Daily Rules, Proposed Rules, and Notices of the Federal Government
In this final rule the Secretary of the Department of Health and Human Services (the Secretary) will specify Stage 2 criteria beginning in 2014 that eligible professionals (EPs), eligible hospitals, and critical access hospitals (CAHs) must meet in order to qualify for an incentive payment, as well as introduce changes to the program timeline and detail Medicare payment adjustments. Recommendations on Stage 2 criteria from the Health IT
The American Recovery and Reinvestment Act of 2009 (ARRA) (Pub. L. 111-5) amended Titles XVIII and XIX of the Social Security Act (the Act) to authorize incentive payments to EPs, eligible hospitals, and CAHs, and Medicare Advantage (MA) organizations to promote the adoption and meaningful use of CEHRT.
Sections 1848(o), 1853(l) and (m), 1886(n), and 1814(l) of the Act provide the statutory basis for the Medicare incentive payments made to meaningful EHR users. These statutory provisions govern EPs, Medicare Advantage (MA) organizations (for certain qualifying EPs and hospitals that meaningfully use CEHRT), subsection (d) hospitals and critical access hospitals (CAHs) respectively. Sections 1848(a)(7), 1853(l) and (m), 1886(b)(3)(B), and 1814(l) of the Act also establish downward payment adjustments, beginning with calendar or fiscal year 2015, for EPs, MA organizations, subsection (d) hospitals and CAHs that are not meaningful users of CEHRT for certain associated reporting periods.
Sections 1903(a)(3)(F) and 1903(t) of the Act provide the statutory basis for Medicaid incentive payments. (There are no payment adjustments under Medicaid). For a more detailed explanation of the statutory basis for the EHR incentive payments, see the Stage 1 final rule (75 FR 44316 through 44317).
In the Stage 1 final rule we outlined Stage 1 meaningful use criteria, we finalized a separate set of core objectives and menu objectives for EPs, eligible hospitals and CAHs. EPs and hospitals must meet the measure or qualify for an exclusion to all 15 core objectives and 5 out of the 10 menu objectives in order to qualify for an EHR incentive payment. In this final rule, we maintain the same core-menu structure for the program for Stage 2. We are finalizing that EPs must meet the measure or qualify for an exclusion to 17 core objectives and 3 of 6 menu objectives. We are finalizing that eligible hospitals and CAHs must meet the measure or qualify for an exclusion to 16 core objectives and 3 of 6 menu objectives. Nearly all of the Stage 1 core and menu objectives are retained for Stage 2. The “exchange of key clinical information” core objective from Stage 1 was re-evaluated in favor of a more robust “transitions of care” core objective in Stage 2, and the “Provide patients with an electronic copy of their health information” objective was removed because it was replaced by a “view online, download, and transmit” core objective. There are also multiple Stage 1 objectives that were combined into more unified Stage 2 objectives, with a subsequent rise in the measure threshold that providers must achieve for each objective that has been retained from Stage 1.
EPs, eligible hospitals, and CAHs are required to report on specified clinical quality measures in order to qualify for incentive payments under the Medicare and Medicaid EHR Incentive Programs. This final rule outlines a process by which EPs, eligible hospitals, and CAHs will submit CQM data electronically, reducing the associated burden of reporting on quality measures for providers. EPs will submit 9 CQMs from at least 3 of the National Quality Strategy domains out of a potential list of 64 CQMs across 6 domains. We are recommending a core set of 9 CQMs focusing on adult populations with a particular focus on controlling blood pressure. We are also recommending a core set of 9 CQMs for pediatric populations. EPs should report on these recommended CQMs if they are representative of their clinical practice and patient population. Eligible hospitals and CAHs will submit 16 CQMs from at least 3 of the National Quality Strategy domains out of a potential list of 29 CQMs across 6 domains. For the Medicare EHR Incentive Program, EPs, eligible hospitals, and CAHs in their first year of demonstrating meaningful use must submit their CQM data via attestation, and those beyond their first year must submit their CQM data electronically via a CMS-designated transmission method. For EPs, this includes an aggregate electronic submission or a patient-level electronic submission through the method specified by the Physician Quality Reporting System (PQRS) that would provide one submission for credit in both the PQRS and Medicare EHR Incentive Program. For eligible hospitals and CAHs, this includes an aggregate electronic submission or a patient-level data submission through the method similar to the Medicare EHR Incentive Program Electronic Reporting Pilot, which is proposed for extension in the CY 2013 Hospital Outpatient Prospective Payment System (OPPS) proposed rule (July 30, 2012, 77 FR 45188). For electronic submissions, patient-level data must be submitted using the Quality Reporting Data Architecture (QRDA) Category I format, and aggregate-level data must be submitted using the QRDA Category III format.
