EHR Primer: Get the Basics

Knowing the challenges can help with implementation and orientation to a new system.

By Janice G. Jacobs, CPA, CPC, CCS

Electronic health records (EHRs) are electronic versions of a patient’s medical history as maintained by a physician or other health care provider. EHRs contain elements such as patient information, past medical, family and social history, clinical notes, prescriptions, and diagnostic testing results. These records are accessible to other health care providers and serve as a legal record of everything that happened to a patient during a specific encounter. EHR adoption is key to the current administration’s health strategy. If you are confused about what’s happening, here’s a primer.

Taking the Next Step in Health Care Data

The Centers for Medicare & Medicaid Services (CMS), Electronic Health Records, Overview (www.cms.hhs.gov/ehealthrecords/) says, “EHRs are the inevitable next step in the continued progress of health care that can strengthen the relationship between patients and clinicians. The data, and the timeliness and availability of it, will enable providers to make better decisions and provide better care.”

Examples of how EHRs can improve patient care include the following:

  •  Reducing incidence of medical error by improving the accuracy and clarity of medical records.
  • Making the health information available.
  • Reducing duplication of tests.
  • Decreasing treatment delays.

The government is uncovering and addressing implementation issues through a series of demonstration projects prior to the 2014 projected nationwide rollout. CMS is engaged in a five-year EHR demonstration project, which began on June 1, 2009 and is anticipated to continue through May 21, 2014 (found at CMS, Medicare Demonstrations, Details for Electronic Health Records Demonstration:www.cms.hhs.gov/DemoProjectsEvalRpts/MD/itemdetail.asp?itemID=CMS1204776). 

The goal of the demonstration is “to foster the implementation and adoption of EHRs and health information technology (HIT) more broadly as effective vehicles to improve the quality of care provided and transform the way medicine is practiced and delivered … The demonstration is designed to leverage the combined forces of private and public payers to drive physician practices to widespread adoption and use of EHRs,” (CMS, Medicare Demonstrations, Details for Electronic Health Records Demonstration). The demonstration provides incentives to participating primary care physician practices fulfilling established criteria and serves as an operational outline for practices across the country in relation to infrastructure, physician education, tracking and reporting quality measures, and community outreach.

Increase Financial Benefits with Early Implementation

In February 2009, President Obama signed the American Reinvestment and Recovery Act (ARRA, or stimulus act), which included the Health Information Technology for Economic and Clinical Health (HITECH) Act. HITECH includes more than $19 billion used to increase EHR use nationwide. Under the stimulus plan, physicians can qualify for $44,000 in Medicare incentives if they demonstrate “meaningful use” of an EHR starting in 2011. High-volume Medicaid providers can be eligible for up to $20,000 more in incentives, for a maximum incentive of $64,000. Physicians in health professional shortage areas (HPSA) are eligible for an additional 10 percent incentive.

Specific criteria must be met before a provider is eligible for stimulus payments. The two most important criteria require that (1) the EHR must be a “qualified” EHR and (2) the provider must demonstrate “meaningful use.”

To be considered qualified, an EHR must:

  • Include patient demographic and clinical health information.
  • Have the capacity to provide clinical decision support.
  • Support physician order entry.
  • Capture and query information relevant to health care quality.
  • Be able to exchange electronic health information and integrate information from other sources.               

The definition of meaningful use is muddy and will be clarified further by the Health IT Policy Committee. Meaningful use most likely will involve consistent use of the EHR for prescribing, electronic exchange of health information between clinical organizations, and the submission of information on selected quality measures. A provider who purchases an EHR system but fails to use it would be disqualified from stimulus eligibility. Stimulus funds are distributed per provider number rather than to individual physicians; meaning, if a group of five doctors operating under one provider number purchases a qualified EHR system and demonstrates meaningful use, the practice will be eligible for up to $44,000. Each physician will not receive his or her own stimulus payment and the practice, as a whole, must demonstrate meaningful use. One physician acting as the champion in regard to technology, who spearheads the EHR project but is the only meaningful user of the EHR system, would not qualify the entire practice for the incentive.

Stimulus payments will be staggered over a five-year implementation period: $15,000 (year one), $12,000 (year two), $8,000 (year three), $4,000 (year four), $2,000 (year five), and $0 for subsequent years. To be eligible for the full amount, the EHR system must be up and running by Jan. 1, 2011 to demonstrate meaningful use by 2012, when incentive payments will begin. Practices that have adopted a qualified EHR system prior to Jan. 1, 2011 also will be eligible for the incentive payments. Meaningful users who have systems up and running in 2011 and 2012 will receive an increased first year payment of $18,000. Practices implementing a qualified EHR after 2011 will be eligible only for that year’s payments. For example, if a practice is up and running in 2011/2012, they will get year one’s payment and payments each subsequent year for five years. A practice that implements an EHR in 2013 will start receiving the reduced year two payment and receive payments each subsequent year for four years.

Incur Financial Penalties with Late Adoption

The biggest obstacle in implementing EHRs in private and group practices is cost. With the financial incentive program, expense should be less of an issue for physician practices to adopt a functional EHR. In an ongoing effort for full compliance, further negative incentives will be implemented after the demonstration project is over. Beginning in 2015, penalties (reduced fee schedule payments) will be assessed for providers that are not meaningful users of a qualified EHR system. The penalty will increase each subsequent year of noncompliance, to as much as 5 percent by 2018.

Weigh the Impact on Patient Care and Finances

As a result, every practice should assess its specific needs for a qualified EHR system. It is imperative to work with the business office or central business office in cases of large group practices with many locations. The new EHR system will not provide return on investment if it does not interface with the existing billing and accounts receivable system. Practice managers and clinicians need to consult with the billing and accounts receivable (BAR) office about evaluating vendors to achieve optimal interoperability between systems and offices. Failure to include the front and back ends of the revenue cycle will result in significant cash flow problems during implementation.

Your physicians also will need sufficient preparation to become acclimated to a new system, so there will be limited impact on the number of patients seen in a day with no adverse effects on patient care quality. Careful planning is necessary to implement the EHR system gradually, starting with the clinical data first, and then moving to implementation of the billing system where encounter form data is entered. If care quality and billable hours are affected substantially because a physician is spending excessive time in front of a computer keying in data, there will be a negative return on investment.

Computerizing the nation’s health records as part of the economic stimulus plan has resulted in mixed emotions. Although providers agree that quality of patient care quality will increase with EHRs, they are faced with the challenges of implementation and orientation to a new system. With the topic of EHRs on the CMS agenda since the early 90s, it’s still a top priority as CMS moves forward with the EHR demonstration project as part of their value-driven health care initiative. As the President designates funds and resources to fulfill the goal of Americans having access to a secure, interoperable health record by 2014,analyzing your practice’s current capacity and resources for implementing EHR is critical to your five-year strategic plan.

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