Medicare Electronic Prescribing Penalty Program

AAFP, Other Physician Organizations Slam HHS, CMS for Policy Change

December 21, 2010 05:10 pm News Staff

The AAFP has joined the AMA and more than four dozen national physician specialty organizations -- as well as medical associations from every state and the District of Columbia -- in urging HHS to put pressure on CMS to revise its electronic prescribing, or e-prescribing, penalty criteria, which are scheduled to be implemented Jan. 1.

According to those criteria, which only recently were published in the final 2011 Medicare physician fee schedule, beginning in 2012, CMS will penalize physicians who did not send Medicare prescriptions electronically in the first six months of 2011. However, up until now, the agency's message has been that physicians who were not e-prescribing by 2012 would face a 1 percent reduction in their Medicare allowed charges in 2012 and 2013.

The medical organizations clearly interpret the phrase "by 2012" differently than does the government agency.

"We strongly oppose basing the 2012 and 2013 e-prescribing penalties on e-prescribing activity that occurs during 2011," says the Dec. 7 letter to HHS Secretary Kathleen Sebelius.

A big issue is CMS' governance of more than one Medicare incentive program. Notably, CMS has ruled that physicians who choose to participate in the Medicare electronic health record, or EHR, incentive program cannot participate in Medicare's e-prescribing incentive program in the same program year.

Because of that restriction and the way the incentive programs are designed, physicians can participate in only one of the two programs in 2011, 2012 and 2013, says the letter. Therefore, many physicians have decided to forgo the e-prescribing incentive program in favor of the EHR incentive program.

"Now, at the eleventh hour … CMS has significantly changed its policy and decided to penalize physicians who choose to only take part in the Medicare EHR incentive program," says the letter. The parameters of that program don't necessarily require e-prescribing in 2011.

Furthermore, those same physicians who face penalties will implement comprehensive EHRs within the next few years that do much more "than just enable e-prescribing," the letter continues.

The organizations argue that CMS' "sudden change" in program requirements -- changes that take effect on Jan. 1 -- does not allow enough time to educate physicians on the need for them to take part in the 2011 e-prescribing incentive program to avoid e-prescribing penalties in 2012 and 2013.

Furthermore, says the letter, "such a significant last-minute policy change could substantially hurt the overall move to e-prescribing and EHR adoption."

"Financial penalties should only be levied in 2012 and 2013 against Medicare-eligible physicians who fail to qualify for an exemption and fail to e-prescribe 10 permissible prescriptions by the end of 2012 or the end of 2013," says the letter.

The letter also points out the law that established the Medicare e-prescribing program, the Medicare Improvements for Patients and Providers Act of 2008(, clearly supports delaying penalties against physicians who do not e-prescribe in 2012.

The organizations say they "strongly oppose" basing the 2012 and 2013 e-prescribing penalties on e-prescribing activity that occurs during 2011. In the event CMS won't budge on the matter, the letter further asks CMS to immediately act to

  • extend the e-prescribing reporting period to 10 months -- from Jan. 1, 2011, to Oct. 31, 2011 -- rather than the six months currently proposed, and
  • add more exemptions from e-prescribing penalties in 2012 by allowing, for example, physicians who attest to meaningful use in 2011 or 2012 to be exempt from such penalties.

"These immediate steps will allow CMS and others more time to educate physicians on the e-prescribing penalty program and to come up with better solutions," says the letter.