Move to expand eligibility for EHR incentive payments seen aiding small rural hospitals

AHA News
 Critical access hospital (CAH) hospital leaders like Paul Bengston, CEO of Northeastern Vermont Regional Hospital in Saint Johnsbury, welcome the Centers for Medicare & Medicaid Services (CMS) recent decision to allow certain physicians who provide services in the outpatient departments of CAHs to participate in the Medicare electronic health record (EHR) incentive program beginning this year.

“We are very happy with CMS’ decision,” says Bengston, who leads a 25-bed CAH. He says if CMS did not fix the problem, his hospital would have lost about $275,000, and eight physicians would not have been eligible for the incentive payments.

CMS’ Jan. 10 announcement, which came in response to repeated AHA requests for timely action to address this issue, affects physicians for whom a CAH bills Medicare for their outpatient department services using optional Method II. Under this method, a CAH bills Medicare on behalf of the physician for services covered under the Medicare physician fee schedule. Due to system constraints, CMS did not include these Method II claims when it identified which physicians were eligible for its incentive programs.

“It’s not just the money, the patients appreciate this too,” says Bengston, stressing that the incentive payments will help keep physicians at the CAH. Bengston is the 2013 chair-elect of the AHA’s Section for Small or Rural Hospitals.

In its announcement, CMS says that because of system changes that will be implemented over the coming year, these physicians will not be able to submit attestations until January 2014. As a result, they will not receive incentive payments for 2012.

CMS’ decision to allow Method II physicians to participate in the incentive program “was very important for us because we have a lot of specialist providers here that we bill Method II,” says Janice Walters, executive director of revenue systems and primary care services at Charles Cole Memorial Hospital – a 94-bed critical access hospital located in rural Coudersport, PA . She estimates that seven physicians will be able to apply for the incentive payments totaling more than $250,000.

Charles Cole Memorial Hospital has invested significant financial
resources in EHRs, which have been helpful “in recruiting physicians,” according to Walters. She says CMS’ decision will help the hospital retain physicians and “continue to provide access” to high-quality care for patients in the rural community.

In a Jan. 9 letter to CMS, the AHA estimated that 60% of the 1,300 CAHs nationwide use Method II and that each of those hospitals use Method II to bill for an average of 20 professionals. In that case, a $20,000 loss in incentive payments per eligible professional would mean a total loss of $312 million for all CAHs, the letter stated. “This is an unacceptable loss for financially strapped rural providers who maintain access to care in underserved areas,” AHA Executive Vice President Rick Pollack wrote CMS.

For more on CMS’ decision, see the agency’s factsheet at:
For more on the AHA’s letter to CMS, click on:

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