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From Health Law Daily, March 23, 2015

Stage 3 of Electronic Health Record Incentive Program proposed

By Harold M. Bishop, J.D.

The requirements that eligible professionals (EPs), eligible hospitals, and critical access hospitals (CAHs) must achieve in order to meet meaningful use of electronic health records, qualify for incentive payments under the Medicare and Medicaid Electronic Health Record (EHR) Incentive Programs, and avoid downward payment adjustments under Medicare have been proposed by CMS and issued as an advance release of a Proposed Rule.

Stage 3 is expected to be the final stage of the EHR incentive programs. The Stage 3 Proposed Rule would: (1) continue to encourage electronic submission of clinical quality measure (CQM) data for all providers where feasible in 2017; (2) require the electronic submission of CQMs where feasible in 2018; (3) establish requirements to transition the program to a single stage for meaningful use; and (4) change the EHR reporting period so that all providers would report under a full calendar year timeline with a limited exception under the Medicaid EHR Incentive Program for providers demonstrating meaningful use for the first time.

Background. The American Recovery and Reinvestment Act of 2009 (ARRA) (P. L. 111–5) amended Titles XVIII and XIX of the Social Security Act to authorize incentive payments to EPs, eligible hospitals, and CAHs, and Medicare Advantage organizations to promote the adoption and meaningful use of Certified Electronic Health Record Technology (CEHRT).

The EHR Incentive Programs consist of three stages of meaningful use. Each stage has its own set of requirements to meet in order to demonstrate meaningful use.

Stage 1. The Stage 1 Final rule (75 FR 44314, July 28, 2010) set the foundation for the Medicare and Medicaid EHR Incentive Programs by establishing requirements for the electronic capture of clinical data and providing patients with electronic copies of their health information. The Final rule outlined Stage 1 meaningful use criteria, and finalized core and menu objectives for EPs, eligible hospitals, and CAHs.

Stage 2. In the Stage 2 Final rule (77 FR 53968, September 4, 2012), CMS focused on the exchange of essential health data among health care providers and patients to improve care coordination. Stage 2:

  • maintained the same core-menu structure for several finalized Stage 1 core and menu objectives;

  • finalized that EPs must meet the measure for or qualify for an exclusion to 17 core objectives and 3 of 6 menu objectives;

  • finalized that eligible hospitals and CAHs must meet the measure or qualify for an exclusion to 16 core objectives and 3 of 6 menu objectives;

  • combined several Stage 1 measures included into Stage 2;

  • increased functional objective measure thresholds in Stage 2 to increase efficiency, effectiveness, and flexibility; and

  • finalized a set of CQMs for all providers participating in any stage of the program to report to CMS beginning in 2014.

Stage 3. The Stage 3 Proposed rule builds on the Stage 1 and Stage 2 final rules, including the Stage 2 goal of increasing interoperable health data sharing among providers. The Stage 3 Proposed rule also focuses on the advanced use of EHR technology to promote improved patient outcomes and health information exchange. CMS also proposes to continue improving program efficiency, effectiveness, and flexibility by making changes to the Medicare and Medicaid EHR Incentive Programs that simplify reporting requirements and reduce program complexity. One significant change includes establishing a single set of objectives and measures to meet the definition of meaningful use. This new definition of meaningful use would be optional for any provider (EP, eligible hospital, or CAH) who chooses to attest to these objectives and measures for an EHR reporting period in 2017; and would be required for all eligible providers in 2018 and subsequent years.

The Stage 3 Proposed rule also would further support efforts to align the EHR Incentive Programs with other CMS quality reporting programs that use certified EHR technology, such as the Hospital Inpatient Quality Reporting (IQR) and Physician Quality Reporting System (PQRS) programs, as well as continue alignment across care settings for providers demonstrating meaningful use. This alignment would both reduce provider burden associated with reporting on multiple CMS programs and enhance CMS operational efficiency.

Meaningful use requirements for 2017 and forward. Under the Stage 3 Proposed rule, with the exception of Medicaid providers in their first year of demonstrating meaningful use, all providers (EPs, eligible hospitals, and CAHs) would report on a calendar year EHR reporting period beginning in calendar year 2017; previously, EPs reported on each calendar year and eligible hospitals and CAHs reported on each fiscal year. This proposal builds on efforts to align the EHR reporting period with reporting periods for other quality reporting programs identified in the Stage 2 Final rule and the fiscal year 2015 Hospital Inpatient Prospective Payment Systems (IPPS) final rule. In addition, all providers, other than Medicaid EPs and eligible hospitals demonstrating meaningful use for the first time, would be required to attest based on a full year of data for a single set of meaningful use objectives and measures to demonstrate Stage 3 of meaningful use, which is proposed as optional for an EHR reporting period in 2017, and mandatory for an EHR reporting period in 2018 and subsequent years.