Medicare payment adjustments are required by statute to take effect in 2015. We are finalizing a process by which payment adjustments will be determined by a prior reporting period. Therefore, we specify that EPs and eligible hospitals that are meaningful EHR users in 2013 will avoid payment adjustment in 2015. Also, if such providers first meet meaningful use in 2014, they will avoid the 2015 payment adjustment, if they are able to demonstrate meaningful use at least 3 months prior to the end of the calendar (for EPs) or fiscal year (for eligible hospitals) and meet the registration and attestation requirement by July 1, 2014 (for eligible hospitals) or October 1, 2014 (for EPs).
We also are finalizing exceptions to these payment adjustments. This final rule outlines four categories of exceptions based on (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 will not otherwise be able to avoid payment adjustments; (3) unforeseen circumstances such as natural disasters that will be handled on a case-by-case basis; and (4) (EP only) exceptions due to a combination of clinical features
We are expanding the definition of what constitutes a Medicaid patient encounter, which is a required eligibility threshold for the Medicaid EHR Incentive Programs. We include encounters for individuals enrolled in a Medicaid program, including Title XXI-funded Medicaid expansion encounters (but not separate Children's Health Insurance Programs (CHIPs)). We also specify flexibility in the lookback period for patient volume to be over the 12 months preceding attestation, not tied to the prior calendar year.
We are also making eligible approximately 12 additional children's hospitals that have not been able to participate to date, despite meeting all other eligibility criteria, because they do not have a CMS Certification Number since they do not bill Medicare.
These changes would take effect beginning with payment year 2013.
Lastly, we are finalizing a delay in the implementation of the onset of Stage 2 criteria. In the Stage 1 final rule, we established that any provider who first attested to Stage 1 criteria in 2011 would begin using Stage 2 criteria in 2013. This final rule delays the onset of those Stage 2 criteria until 2014, which we believe provides the needed time for vendors to develop CEHRT. We are also introducing a special 3-month EHR reporting period, rather than a full year of reporting, for providers attesting to either Stage 1 or Stage 2 in 2014 in order to allow time for providers to implement newly certified CEHRT. In future years, providers who are not in their initial year of demonstrating meaningful use must meet criteria for 12-month reporting periods. The 3-month reporting period allows providers flexibility in their first year of meeting Stage 2 without warranting any delay for Stage 3. This policy is consistent with CMS's commitment to ensure that Stage 3 occurs on schedule (implemented by 2016).
This final rule is anticipated to have an annual effect on the economy of $100 million or more, making it an economically significant rule under the Executive Order and a major rule under the Congressional Review Act. Accordingly, we have prepared a Regulatory Impact Analysis that to the best of our ability presents the costs and benefits of the final rule. The total Federal cost of the Medicare and Medicaid EHR Incentive Programs between 2014 and 2019 is estimated to be $15.4 billion (these estimates include net payment adjustments for Medicare providers who do not achieve meaningful use in 2015 and subsequent years in the amount of $2.1 billion). In this final rule we have not quantified the overall benefits to the industry, nor to EPs, eligible hospitals, or CAHs participating in the Medicare and Medicaid EHR Incentive Programs. Information on the costs and benefits of adopting systems specifically meeting the requirements for the EHR Incentive Programs has not yet been collected and information on costs and benefits overall is limited. Nonetheless, we believe there are substantial benefits that can be obtained by eligible hospitals and EPs, including reductions in medical recordkeeping costs, reductions in repeat tests, decreases in length of stay, increased patient safety, and reduced medical errors. There is evidence to support the cost-saving benefits anticipated from wider adoption of EHRs.
The American Recovery and Reinvestment Act of 2009 (ARRA) (Pub. L. 111-5) amended Titles XVIII and XIX of the Social Security Act (the Act) to authorize incentive payments to EPs, eligible hospitals, and CAHs, and Medicare Advantage (MA) Organizations to promote the adoption and meaningful use of CEHRT. In the July 28, 2010
For Stage 1, CMS and the Office of the National Coordinator for Health Information Technology (ONC) worked closely to ensure that the definition of meaningful use of CEHRT and the standards and certification criteria for CEHRT were coordinated. Current ONC regulations may be found at 45 CFR part 170.
