Bringing Sense to Health Information Technology Investment

The Premier hospital alliance is distributing some important information regarding the “meaningful use” rules that will govern the distribution of federal funds intended to encourage investment in health information technology systems.

The problem with the regulation as written is that it penalizes some hospital systems that have multiple campuses.  Under the rule, a hospital system that has facilities operating under different Medicare provider numbers can receive a separate payment for each facility.  However, a multi-campus system with a single Medicare provider number can only receive one incentive payment. 

Legislation has been introduced to correct this problem, and it deserves support.  To learn more about this issue, please read the Premier communiqué below:

EHR inequity must be fixed

Lawmakers are calling for critical changes to the final rule defining “meaningful use (MU)” of electronic health records (EHRs) to ensure that every eligible hospital receives the same federal incentive payments. As finalized on July 28, the rule would allow only one Medicare incentive base payment per year for multiple inpatient facilities operating under the same Medicare provider number. By contrast, an identical hospital whose inpatient facilities each operate under their own Medicare provider number would receive a base payment for each facility. This has created an arbitrary and inequitable distinction between identical hospital systems based solely on whether a system has multiple inpatient facilities operating under a single Medicare provider number. The Electronic Health Record Incentives for Multi-campus Hospitals Act (H.R. 6072 and S. 3708) would allow multi-campus hospitals to choose one of two incentive calculations that would best meet the needs of their institutions and communities.

Failure to revise this policy will harm many hospitals’ ability to achieve improvements to patient care enabled by EHRs 

•      Bon Secours Health System—with nonprofit hospitals serving patients in Florida, Kentucky, Maryland, New York, Pennsylvania, South Carolina and Virginia—estimates that it will initially cost $11 million to furnish each of its inpatient facilities with EHR technology. Because two of its inpatient facilities share a common provider number, Bon Secours estimates that it will lose approximately $1.8 million in potential reimbursement based on the final MU regulations’ treatment of multi-campus hospitals.   

•      Adventist Health/West recently merged the operations of Selma Community Hospital in Selma, CA, into the Medicare provider number for the Hanford Community Medical Center in Hanford, CA. While these facilities serve two distinct towns, the rule finalized by CMS for the payment of EHR incentives recognizes only one location for purposes of calculating the HIT base incentive payment.

•      Carolinas HealthCare System (CHS), with 32 affiliated hospitals in North and South Carolina, has determined the multi-campus policy will reduce available funding by a minimum of $2 million for its owned inpatient facilities, and an additional $6 million for its managed affiliate hospitals. The per-facility EHR and associated HIT costs that will be incurred for these inpatient facilities will be shared among other eligible CHS facilities, thereby reducing their available financial resources intended to speed adoption.

•      SSM Health Care is actively involved in a multi-year, $350+ million project to use EHRs at all of its hospitals in Illinois, Missouri, Oklahoma and Wisconsin. SSM Cardinal Glennon Children’s Medical Center and St. Mary’s Health Center in the St. Louis area operate under a common provider number. St. Anthony Hospital and Bone & Joint Hospital in Oklahoma City also operate under a common provider number. Not receiving the base payments for each of these hospitals will pose a serious challenge to SSM’s efforts to adopt EHRs.

•      As an integrated delivery system in Ohio, Summa Health System currently has multiple inpatient facilities operating under one provider number. Summa will, therefore, not receive millions of dollars in EHR incentive payments that are reasonably due to their organization that would serve to advance its patient quality and safety processes and produce system efficiencies.

The Premier healthcare alliance urges members of Congress to cosponsor this important legislation and to press for the bill’s passage before the end of the Congress

•      Introduced by Representatives Zachary Space (D-OH), Michael Burgess (R-TX) and Senator Charles Schumer (D-NY), the Electronic Health Record Incentives for Multi-campus Hospitals Act would recognize the incremental acquisition, training and implementation costs multi-system hospitals face when adopting EHR systems. The bill would give multi-campus hospitals the choice of either a base payment for each campus, but only one per-discharge amount, or additional per-discharge amounts for each campus, but only one base payment.

•      Because multi-campus hospitals will incur separate EHR costs for each inpatient facility, there is no logical reason to limit base payments in this way.   

•      The Premier healthcare alliance believes this “one size fits all” approach unfairly penalizes co-located and multi-campus hospitals and could significantly cut into payments these facilities need to successfully deploy EHRs.

 •      The legislation has garnered bipartisan support from leaders on the Ways and Means and Energy and Commerce Committees, including Sander Levin (D-MI), Pete Stark (D-CA), Henry Waxman (D-CA), John Dingell (D-MI) and Frank Pallone (D-NJ), as well as more than 26 other members of these committees.