describes incentive payment eligibility, program requirements, payments, Missouri resources, and other relevant details.  This information will be updated as policy and program decisions are made at both the federal and state level.

General Questions

When will MO HealthNet begin enrollment for the Medicaid EHR Incentive Program?

MO HealthNet plans to make enrollment available early in 2011. In order to launch the program, MO HealthNet must receive approval from the Centers for Medicare and Medicaid Services (CMS). MO HealthNet anticipates receiving this approval in late 2010 or early 2011.

Where can I get more information about MO HealthNet’s policies regarding eligibility, payment and other topics?

CMS requires all states implementing the Medicaid EHR Incentive Program to prepare a State Medicaid Health IT Plan (SMHP). Primarily a technical document, the SMHP describes MO HealthNet’s approach to EHR Incentive Program implementation. The final version submitted to CMS for review is posted on the MO HITECH website and can be accessed at http://dss.mo.gov/mhd/general/pdf/draftsmhp102010.pdf. Once Missouri has received CMS approval of its SMHP, this FAQ will be updated to reflect final program policies and procedures.

Where can I find information on what electronic health records (EHRs) have been certified?

Eligibility for Medicare and Medicaid EHR incentives is based, in part, on using certified EHR technology. The Office of the National Coordinator for Health Information Technology (ONC) has developed a process to certify EHR vendors and products. The list of certified products can be viewed here: http://onc-chpl.force.com/ehrcert.

Where can I get more information about the EHR Incentive Program?

The Centers for Medicare and Medicaid Services (CMS) has a broad range of information available on its website (e.g., federal eligibility requirements, meaningful use, payment process, etc.): https://www.cms.gov/EHRIncentivePrograms/.

Program Eligibility

Who is an “eligible professional” for the Medicaid EHR Incentive Program?

In Medicaid, eligible professionals (EPs) include physicians, dentists, certified nurse midwives, nurse practitioners; physician assistants practicing in rural health clinics or Federally-Qualified Health Centers (FQHCs) led by a physician assistant are also eligible. EPs must have at least a 30% patient volume attributable to Medicaid (20% for pediatricians). MO HealthNet has proposed that EPs have the flexibility to base their volume on either (1) the EP’s individual Medicaid patient encounters as a percentage of the EP’s total encounters or (2) the practice’s total Medicaid encounters as a percentage of the practice’s total patient encounters. MO HealthNet must receive approval from the Centers for Medicare and Medicaid Services (CMS) before this approach is finalized.

Regarding the 30% patient volume threshold under the Medicaid incentives, will this be required per provider or by group?

Eligible professionals may meet the 30% volume requirement either from a group calculation or individual calculation.

Are there different volume criteria for Federally Qualified Health Centers (FQHC) or Rural Health Centers (RHC)?

Yes. EPs working in FQHCs or RHCs may meet the 30% volume requirement through a combination of Medicaid and “needy individual” encounters. Needy individual encounters are those encounters funded in part or in whole by MO HealthNet, MO HealthNet for Kids, uncompensated care or patient payment based on a sliding scale.

Does a physician with a private hospital-based practice qualify for incentive payments?

No. Hospital-based physicians do not qualify for the EHR incentive program. Hospital-based physicians are defined as those furnishing substantially all (90%) professional services in a hospital or emergency department setting. Eligible professionals who practice in hospital-owned outpatient clinics qualify for the incentive program provided they meet all other program criteria.

Are all hospitals considered eligible to participate in the Medicaid EHR Incentive Program?

No. Eligible hospitals (EHs) include: acute care hospitals with a Medicaid patient volume of at least 10%, all stand-alone children’s hospitals, cancer hospitals and critical access hospitals.

Are long term care providers (e.g., nursing homes) eligible for EHR incentive payments?

No. Nursing homes are not eligible. Under Medicaid, the only eligible institutional providers are acute care hospitals, stand-alone children’s hospitals, cancer hospitals, and critical access hospitals. Eligible Professionals may choose to assign incentive payments to their employer. Therefore, if an Eligible Professional employed by a nursing home met the criteria, s/he could choose to assign their payment to their employer.

How should eligible providers (EPs) and eligible hospitals (EPs) apply for Medicaid or Medicare incentives?

The Centers for Medicare and Medicaid Services plays a central role in administering both incentives. Regardless of whether an EH or EP chooses Medicare or Medicaid incentives, they will be required to enroll through the National Level Repository (NLR). The NLR is still being developed and is not currently accessible.