For Stage 2, CMS and ONC again worked together to align our regulations.
In the March 7, 2012
In the April 18, 2012
Simultaneously in the March 7, 2012
We urge those interested in this final rule to also review the ONC final rule on standards and implementation specifications for CEHRT. Readers may also visit
We received approximately 6,100 items of timely correspondence in response to our Stage 2 proposed rule published in the March 7, 2012
As discussed in the proposed rule, in the Stage 1 final rule, we finalized many uniform definitions for the Medicare FFS, Medicare Advantage (MA), and Medicaid EHR incentive programs. These definitions are set forth in part 495 subpart A of the regulations, and we proposed to maintain most of these definitions, including, for example, “Certified EHR Technology (CEHRT),” “Qualified EHR,” “Payment Year,” and “First, Second, Third, Fourth, Fifth, and Sixth Payment Year.” We noted in the Stage 2 proposed rule that our definitions of “CEHRT” and “Qualified EHR” incorporate the definitions adopted by ONC, and to the extent that ONC's definitions are revised, our definitions would also incorporate those changes. For these definitions, we refer readers to ONC's standards and certification criteria final rule that is published elsewhere in this issue of the
We did not receive any comments on our proposal and will continue to use the existing definitions in part 495 subpart A, except where stated otherwise in this final rule.
We stated that we would revise the descriptions of the EHR reporting period to clarify that providers who are demonstrating meaningful use for the first time would have an EHR reporting period of 90 days regardless of payment year. We proposed to add definitions for the applicable EHR reporting period that would be used in determining the payment adjustments, as well as a definition of a payment adjustment year.
A summary of the comments pertaining to the EHR reporting period, the applicable EHR reporting period for determining the payment adjustments, and the definition of a payment adjustment year, as well as our responses to those comments, can be found in sections II.A.3.a and II.D.2 of this final rule.
We proposed to include clinical quality measure reporting as part of the definition of “meaningful EHR user” under § 495.4 instead of as a separate meaningful use objective under § 495.6.
We proposed to revise the third paragraph of the definition of meaningful EHR user at § 495.4 to refer specifically to the payment adjustments and read as follows: “(3) To be considered a meaningful EHR user, at least 50 percent of an EP's patient encounters during an EHR reporting period for a payment year (or during an applicable EHR reporting period for a payment adjustment year) must occur at a practice/location or practices/locations equipped with CEHRT.” We did not receive any comments on this revision and we are finalizing it as proposed.
In sections 1848(o)(2)(A) and 1886(n)(3)(A) of the Act, the Congress identified the broad goal of expanding the use of EHRs through the concept of meaningful use. Section 1903(t)(6)(C) of the Act also requires that Medicaid providers adopt, implement, upgrade or meaningfully use CEHRT if they are to receive incentives under Title XIX. CEHRT used in a meaningful way is one piece of the broader HIT infrastructure needed to reform the health care system and improve health care quality, efficiency, and patient safety. This vision of reforming the health care system and improving health care quality, efficiency, and patient safety should inform the definition of meaningful use.
As we explained in our Stage 1 meaningful use rule and again in our Stage 2 proposed rule, we seek to balance the sometimes competing considerations of health system advancement (for example, improving health care quality, encouraging widespread EHR adoption, promoting innovation) and minimizing burdens on health care providers given the short timeframe available under the HITECH Act.
Based on public and stakeholder input received during our Stage 1 rule, we laid out a phased approach to meaningful use. Such a phased approach encompasses reasonable criteria for meaningful use based on currently available technology capabilities and provider practice experience, and builds up to a more robust definition of meaningful use as technology and capabilities evolve. The HITECH Act acknowledges the need for this balance by granting the Secretary the discretion to require more stringent measures of meaningful use over time. Ultimately, consistent with other provisions of law, meaningful use of CEHRT should result in health care that is patient centered, evidence-based, prevention-oriented, efficient, and equitable.
Under this phased approach to meaningful use, we update the criteria of meaningful use through staggered rulemaking. We published the Stage 1 final rule (75 FR 44314) on July 28, 2010, and this rule finalizes the criteria and other requirements for Stage 2. We currently are planning at least one additional update, and anticipate finalizing the Stage 3 criteria through additional rulemaking in early 2014 with Stage 3 starting in 2016. The stages represent an initial graduated approach to arriving at the ultimate goal.
