GAO echoes physician concerns on EMR, e-prescribing bonuses

Physician organizations say the misaligned Medicare incentive programs force practices to waste resources on interim electronic prescribing systems to beat a June 30 deadline.

By Charles Fiegl — Posted March 14, 2011

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Physicians are duplicating efforts and wasting money to satisfy Medicare's mismatched requirements for electronic prescribing and electronic medical record incentive programs, a recent government watchdog report found.

In a Feb. 17 report, the Government Accountability Office criticized the Centers for Medicare & Medicaid Services for failing to align the two programs, which provide bonus money for physicians who implement the technology by a certain date and eventual Medicare penalties for those who don't. For example, the e-prescribing program does not require the use of the kind of certified technology that is required in the EMR meaningful use program, the GAO report states. Also, each program has different reporting criteria, which may confuse health care professionals.

"CMS recognizes that this duplication places additional burden on physicians, and we believe this duplication could affect the decision of physicians to adopt and use health information technology," the GAO report states. "However, CMS is still in the process of studying possible ways to address this duplication, and if the agency wants to eliminate the burden for providers in 2012, it would need to do so during its rulemaking."

The report highlights some of the biggest criticisms physicians have of the incentive programs. Although a 1% Medicare penalty for failing to use e-prescribing doesn't officially kick in until 2012, physicians must implement and use such a system at least 10 times between Jan. 1 and June 30, 2011, to avoid the pay cut, and at least 25 times by the end of 2011 to avoid a penalty in 2013. Physicians are prohibited from collecting bonuses in the same year from both the e-prescribing program and the meaningful use program, which launched this year.

The GAO report echoed many of the American Medical Association's concerns about the programs, said AMA Secretary Steven J. Stack, MD. Levying the 2012 penalty for not prescribing electronically by June 30 of this year is the most troubling aspect of the Medicare policy, he said.

"It is unacceptable that while physicians cannot receive incentives from both programs simultaneously, they will be slapped with a penalty if they decide to participate in one over the other," Dr. Stack said. "The unreasonable penalty policy in the e-prescribing program will force physicians to purchase stand-alone e-prescribing software just to avoid penalties -- software that most of them will end up discarding when they transition to a complete [electronic health record] system."

Kevin Berman, MD, a dermatologist at the Atlanta Center for Dermatologic Diseases, said that's exactly what his practice has been forced to do. In February, he and the other five physicians at the center began using a free, stand-alone e-prescribing system from a vendor.

"It's less efficient, but we want to make sure we will not get penalized by the government," Dr. Berman said.

When the practice is sure it has met Medicare's requirements to receive the e-prescribing bonuses, it will scrap the stand-alone system. The center plans to install a full-scale EMR system with e-prescribing capability within the next 18 months.

Although Dr. Berman's current stopgap solution is free, doctors at the practice report that e-prescribing isn't improving patient care and is affecting practice flow, he said. Physicians need to leave the exam room to access a computer and e-prescribe drugs. The efforts are sometimes wasted when a patient arrives at the pharmacy and finds no record of the order, he said.

The American College of Surgeons also considers the current six-month e-prescribing reporting period to be inappropriate. Most health professionals were unaware that the clock started ticking in January, and many will fail to report compliance in time to avoid the penalty next year, the college said.

Adoption of e-prescribing systems has been slow even with Medicare incentives, GAO reported. In 2009, only 8% of 600,000 eligible health care practitioners earned e-prescribing bonuses.

"The easy fix is to say we'll delay this penalty by one year," said Joseph Schneider, MD, chair of the Texas Medical Assn.'s health information technology committee. "The bureaucratic hassles undermine both programs."

E-prescribing as a concept does have advantages, such as reducing errors associated with transcribing orders and refill requests, said David Bragg, MD, senior vice president of medical informatics at HealthTexas in the Dallas-Fort Worth area. But physicians also find inefficiencies in current e-prescribing systems. For instance, e-prescribing a dozen medications for a Medicare patient with multiple chronic conditions can take several minutes, Dr. Bragg said.

Looking for regulatory relief

In December 2010, the AMA and several other medical organizations wrote a letter urging the Dept. of Health and Human Services to change the e-prescribing program. The department has yet to respond, and CMS officials have not indicated that any regulatory revisions are forthcoming.

The two programs don't match up because the e-prescribing program started before the meaningful use program was created as part of the 2009 federal stimulus package, CMS said in comments to the GAO. The e-prescribing program began paying out bonuses in 2009 and will continue through 2013, at which point it sunsets. Bonus payments for meaningful use began this year and will be available through 2015 or 2016, depending on the first year in which a practice adopts a system. Penalties for nonparticipation in the e-prescribing program will be levied between 2012 and 2014. Penalties for failing to adopt a certified EMR begin in 2015.

Physicians have another way to earn bonuses or incur penalties from a Medicare quality initiative. The Physician Quality Reporting System, passed in 2006, gives doctors incentive payments for reporting data on certain quality measures until 2014. Physicians not taking part will incur penalties starting in 2015.

Rep. Michael Burgess, MD (R, Texas), said he believed CMS is wrong to use 2011 claims as a basis to determine the 2012 e-prescribing penalty. He said the legislative goals of the two programs appear to compete against each other because of a "poor integration of policy," making it difficult for physicians to become compliant.

However, he ruled out a congressional fix to the problem, saying lawmakers are occupied with federal budget issues and other policy problems.

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The cost of noncompliance

Failure to participate in any of Medicare's three major quality initiatives will cost a physician over time in missed bonuses and payment reductions. All three programs have future penalties for noncompliance, but physicians cannot collect bonuses from all three in a given year.

E-prescribing Meaningful use Physician Quality Reporting System
Max bonus* Max penalty Max bonus* Max penalty Max bonus*** Max penalty
2011 1.0% none $18,000 none 1.0% none
2012 1.0% -1.0% $12,000 none 0.5% none
2013 0.5% -1.5% $8,000 none 0.5% none
2014 none -2.0% $4,000 none 0.5% none
2015 none none $2,000 -1.0% none -1.5%
2016 none none none -2.0% none -2.0%
2017 none none none -3.0% none -2.0%
2018 none none none -4.0%** none -2.0%
2019 and beyond none none none -5.0%** none -2.0%

* Physicians cannot claim Medicare bonuses for both EMR use and e-prescribing. Physicians also may receive maximum EMR bonuses over five years if they adopt by 2012.

** Penalties can rise above 3% if HHS determines less than 75% of doctors are using EMRs by 2018.

*** Physicians can receive an additional 0.5% in bonus years for completing certain maintenance-of-certification efforts.

Source: "Medicare EHR Incentive Program, Physician Quality Reporting System and e-Prescribing Comparison," Centers for Medicare & Medicaid Services, November 2010 (link)

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