Do You Qualify for a $63,750 Medicaid EHR Bonus?

A new report estimates that as many as 45,000 office-based physicians who participate in Medicaid and use electronic health records, or EHRs, could collect as much as $63,750 paid out over a six-year period as part of the American Recovery and Reinvestment Act of 2009.

Notably, about 9,800 primary care physicians -- defined by report authors as family physicians, internists and general practitioners -- could qualify for the bonuses.

Boosting Health Information Technology in Medicaid: The Potential Effect of the American Recovery and Reinvestment Act (14-page PDF; About PDFs) was issued by the Geiger Gibson/RCHN Community Health Foundation Research Collaborative, an arm of George Washington University's School of Public Health and Health Services in Washington.

The report provides insight into federal EHR funding efforts, according to Leighton Ku, Ph.D., M.P.H., professor of health policy at George Washington University and one of four report authors. He said the team wanted to research the little-explored Medicaid payout because it pays significantly more money than the $44,000 maximum provided by a similar Medicare program.

Ku noted that HHS' bonus payment rules prevent "double dipping" from the Medicare and Medicaid programs. But "If you're eligible for both (programs)," said Ku, "you're probably better off taking the Medicaid money."

HHS is anxious to expedite EHR implementation and is investing $49 billion in the two programs to help ensure that 40 percent of America's physicians are up to speed with health information technology, or health IT, by 2012.

That goal may be difficult to attain. According to 2006 data from the National Ambulatory Medical Care Survey, only 15 percent of U.S. physicians have fully implemented EHRs; another 16 percent have begun the implementation process, and 69 percent do not use an EHR system.

To receive the Medicaid bonus, physicians must meet criteria beyond using a certified EHR. For example, to qualify for the full bonus, at least 30 percent of a physician's patient panel must be enrolled in Medicaid.

Physicians who practice in federally qualified health centers or rural health clinics have less stringent criteria -- they need only claim that 30 percent of their patients are "needy individuals." As such, the patients must be covered by Medicaid, provided with free care or billed on a sliding-fee scale.

The authors point out that "after-the-fact debt forgiveness is not sufficient to classify a provider as one who serves 'needy' patients who are uncovered by Medicaid."

Also of note, eligible Medicaid physicians will be able to collect $21,250 at the program's start in 2011 to cover the cost of purchasing or upgrading health information technology, including training and other support services. Physicians who demonstrate "meaningful use" can earn an additional $8,500 annually for the subsequent five years.

The definition of meaningful use is under discussion and should be finalized by year's end.

On the other hand, the Medicare bonus program rewards early EHR adopters, but it then grants smaller incentive payouts each year and imposes penalties on physicians who don't implement a certified EHR by the end of 2015.

Researchers also determined that a good number of the nation's community health centers would qualify for the EHR payments because they serve so many low-income patients. They found that in 39 states, 100 percent of health centers would qualify for EHR bonuses, as would 90 percent of community health centers in most of the remaining states.

Ku said that family physicians' commitment to staffing the nation's community health centers would add many thousands more FPs to the ranks of physicians eligible for EHR bonuses. "Without family physicians, the nation's community health centers just couldn't operate," he said.

According to the report, the federal government faces serious challenges if it is to achieve widespread EHR implementation by America's physicians. To succeed, the government must

Ku said the federal government is headed in the right direction with the EHR bonus programs. However, he added, lawmakers never expected the health IT subsidies to cover the full cost of purchasing and maintaining physicians' EHRs. He drew a parallel between HHS' health IT bonus programs and Washington's highly publicized "cash for clunkers" automobile buy-back program.

The money available to consumers "won't buy a whole new car, but it goes a long way toward making the purchase affordable," Ku said.