• The Stage 1 meaningful use criteria, consistent with other provisions of Medicare and Medicaid law, focused on electronically capturing health information in a structured format; using that information to track key clinical conditions and communicating that information for care coordination purposes (whether that information is structured or unstructured, but in structured format whenever feasible); implementing clinical decision support tools to facilitate disease and medication management; using EHRs to engage patients and families and reporting clinical quality measures and public health information. Stage 1 focused heavily on establishing the functionalities in CEHRT that will allow for continuous quality improvement and ease of information exchange. By having these functionalities in CEHRT at the onset of the program and requiring that the EP, eligible hospital or CAH become familiar with them through the varying levels of engagement required by Stage 1, we believe we created a strong foundation to build on in later years. Though some functionalities were optional in Stage 1, all of the functionalities are considered crucial to maximize the value to the health care system provided by CEHRT. We encouraged all EPs, eligible hospitals and CAHs to be proactive in implementing all of the functionalities of Stage 1 in order to prepare for later stages of meaningful use, particularly functionalities that improve patient care, the efficiency of the health care system and public and population health. The specific criteria for Stage 1 of meaningful use are discussed in the Stage 1 final rule, published on July 28, 2010 (75 FR 44314 through 44588). We are finalizing certain changes to the Stage 1 criteria in section II.A.3.b. of this final rule.
• Stage 2: We stated in the Stage 2 proposed rule that our Stage 2 goals, consistent with other provisions of Medicare and Medicaid law, would expand upon the Stage 1 criteria with a focus on ensuring that the meaningful use of EHRs supports the aims and priorities of the National Quality Strategy. Specifically, Stage 2 meaningful use criteria would encourage the use of health IT for continuous quality improvement at the point of care and the exchange of information in the most structured format possible. Our proposed Stage 2 meaningful use requirements included rigorous expectations for health information exchange including: more demanding requirements for e-prescribing; incorporating structured laboratory results; and the expectation that providers will electronically transmit patient care summaries with each other and with the patient to support transitions in care. Increasingly robust expectations for health information exchange in Stage 2 and Stage 3 would support the goal that information follows the patient. In addition, as we forecasted in the Stage 1 final rule, we proposed that nearly every objective that was optional for Stage 1 would be part of the core for Stage 2.
• Stage 3: We anticipate that Stage 3 meaningful use criteria will focus on: promoting improvements in quality, safety and efficiency leading to improved health outcomes; focusing on decision support for national high priority conditions; patient access to self-management tools; access to comprehensive patient data through robust, secure, patient-centered health information exchange; and improving population health. For Stage 3, we currently intend to propose higher standards for meeting meaningful use. For example, we intend to propose that every objective in the menu set for Stage 2 be included in Stage 3 as part of the core set. While the use of a menu set allows providers flexibility in setting priorities for EHR implementation and takes into account their unique circumstances, we maintain that all of the objectives are crucial to building a strong foundation for health IT and to meeting the objectives of the HITECH Act. In addition, as the capabilities of HIT infrastructure increase, we may raise the thresholds for these objectives in both Stage 2 and Stage 3.
In the Stage 1 final rule (75 FR 44323), we published the following Table 2 with our expected timeline for the stages of meaningful use.
We proposed changes to this timeline as well as its extension beyond 2014. As we explained in the Stage 2 proposed rule, under the timeline used in Table 2, an EP, eligible hospital, or CAH that became a meaningful EHR user for the first time in 2011 would need to begin their EHR reporting period for Stage 2 on January 1, 2013 (EP) or October 1, 2012 (eligible hospital or CAH). The HITPC recommended we delay by 1 year the start of Stage 2 for providers who became meaningful EHR users in 2011. We stated in the proposed rule that Stage 2 of meaningful use would require changes to both technology and workflow that cannot reasonably be expected to be completed in the time
We explained in the proposed rule that the Medicare EHR incentive program and the Medicaid EHR incentive program have different rules regarding the number of payment years available, the last year for which incentives may be received, and the last payment year for initiating the program. The last year for which an EP and an eligible hospital or CAH can begin receiving Medicare incentive payments is 2014 and 2015 respectively. These providers would begin in Stage 1 of meaningful use. Medicaid EPs and eligible hospitals can receive a Medicaid EHR incentive payment for “adopting, implementing, and upgrading” (AIU) to CEHRT for their first payment year, which is not reflected in Table 3. For example, a Medicaid EP who earns an incentive payment for AIU in 2013 would have to meet Stage 1 of meaningful use in his or her next 2 payment years (2014 and 2015). The applicable payment years and the incentive payments available for each program are discussed in the Stage 1 final rule.