CMS’ selection of the proposed Stage 3 objectives and measures for the Medicare and Medicaid EHR Incentive Programs included: (1) review attestation data for Stages 1 and 2 of meaningful use; (2) listening sessions and interviews with providers, EHR system developers, regional extension centers, and health care provider associations; and (3) review recommendations from government agencies and advisory committees focused on health care improvement. Based on this analysis, CMS is proposing a set of 8 objectives with associated measures designed to: (1) align with national health care quality improvement efforts; (2) promote interoperability and health information exchange; and (3) focus on the three-part aim of reducing cost, improving access, and improving quality.

Measures in the Stage 1 and Stage 2 Final rules that included paper-based workflows, chart abstraction, or other manual actions would be removed or transitioned to an electronic format utilizing EHR functionality for Stage 3. In addition, CMS is proposing the removal of measures that are no longer useful in gauging performance, in order to reduce the reporting burden on providers for measures already achieving widespread adoption.

Clinical quality measurement. Because EPs, eligible hospitals, and CAHs must report CQMs in order to qualify for incentive payments and avoid downward payment adjustments under Medicare, CMS is committed to: (1) continuing the electronic calculation and reporting of key clinical data through the use of CQMs; and (2) improving alignment of reporting requirements, maintaining flexibility with reporting requirements while streamlining reporting mechanisms for providers, and increasing quality data integrity.

To facilitate continuous quality improvement, CMS needs a method to allow changes to meaningful use CQMs and the associated reporting requirements on an ongoing basis. As a result, CMS intends to further support alignment between the Medicare and Medicaid EHR Incentive Programs and other CMS quality reporting programs, such as PQRS and Hospital IQR, by including the reporting requirements for CQMs for providers demonstrating meaningful use in future rulemaking.

Payment adjustments and hardship exceptions. Medicare payment adjustments begin in 2015. For the Stage 3 Proposed rule, CMS proposes to maintain all payment adjustment provisions for all EPs, eligible hospitals, and CAHs finalized in the Stage 2 Final rule except for a change to the relationship between the EHR reporting period year and the payment adjustment year for CAHs. CMS is proposing a change to the timing of the EHR reporting period and related deadlines for attestations and hardship exceptions for CAHs in relation to the payment adjustment year, in order to accommodate a transition to EHR reporting for meaningful use on the calendar instead of the fiscal year timeline.

The payment adjustment provisions being maintained in the Stage 3 Proposed rule include the process finalized in Stage 2 by which a prior EHR reporting period determines a payment adjustment. CMS is also maintaining the four categories of exceptions based on all of the following: (1) the lack of availability of internet access or barriers to obtaining IT infrastructure; (2) a time-limited exception for newly practicing EPs or new hospitals that would not otherwise be able to avoid payment adjustments; (3) unforeseen circumstances such as natural disasters; and (4) for EPs only, exceptions due to a combination of clinical features limiting a provider's interaction with patients or, if the EP practices at multiple locations, lack of control over the availability of CEHRT at practice locations constituting 50 percent or more of their encounters.

Modifications. For the Stage 3 Proposed rule, CMS proposes that under the proposed changes to EHR reporting periods that would begin in 2017, Medicaid EPs and eligible hospitals demonstrating meaningful use for the first time would be required to attest for an EHR reporting period of any continuous 90-day period in the calendar year for purposes of receiving an incentive, as well as avoiding the payment adjustment. CMS would continue to allow states to set up a CQM submission process that Medicaid EPs and eligible hospitals may use to report on CQMs for 2017 and subsequent years. CMS also proposes amendments to state reporting on providers who are participating in the Medicaid EHR Incentive Program as well as state reporting on implementation and oversight activities.

The Stage 3 Proposed rule will be published in the Federal Register on March 30, 2015. Comments may be issued through May 29, 2015.

MainStory: TopStory ReimbursementNews IPPSNews CoPNews CAHNews EHRNews HITNews HIPAANews MedicaidPaymentNews PaymentNews QualityNews

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