Once the NLR information is entered, EPs will select either the Medicare or Medicaid incentives. If an EP chooses the Medicaid incentives, additional information must be given to MO HealthNet. This process will happen via the MO HealthNet website. Specific details of the MO HealthNet program are under development; updates will be provided as they are available.

Incentive Payments

When will EHR incentive payments to eligible professionals and eligible hospitals begin?

YAccording to federal guidelines, Medicare incentive payments will begin May 2011. This date assumes that eligible professionals (EPs) and eligible hospitals (EHs) have submitted all the appropriate information and met all eligibility and reporting requirements, and that Missouri’s program has been approved by CMS Missouri is engaged in considerable planning efforts in order to coordinate the EHR Incentive Program with other State and Federal health IT activities and will post additional information about program launch as it becomes available.

If an eligible professional uses a certified EHR in accordance with CMS and ONC requirements, could that professional receive both the Medicare and Medicaid EHR payment incentive?

No. Eligible professionals (EPs) may only receive an EHR incentive payment under either Medicare or Medicaid in a given year. EPs can switch programs one time only between the time the program begins and 2014. Eligible hospitals can receive incentives under both programs.

What is the maximum Medicaid EHR incentive an eligible professional can receive?

Medicaid eligible professionals (EPs) may receive up to $63,750 over six years (2011 through 2021). For the first payment year, Medicaid EPs can receive up to $21,250 for the initial adoption, implementation or upgrade of certified EHR technology. In subsequent years, Medicaid EPs can receive up to $8,500 annually for costs related to operation, maintenance and demonstration of meaningful use of EHR technology.

What is maximum Medicare EHR incentive an eligible professional can receive?

Eligible professionals (EPs) can receive up to $44,000 over four years (2011 through 2015). The payment is equal to 75% of Medicare allowable charges for covered services furnished by the EP in a year (maximum payment in the first, second, third, fourth, and fifth years of $15,000; $12,000; $8,000; $4000; and $2,000, respectively). Early adopters (EPs whose first payment year is 2011 or 2012) can receive a maximum payment of $18,000 in the first year. For EPs who predominantly furnish services in a health professional shortage area (HPSA), Medicare incentive payments would be increased by 10%.

What if my EHR system costs much more than the incentive? May I request additional funds?

No. By law, the EHR Incentive Program does not provide for incentive payments beyond the already-established limits, regardless of EHR system costs. The purpose of the payments is to encourage the adoption and meaningful use of certified EHR technology, rather than to reimburse fully for such activities.

What information will be publicly available regarding providers who receive EHR incentive payments?

For those receiving Medicare incentives, CMS will post the list of names online. The list will include elements identified in the originating legislation (name, business address, and business phone number for all Medicare eligible professionals and hospitals who received incentive payments). There is no requirement to publish the names of those receiving Medicaid incentive payments, although States may opt to do so.

Is the funding available upfront to help an eligible professional (EP) purchase an EHR system, or will EPs receive incentive payments only after implementation?

No up-front funding is provided. In Medicare, incentives are only available after EPs demonstrate meaningful use. This demonstration will require reporting on activities over a contiguous 90-day period. In Medicaid, providers can receive some funding before demonstrating meaningful use, provided they can demonstrate steps to adopt, implement or upgrade their certified EHR technology.

What types of Medicaid incentives are available to providers?

Through 2016, eligible professionals (EPs) can receive a one-time incentive payment for 85% of net average allowable costs (not to exceed $25,000) for the purchase and initial implementation or upgrade of a certified EHR technology. After acquiring an EHR and receiving the first payment, EPs can then receive incentive payments for up to 5 years (but not beyond 2021) for the net average allowable costs to operate, maintain, and use their EHR (allowable cap per year is $10,000) if they meet the definition of a meaningful EHR user. More information on meaningful use is provided in the meaningful use section of this FAQ.

What are the differences between the Medicare and Medicaid EHR Incentive Programs?

There are several key differences. The first is that only providers with at least a 30% Medicaid patient volume (20% for pediatricians) qualify for the Medicaid incentives. Second, payments for the Medicaid program are up to a maximum of $63,750 while in Medicare, the maximum is $44,000. Finally, in Medicaid, payments are for actual upfront purchase and ongoing maintenance costs. By contrast, Medicare payments are made as a percentage of Medicare charges rather than the actual purchase and maintenance costs.

