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What would happen if the EMR incentive program was halted? The EMR & HIPAA blog has a good discussion of the consequences of a proposal by some U.S. Congressmen to halt the incentive payments begun under Meaningful Use. I believe the incentive program is not only promoting electronic health records in this country but also paving the way for wider adoption of evidence-based clinical decision support, which can point the healthcare system toward more effective treatment decisions and away from less effective treatments that waste money and sometimes endanger patient health.

As the new Congressional Debt Reduction Super Committee prepares to meet next month to cut government spending by $1.2 trillion over the next decade, supporters of the Health Information Technology for Economic and Clinical Health Act (HITECH) are marshaling various arguments for preserving the electronic health records (EHR) incentive program. EHRs save money and improve outcomes. HITECH has bi-partisan support. Doctors and hospitals are purchasing EHR systems, diverting staff time and changing workflows under the belief that HITECH incentive dollars will eventually reimburse them for their initial investments of time and money.

These are all sound arguments that should be highlighted, but perhaps the most compelling case to be made to members of the Super Committee is that HITECH is helping create jobs.

Barring a war or other cataclysmic event, the results of the 2012 election will be closely tied to unemployment. Recent polls show that the public considers jobs to be the number one issue on which the President and Congress should be focused. Neither Democrats nor Republicans receive high marks on the issue from likely voters so both sides will be especially attentive to job creation this fall.

Washington’s renewed focus on jobs provides yet another opportunity for the HITECH program to show its worth. Talk to anyone in the health information technology (HIT) industry and they will share an anecdote about their company’s aggressive hiring or the dearth of qualified candidates to fill openings. Significant HIT job growth is surely happening, but unfortunately, there does not appear to be any hard data to support these anecdotes.

The most often cited figure is contained in a section of the 2010-2011 Occupational Outlook Handbook issued by the Bureau of Labor Statistics (BLS). In their Outlook, BLS sees job prospects for Medical Record and Health Information Technicians growing faster than average (20%) and estimates that 35,000 new jobs will be added by 2018. Last week, Computer Economics, an IT research and advisory firm, revealed that 61 percent of health care organizations plan to increase IT staff in 2011. In testimony before a House Small Business Subcommittee in early June, the National Coordinator for Health Information Technology, Farzad Mostashari, pointed to the fact that 60% of the HIT products certified as of early June had been developed at firms with 50 employees or fewer, suggesting that HITECH dollars were spurring job creation among small businesses.

Dr. Mostashari’s testimony illustrates this lack of hard data on job creation. Besides citing the BLS outlook, he said the following in his written testimony:

“Other sources suggest that many jobs are being created among private sector firms that install and maintain EHR systems for providers. The software and tech industries are also adding jobs as more EHR products are developed and hardware is manufactured. Our experience suggests that many jobs are being created among private sector firms that install and maintain EHR systems for providers.”

The Office of the National Coordinator should seek out these ‘other sources’ to provide more detail and data on job creation. Similarly, the American Medical Association and American Hospital Association may have figures to share on HIT job growth in large practice groups and hospitals. HIMSS should consider surveying its membership to gauge the pace of job growth in the industry between 2009 and the present. At a minimum, the upcoming HIMSS Policy Summit in mid-September provides an excellent opportunity to collect additional anecdotes and testimonials about job growth in the HIT sector.

With the public seeking answers on both the debt and jobs, members of the Super Committee will be hard pressed to cut any program that can demonstrate cost savings in the long run and job creation in the near term. There are already numerous studies to demonstrate the enormous cost savings EHR adoption will generate over the long term. If the HIT industry can also present solid data illustrating HITECH’s job-creating power, supporters of the EHR incentive program should be able to sleep soundly this fall.

Up until the passage of the HITECH Act in 2009, electronic health records (EHR) were largely unregulated, with adoption rates among providers not significant enough to warrant government oversight. CMS’ final rule defining the Stage 1 ‘Meaningful Use’ criteria was the first widespread federal effort to control the implementation and use of EHRs. Given the financial commitment the federal government is making to wire the U.S. health care system, and the critical role EHRs will play in streamlining care and assisting in clinical decision-making, future regulatory oversight of health information technology (HIT) promises to be both rigorous and widespread.

While exact roles still need to be defined, there will be at least three federal agencies exercising some level of regulatory jurisdiction over EHRs.

Through the EHR Incentive program and the Meaningful Use criteria, the Center for Medicare and Medicaid Services (CMS) will play a hands-on role in the use of EHR systems through this decade. Though the final stage of the EHR Incentive program will occur in 2015, Medicaid providers have a much longer glide path to adoption and could conceivably receive incentive payments up until 2021. Even after incentive dollars cease to flow, CMS can still control behavior by levying penalties on providers and hospitals (in the form of lower reimbursements) who have not become meaningful users.

CMS is also beginning to build a foundation for oversight by including EHR-related requirements and mandates in other programs. For example, the recently released Notice of Proposed Rulemaking (NPRM) on the Medicare Shared Savings Program requires that at least 50% of an Accountable Care Organization’s (ACO) providers be meaningful users of HIT. The NPRM also requires an ACO’s infrastructure to include shared clinical decision support capabilities, and to report the percentage of their providers who use CDS.

