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Sweet Rewards for HIT Vendors with Final Stimulus Package

by John Moore | February 13, 2009

champagnepopWe can hear the champagne bottles popping in legacy healthcare information technology (HIT) vendors offices across the country as they celebrate what is arguably the biggest windfall in their history, the HITECH Act and its $19.2B, that is tucked into the Stimulus Bill which President Obama will likely sign on Monday.

Unlike other aspects of the Stimulus package that were whittled down to get the required votes for passage, all things HIT came through relatively unscathed. What’s in store:

$17.2B in CMS incentives for physicians & hospitals to adopt a “certified EHR”. This is a boon to legacy EHR vendors as they will claim “certified” status via previous CCHIT certification.  Unfortunately, this language is likely to be a disaster for any innovative vendor.  No matter how much wiggle room the legislative language has as to what actually is a certified EHR (they leave it up to NIST & ONC to define), the bottom-line is that any certification process is cumbersome, time consuming and rarely, if ever, keeps pace with technology developments.  We’ve said it before and will say it again, this is extremely problematic.

Money distributed through CMS will be tiered, e.g., first year physician gets $15k, 2nd, $12k, etc.  If that physician gets started quickly (by 2010) they can reap some $41K. If they drag their feet and start a couple of years later, they’ll get a total of $24k.  A similar tiered model is also established for hospitals.  All of this is laid out in Division B of the Bill beginning on page 480.

To get reimbursement, a physician or hospital has to demonstrate that:

The certified EHR is “used in a meaningful manner”, they reference eRx.  They must be able to demonstrate the certified EHR “is connected n a manner that provides for electronic exchange of health information to improve quality of care such as care coordination.” Lastly, they must demonstrate that the certified EHR can also provide reporting on “clinical quality measures.”  Fine attributes to promote but see no reason why it must be done with a certified EHR.  Why not simply state that the physician/hospital must be able to demonstrate such activities?  You don’t need a “certified EHR” you need technology that can get the job done.

Flipping over to Division A, beginning on page 286 (real pain going back and forth between these two documents – do they do this on purpose?) we find the language that lays out how a certified EHR will be defined.  ONC will turn over $20M to NIST who will go forth and define the test standards ad implementation specifications and testing infrastructure for a certified EHR.  There on page 332, Division A we also find the language regarding the testing that NST will manage…

may include a program to accredit independent, non-Federal labs to perform testing

While they do not spell out CCHIT, sure sounds like that is who they are referring to.

An interesting little piece found on page 488 of Division B is the requirement that HHS do a study and produce a report on “Availability of Open Source HIT Systems.”  Odd to have such a study and can only think it is a pet project of someone in the VA looking to keep VistA alive or someone like Sun Microsystems looking to further substantiate the open source CONNECT NHIN they developed.

$2B for the Office of the National Coordinator (ONC). An absolutely huge amount of money of which 15% ($300M) is going directly to RHIOs/HIEs.  The nominal money spent to date, via grants for RHIOs, has been a waste.  Let’s hope this time that no money is distributed until a RHIO can provide a detailed business plan and revenue model that will make them self-sustaining within a given time frame, say 3yrs.

A significant portion of that $2B will go to establish a network of HIT Research Centers.  There will be one main Center, a number of regional Centers and HIT Extension Centers at the State level.  For State Centers a tiered funding model is also used with State having to provide matching funds that increase over time. These Centers will be established to gather lessons learned in best practices for adopting, deploying and using HIT in a clincal setting.  These Centers, in the short-term, may also be used for training HIT professionals.  Good idea, if they can keep these Centers focused and delivering value at the local level.  Agricultural Extension Services have been doing this for years with mixed success, hopefully they can learn from them.

It should also be noted that Congress has also given ONC the authority (Division A pg 322) to “develop and provide a qualified EHR unless determined that the needs and demands of providers are being substantially and adequately met through the marketplace”

Plenty more to look at in this Bill, but believe the above hits the high points, though we reserve the right to come back and add to it as we uncover more items of interest.

Concluding Thoughts

When we first wrote about HR 1, we were very concerned with the terminology for “certified EHR”.  That concern only increased upon reading very similar language in the Senate version.  It was pretty much a foregone conclusion that we were going to get stuck with that dreaded “certified” albatross, which has indeed occurred.  At this point, the best we can hope for is that insightful minds will take full advantage of the loose language in the HITECH Act and craft a definition and implementation program for certified EHR that promotes innovation, rather than hinders it.  Unfortunately, with the rush to do something, anything to get the economy on track, haste may make waste.  Congress has given ONC until Dec. 31, 2009 to “adopt an initial set of stnadards and implementation specifications” for certified EHRs.  Let us all pray that they use that time wisely.

While these legacy HIT vendors celebrate there will be many a small, innovative HIT vendor wondering what the heck does “qualified” or “certified” EHR mean as the legislation will only provide incentive payments to those physicians and hospitals that adopt a “certified EHR.”

Stay up to the minute.

“As biometric data becomes cheaper and easier to collect through smart sensors, devices, and mobile apps, expect to see more innovations in consumer health.”

-Alicia Vergaras