EHR incentive payment – Medicaid final rule

 The final rule:

•  Specifies payment amounts, the basis for payments, and the process for making payments including that there must be no duplication with Medicare for EPs; EPs can receive up to $63,750; pediatricians with more than 20 percent, but less than 30 percent Medicaid patient volume will receive two-thirds of the maximum amount; and hospital payments are based on a formula outlined in the statute;
• Aligns with the Medicare incentive program, where possible.   This includes allowing states to initiate their programs as early as January 2011.
• Finalizes the maximum incentive payments introduced in the statute, verified through analysis of studies on the average allowable cost of EHR technology undertaken by the Secretary;
• Requires states to verify the eligibility and disburse payments to Medicaid eligible providers;
• Specifies that while some eligible hospitals may receive incentives from Medicare and Medicaid, EPs must select one program.   Furthermore, Medicaid EPs and hospitals must select one state from which to receive their incentive in each year.
• Specifies that states must have a system capable of coordinating with a national database to verify provider eligibility, identity, collect certain data, etc.   This system must coordinate and/or make payments.

   For hospital payments, the calculation is:

    (Overall EHR Amount) * (Medicaid Share)

                          or

                Overall EHR Amount

                          Equals

{Sum over 4 year of [(Base Amount Plus Discharge Related Amount Applicable for Each Year) * Transition Factor Applicable for Each Year]} *

                  Medicaid Share

                       Equals

{(Medicaid inpatient-bed-days + Medicaid managed care inpatient-bed-days) divided by [(total inpatient-bed days) times (estimated total charges minus charity care charges) divided by (estimated total charges)]}