If you have not yet met the requirements to avoid penalties, there is still time to do so, and some psychiatrists may qualify for an exemption.
Psychiatrists who have small practices and are concerned about whether the expense of transitioning to an electronic health records (EHR) system makes sense financially may want to know what kind of penalty they will incur if they decide not to move to electronic records or can’t show “meaningful use” of EHRs by October 1, 2014.
First, if you can qualify for one, there are hardship exemptions to the reimbursement deductions for not participating in the Medicare EHR program in the following categories:
Infrastructure: You must demonstrate that you live in an area without sufficient Internet access or where “insurmountable barriers” exist to obtaining the necessary infrastructure.
New practitioners: Newly practicing clinicians who have not had time to become meaningful users of EHRs can apply for a two-year exception to the payment adjustments. If you begin practice in 2015, you would receive an exemption to the penalties in 2015 and 2016, but would have to demonstrate meaningful use in 2016 to avoid the penalties in 2017.
Unforeseen circumstances: This would include natural disasters and other such unforeseeable events.
Patient interaction: This would include lack of face-to-face or telemedicine interaction with patients and/or lack of need to follow-up with patients.
Practice at multiple locations: This would require clinicians’ lack of control over the availability of certified EHR technology for more than 50 percent of patient encounters.
CMS will be posting information on how to apply for one of these hardship exemptions at http://www.cms.gov/Regulations-and-Guidance/Legislation/EHRIncentivePrograms/Downloads/PaymentAdj_HardshipExcepTipSheetforEP.pdf. The application process had not been posted at press time.
Here’s the bottom line on the penalties for Medicare providers who neither qualify for an exemption nor demonstrate that they are meaningful users of electronic health records by October 1, 2014.:
In 2015 there will be a 1 percent deduction to all Medicare reimbursements.
In 2016 there will be a 2 percent deduction to all Medicare reimbursements.
In 2017 and for each subsequent year, there will be a 3 percent deduction to all Medicare reimbursements.
If fewer than 75 percent of eligible providers have become meaningful users of EHRs by 2018, apparently Medicare will determine that the 3 percent penalty is not persuasive enough, and the penalty will increase by 1 percent each year to a maximum of 5 percent.
Although psychiatrists who failed to show meaningful use of electronic prescribing (ERx) by June 2013 will also receive a 1 percent penalty for this in 2015, thereafter the ERx penalty will be subsumed by the EHR penalty. (In 2014, before the EHR deduction goes into effect, the deduction for failing to use ERx is 2 percent.) What this means is that in 2015 a psychiatrist who sees Medicare patients and has failed to show meaningful use of ERx and EHRs will receive 98 percent of the Medicare reimbursement for his/her claims (1 percent deduction for ERx and 1 percent for EHRs); the deduction will remain the same in 2016, when the EHR deduction increases to 2 percent, but the ERx deduction disappears. ■
Ellen Jaffe is a Medicare specialist in APA’s Office of Healthcare Systems and Financing..
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