EHR Bonus Program Needs Overhaul, GOP Senators Say

April 22, 2013

The federal incentive program for electronic health record (EHR) systems needs a reboot because it spends its $35 billion budget "ineffectively" and risks "not achieving its goals," especially software interoperability, 6 GOP senators said in a white paper released last week.

The senators' report encapsulates criticisms of the program issued by organized medicine, the Office of Inspector General (OIG) in the Department of Health and Human Services (HHS), and House Republicans.

"A growing body of objective analysis and empirical data suggest that the program needs to be recalibrated to be effective," write Sen. Lamar Alexander (R-TN), Sen. Richard Burr (R-NC), Sen. Tom Coburn, MD (R-OK), Sen. Mike Enzi (R-WY), Sen. Pat Roberts (R-KS), and Sen. John Thune (R-SD).

The senators did not, however, recommend the drastic measure proposed by House Republicans — suspending incentive payments to physicians and hospitals that demonstrate meaningful use of EHRs. Physicians can receive up to $44,000 over the course of 5 years through Medicare or up to $64,000 over the course of 6 years through Medicaid if they meet strictly defined measures of meaningful use.

Nevertheless, the senators' white paper gives a black eye to the incentive program, created by the economic stimulus legislation of 2009. Chief among the complaints is the unfulfilled promise of interoperability, which boils down to physician A sharing a patient's chart electronically with physician B, even though they use different kinds of EHRs. A dearth of unified standards on how data can be swapped, the senators said, "has resulted in vendors using vastly differently terms, methods, and approaches to designing their health [information technology] systems."

Sharing patient data electronically is one example of meaningful use. With each stage of meaningful-use requirements — stage 1 is underway, and stage 2 commences next year — the performance measures for data sharing become increasingly ambitious. However, the Centers for Medicare & Medicaid Services (CMS) is flying through these stages so fast in the push to hand out bonuses that physicians are not getting the hang of meaningful use, according to the senators. They agree with organized medicine that CMS needs to evaluate the incentive program before progressing to stages 2 and 3. The senators give CMS credit, however, for deciding not to develop stage 3 requirements this year.

Can Physicians Maintain Their EHRs When Bonuses Dry Up?

The 6 Republican senators have other bones to pick with the federal incentive program:

  • Proponents of EHRs say that the technology will reduce healthcare costs, but the senators contend that the exact opposite may be happening. They point to studies indicating that some physicians use digital wizardry to inflate Medicare claims for evaluation and management services.

  • The incentive program needs stricter oversight to make sure that EHR bonuses are awarded only to deserving physicians, according to the senators. They cite an OIG report from last fall stating that the program is vulnerable to fraud because physicians can qualify for a bonus simply by swearing to the government that they meet meaningful-use requirements without providing back-up documents. The OIG recommended that CMS audit bonus winners before cutting a check, a safeguard that CMS has recently implemented after having objected to it initially as counterproductive.

  • The senators also worry that the Obama administration has not done enough to protect patient privacy in the pursuit of digital medicine. They again bring up last fall's OIG report, which chided CMS and HHS for not doing enough within their own offices to keep patient data under wraps. If the government struggles to protect patient privacy, "it is reasonable to assume that providers...may face similar challenges," the senators wrote.

  • Finally, the senators wonder whether the EHR incentive program has a long-term future. Financially fragile physicians and hospitals, they say, will be hard-pressed to maintain the EHR systems when incentive payments eventually cease. In addition, complying with meaningful-use requirements — the alternative is a Medicare penalty beginning in 2015 — challenges physicians who are dazed and confused by other federal programs with an EHR angle and their uncoordinated requirements.

The senators sent their white paper to HHS Secretary Kathleen Sebelius and asked her in an accompanying letter to address their concerns. "We hope this process will begin a robust dialogue," they write. They asked Sebelius for a written response by June 16.

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