The prospect of regulatory oversight by the Food and Drug Administration (FDA) has caused many a sleepless night for HIT vendors, who fear their product development efforts will suffer from the same filings, trials and delays the pharmaceutical and medical device industries have experienced. The FDA has already stated publicly that health information technology falls within its jurisdiction. The only question remaining is whether select HIT products will be labeled as Class III devices, subject to pre-market approval before being rolled out to doctors and hospitals. The HIT Industry received positive news (relatively speaking) in February when the FDA released a rule on Medical Device Data Systems, determining that these would be treated as Class I devices only, requiring registration, quality manufacturing practices and reporting of adverse events, but stopping short of pre-market approval. The FDA has recently indicated that it will regulate mobile medical applications that will run on smart phones, tablets and other hand-held devices, with specific guidance to be released later this year. Further definition of the FDA’s role may also be forthcoming this fall when the Institute of Medicine releases a report on HIT and patient safety.

A relative newcomer to the federal regulation scene, the Office of the National Coordinator for Health Information Technology (ONC) is already overseeing the EHR certification and standards setting processes that support the EHR Incentive program. As health information technology becomes more ingrained in other programs (i.e. ACOs, Medical Homes) as well as the default method for CMS quality reporting, look for ONC to continue providing certification for HIT functionality so doctors and hospitals can rest assured the new systems and modules they purchase meet government guidelines. Similarly the emphasis on health information exchange to foster care coordination will require ONC to continually update and articulate new data exchange standards. ONC’s future regulatory role will be further defined (and likely expanded) in the upcoming NPRM on Governance of the National Health Information Network.

Other federal agencies and offices will also play roles in overseeing or influencing HIT policy, including the National Institute for Standards and Technology (NIST) and HHS’ Office of Civil Rights (OCR). NIST will continue to work with ONC on testing procedures and scripts used in the certification process. OCR will focus on safeguarding personal health information that is more widely accessible through the use of HIT. OCR’s recent NPRM updating the Health Insurance Portability and Accountability Act (HIPAA) with new accounting of disclosures rules is just one example of their work in HIT.

And this is just the feds. In a future post, I’ll explore the possible role states will play in regulating health information technology.

The digitization of the American health care system began earlier this year with the launch of the Health Information Technology and Economic Health (HITECH) incentive program. Eligible providers and hospitals who install certified electronic health record (EHR) systems and use them in a meaningful way will receive incentive payments from the federal government to help defray the cost of the installation. The program could cost as much as $30 billion over the next decade, fulfilling President Obama’s goal of having an electronic health record for every American by 2014.

As is typically the case with government programs of this scope and magnitude, HITECH is being implemented in stages.  Stage 1 was launched this past January. Stage 2 is set to follow in 2013 and Stage 3 two years later.  The HIT Policy Committee, a public private advisory council created by HITECH and tasked with the defining “meaningful use”, already has draft criteria for Stage 2 which were subjected to public comment in February. Though stakeholders generally supported the proposed criteria, many eligible providers, hospitals and HIT vendors complained that the January 2013 launch date for Stage 2 was much too aggressive.

Several options for delaying Stage 2 are currently being considered by the HIT Policy Committee’s Meaningful Use work group. The first would involve carrying over the 90-day reporting period from Stage 1 into Stage 2. Since doctors and hospitals would only have to be compliant on Stage 2 criteria for 90 days during 2013, they could effectively delay implementation 9 months until October 1^st. The second option would simply push the start date for Stage 2 to January 2014.  A third alternative is to split Stage 2 criteria into two groups: those that draw upon Stage 1 HIT functionality would launch on schedule; those that require new HIT functionality would be delayed until 2014.

Don’t expect the Centers for Medicare and Medicaid Services (CMS) to immediately embrace delay. An overly aggressive deadline is a common complaint heard by regulatory agencies. The critique on Stage 2 timing was loud but not universal, with consumer advocates strongly in favor of maintaining the current timelines. Even some doctors and hospitals support the 2013 launch. This past Friday in a hearing held by the Meaningful Use work group, representatives of a small physicians group in Wisconsin and a federally qualified health center in Washington DC both voiced support for the current HITECH timeline.

While maximizing HITECH payments represents a strong incentive for doctors and hospitals to implement Stage 2 on time, there is no penalty for failing to do so. Penalties in the form of reduced payments from Medicare do not begin until 2015. In lieu of delay, CMS may decide to scale back new Stage 2 criteria, particularly those that require new HIT functionality. And from a purely political standpoint, delaying a program is usually a signal that that program is not working. Neither President Obama nor HHS Secretary Sebelius want to send that message about HITECH, particularly during an election year.

Look for CMS to adhere to the current January 2013 launch for Stage 2 in the Notice of Proposed Rulemaking tentatively scheduled for release later this year. CMS loses nothing in proposing the current timeline in the NPRM and gauging stakeholder support or opposition for delay. By that time, more data will also be available on Stage 1 participation. Short of universal hue and cry in support of delay, and data showing unusually low participation in HITECH, the January 2013 launch of Stage 2 will most likely remain in place.