Can my employer require me to assign my incentive to them?

No. Eligible Professionals (EPs) may voluntarily assign their incentive payment to their employer. This is likely to be most common in environments where the employer paid for most or all of the certified EHR technology. The Centers for Medicare and Medicaid Services (CMS) views the assignment process as primarily a contractual issue between employer and employee. As such, there is a limited involvement by the federal government or by MO HealthNet.

Are incentives subject to income taxes?

Yes. Incentives are subject to income like other gross receipts

Meaningful Use

What is meaningful use?

CMS has outlined a number of HIT functional and clinical quality measures that must be met in order to be deemed a meaningful user (additional meaningful use information can be found on the CMS website: http://www.cms.gov/EHRIncentivePrograms/110_Meaningful_Use.asp#TopOfPage).

HIT functional measures are as follows:

  • 15 core measures (eligible professionals)
  • 14 core measures (eligible hospitals)
  • Both eligible professionals and eligible hospitals must then choose 5 of 10 HIT functional measures from a "menu"
  • Eligible professionals must choose at least 1 “menu” measure that addresses public health

Core measures include actions such as e-prescribing, computerized physician order entry, maintaining up-to-date problem lists, etc. A full list of HIT measures can be viewed here (begins on slide 22): http://www.cms.gov/EHRIncentivePrograms/Downloads/EHR_Incentive_Program_Agency_Training_v8-20.pdf

Clinical quality measure requirements are as follows:

Eligible Hospitals: 15 measures

Eligible Professionals: 3 specified core measures (National Quality Forum); plus 3 additional measures chosen from a menu

A full list of clinical quality measures can be viewed here (begins on slide 34): http://www.cms.gov/EHRIncentivePrograms/Downloads/EHR_Incentive_Program_Agency_Training_v8-20.pdf

What are the reporting periods for demonstrating meaningful use?

CMS rules require eligible professionals (EPs) and eligible hospitals (EHs) to report on any continuous 90-day period within a payment year in which an EP or EH successfully demonstrates meaningful use of certified EHR technology. This meaningful use reporting period began on October 1, 2010 for Medicare EHs. There is no reporting period associated with the Adopt, Implement or Upgrade (AIU) component of the Medicaid EHR Incentive Program. This means that EPs who choose to receive incentives based on AIU criteria, rather than meaningful use, would be required to attest to their efforts to adopt, implement or upgrade Certified EHR Technology. CMS has indicated that documentation to support the attestation must be binding in nature (e.g., a signed contract, invoice, etc.). MO HealthNet will provide more specific examples of acceptable documentation closer to program launch.


What are the penalties for not using a certified EHR system and/or demonstrating meaningful use?

For Medicare, physicians who are not "meaningful" EHR users will see a 1% reduction in payment starting January 1, 2015. The reduction increases to 2% in 2016 and 3% in subsequent years. Hardship exceptions may be issued on a case-by-case basis, such as exceptions for physicians who practice in rural areas without adequate Internet access. There are no Medicaid penalties.

Will a provider who doesn’t enroll in either incentive program or doesn’t meet meaningful use requirements see a reduction in their Medicare rate?

Yes. There is no requirement that providers participate in either the Medicare or Medicaid Incentive Program. Providers can opt out but will receive a reduction in Medicare payment if they do not meet meaningful use standards by 2015.

Missouri Resources

Will MO HealthNet endorse any particular EHR vendor?

No. Any EHR must meet federal certification guidelines. On August 11, 2010, the Office of the National Coordinator for Health Information Technology (ONC) released temporary certification guideline. EHR vendors wishing to become certified must go through an established process to get this temporary certification. More information the process, guidelines, and additional certification issues is available here: http://healthit.hhs.gov/portal/.

Besides the incentive payments, what resources are available to help implement an EHR?

The Missouri HIT Assistance Center is a federally-funded resource center charged with assisting providers with EHR implementation. In particular, the Center must target services to solo and small primary care providers, rural providers, community clinics and critical access hospitals. The Center has negotiated group purchasing arrangements with selected vendors. More information is available here: http://www.assistancecenter.missouri.edu/.

The Centers for Medicare and Medicaid Services has a comprehensive resource center which can be accessed here: https://www.cms.gov/EHRIncentivePrograms/