If we anticipate future criteria beyond Stage 3 of meaningful use, we expect to update Table 3 in the rulemaking for Stage 3, which remains on schedule for implementation in 2016.
While commenters generally suggested a shorter EHR reporting period for the start of Stage 2 in any year rather than just Stage 2 in 2014, we believe that most of the reasons for a shorter period are due to the time constraints for vendor certification, upgrades and provider implementation between publication of this final rule and the beginning of Stage 2 in 2014. Any provider starting Stage 2 after 2014 will have more time and therefore most of the constraints are lifted. We acknowledge that not all constraints go away, but we believe that the balance is sufficiently shifted such that the concerns of data validity and program alignment outweigh the few remaining concerns with a full year EHR reporting period for the provider's first year of Stage 2 if it is after 2014. In addition, since ONC's 2014 Edition certification is for all EHR systems, regardless of the stage of meaningful use the provider using that system is in, there are far fewer implementation concerns after 2014. For example, if a provider begins Stage 2 in 2015, that provider would have been required to use CEHRT (that was certified to the 2014 Edition EHR certification criteria) for the previous year (2014) for Stage 1.
Finally, we considered that for the Medicaid EHR incentive program, EPs work exclusively with the states as they must choose between either the Medicare or Medicaid EHR incentive program. We do not know whether shifting from an EHR reporting period of any continuous 90 days to a 3-month quarter will provide any alignment benefits for Medicaid EPs, and it could introduce system complexity for Medicaid agencies. Therefore, we are maintaining flexibility for states to allow Medicaid EPs to select any continuous 90-day EHR reporting period during 2014 as defined by the state Medicaid program, or, if the state so chooses, any 3-month calendar quarter in 2014. As nearly all hospitals participate in both Medicare and Medicaid, we are using the 3-month quarter EHR reporting period for all hospitals to align both programs.
After consideration of the public comments received, we are modifying our proposal with regard to the EHR reporting periods for EPs, eligible hospitals and CAHs that attest to meaningful use for 2014 for their first year of Stage 2 or their second year of Stage 1. Our final policy is as follows: For 2014, Medicare EPs will attest using an EHR reporting period of January 1, 2014 through March 31, 2014; April 1, 2014 through June 30, 2014; July 1, 2014 through September 30, 2014; or October 1, 2014 through December 31, 2014. For 2014, Medicare and Medicaid eligible hospitals and CAHs will attest using an EHR reporting period of October 1, 2013 through December 31, 2013; January 1, 2014 through March 31, 2014; April 1, 2014 through June 30, 2014; or July 1, 2014 through September 30, 2014. Medicaid EPs will attest using an EHR reporting period of any continuous 90-day period between January 1, 2014 and December 1, 2014 as defined by the state Medicaid program, or, if the state so chooses, any 3-month calendar quarter in 2014.
We proposed the following changes to the objectives and associated measures for Stage 1:
• Computerized Provider Order Entry (CPOE)—In 2013 (CY for EPs, FY for eligible hospitals/CAHs), we proposed that providers in Stage 1 could use the alternative denominator of the number of medication orders created by the EP or in the eligible hospital's or CAH's inpatient or emergency department (POS 21 or 23) during the EHR reporting period (for further explanation of this alternative denominator, see the discussion of the CPOE objective in the Stage 2 criteria section at II.A.3.d. of this final rule).
A provider seeking to meet Stage 1 in 2013 can use either the denominator defined in the Stage 1 final rule or the alternative denominator to calculate the percentage for the CPOE measure. We also proposed to require the alternative denominator for Stage 1 beginning in 2014.
• Vital Signs—For the objective of record and chart changes in vital signs, the proposed Stage 2 measure would allow an EP to split the exclusion and exclude blood pressure only or height/weight only (for more detail, see the discussion of this objective in the Stage 2 criteria section at II.A.3.d. of the final rule). We proposed an identical change to the Stage 1 exclusion as well, starting in CY 2013. We als