CMS to launch Medicare pilot project that will provide physicians with incentives to use health IT

Jun 11 2008

HHS Secretary Mike Leavitt on Tuesday announced the 12 cities and states that have been chosen to participate in a $150 million Medicare pilot program to encourage physicians to use electronic health records, CQ Today reports.

The five-year program will help nearly 1,200 small practices in the 12 regions switch from paper to digital record keeping. Four of the communities will begin implementing the program in the next several months, and the other regions will begin next year.

In the first year of the program, participating physicians will receive increased Medicare payments for showing that they have implemented EHR systems. In the second year, payments will be increased for physicians who use EHR systems to report on their quality of care. In the final three years of the program, physicians will receive payment increases if they can show that they used EHRs to meet quality-of-care standards. Leavitt said the program is expected to be "budget-neutral" because the use of EHRs will produce "sufficient savings" to offset the higher payments (Wayne, CQ Today, 6/10). Leavitt said, "The use of electronic health records, and of health information technology as a whole, has the ability to transform the way health care is delivered in our nation" (Kohn, Baltimore Sun, 6/11).

The pilot program is part of a broader plan by HHS as part of an executive order issued by President Bush in 2004, which included a goal of providing most U.S. residents access to EHRs by 2014 (CQ Today, 6/10). The 12 participating regions are Jacksonville, Fla.; Pittsburgh; Madison, Wis.; Alabama; Delaware; Washington, D.C.; Georgia; Maine; Louisiana; Oklahoma; South Dakota; and Virginia. Physicians in four of the jurisdictions this fall can begin enrolling in the program, while physicians in the other eight communities will join the program in 2009 (Baltimore Sun, 6/11).

Lawmakers Push EHR Adoption

In related news, Congressional lawmakers on Tuesday, as part of National Health IT Week, called on physicians nationwide to adopt EHRs in their practices, CongressDaily reports. Rep. Patrick Kennedy (D-R.I.), chair of the 21st Century Health Care Caucus, said although sweeping changes are needed, "This is not a one-shot deal. It's going to take renewed efforts to change health IT year-in and year-out." Kennedy has introduced legislation that would create a public-private partnership to promote portable, consumer-controlled EHRs, according to CongressDaily. Several other lawmakers also have proposed legislation that aims to expand the use of health IT.

However, Rep. Tim Murphy (R-Pa.), co-chair of the health care caucus, said Congress is "not moving as quickly as I'd wish" to pass meaningful health IT legislation. Rep. Phil Gingrey (R-Ga.) said to his colleagues, "It's time to move these bills -- let's get this done and let's do it before 2014" (Noyes, CongressDaily, 6/11).

Editorial, Opinion Piece

• San Jose Mercury News: "Besides saving lives," a standardized EHR system "will save money," a Mercury News editorial states, adding that it is "one of the few medical cost-containment ideas that don't involve rationing care." The editorial continues, "Privacy concerns still are widespread and legitimate," and "[i]dentity theft and other abuses of the Internet age are serious problems." But if "millions of Americans regularly rely on online banking and other financial transactions," then "[s]urely we can find a way to reasonably protect the privacy of medical records as well," the editorial states (San Jose Mercury News, 6/11).
• John Engler, Detroit Free Press: "This needless lack of efficiency" from paper records "is costing [the U.S.] both lives and money," Engler, president and CEO of the National Association of Manufacturers and a former Republican governor of Michigan, writes in a Free Press opinion piece. According to Engler, a national health IT system could eliminate the "frustration" associated with paper records "and save the United States at least $81 billion a year in health care costs." In addition, the widespread adoption of EHRs "would mean that any doctor anywhere in the country could access an accurate and current medical history of any patient with a few clicks of a computer mouse," according to Engler. He concludes, "With health care costs rising at three times the rate of inflation, we can't move fast enough to pump some digital efficiency into our health care system" (Engler, Detroit Free Press, 6/11).