Bill Seeks 'Parity' In Meaningful Use Incentives

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Showing the power of the healthcare industry on Capitol Hill, a new bill that would require the government to treat multi-hospital systems the same for purposes of Meaningful Use, whether or not they had a single Medicare number, has gained 50 cosponsors in the House. But it's unclear that the proposed legislation, which is similar to House and Senate bills that failed to pass last year, will be adopted this time around.

Rep. Michael C. Burgess, MD, (R-Tex.), Rep. Eliot Engel (D-N.Y.), Rep. Kevin Brady (R-Tex.) and Rep. Charlie Rangel (D-N.Y.) introduced the Equal Access and Parity for Multi-Campus Hospitals (HITECH) Act, HR 2500, on July 12. The measure aims to change how the Centers for Medicare and Medicaid Services (CMS) defines multi-facility healthcare organizations for purposes of determining the incentives paid to those that show Meaningful Use of electronic health records (EHRs).

Under the final regulations that CMS adopted to implement the Health Information Technology for Economic and Clinical Health (HITECH) Act, multi-hospital systems can qualify for health IT incentives either as single entities or as multiple hospitals. In either case, each entity that wishes to receive incentive payments must apply under its own Medicare certification number -- which is used for filing cost reports to CMS, among other things. Some hospitals have chosen to use multiple numbers, which maximizes their Meaningful Use rewards; others have stuck with one Medicare number for their entire organization.

The bill's cosponsors, as well as the American Hospital Association (AHA), view it as unfair that healthcare systems with a single Medicare number should not be able to obtain separate incentives for each of their hospitals if those that have multiple numbers can do so.

"The current rule provides only one payment for multi-campus hospitals, treating them as if they were only one hospital," said Burgess, who serves as the vice chair of the House Energy and Commerce Committee's subcommittee on health, in a press release. "In reality, though, if a hospital has multiple campuses, they will be spending money for HIT implementation at each location. Even after several attempts to get this provision fixed, the [CMS] rule still ignored the issue, and this bill would finally fix the problem."

Supporters of the bill also argue that by providing more money to multi-hospital systems, their "fix" would encourage additional healthcare organizations to adopt EHRs and show Meaningful Use. "This legislation is instrumental to delivering the promise of electronic health records to more Americans," said AHA president and CEO Rich Umbdenstock. "And with integrated electronic health records will come improved patient outcomes and efficiencies in care delivery to support better health and health care."

But if healthcare systems can apply for separate Medicare certification numbers for their hospitals to get payments for each facility, why is this legislation needed?

"That's an organizational decision," Chantal Worzala, director of policy for the AHA, told InformationWeek Healthcare. "Separating out and getting different numbers is a huge undertaking. You can imagine the number of lawyers that would have to be involved and the number of accounting structures that would have to be changed. Why would you do that just for this purpose? We think it should just be one payment per facility. A hospital system with five locations should have an equal opportunity to get five incentive payments, no matter how they're identifying themselves to CMS."

Rep. Burgess said in an interview that "there are unintended consequences if hospital systems file for multiple Medicare numbers." Healthcare systems in his district that now have a single provider number, such as Presbyterian Health System and HCA, "would have to alter their computer systems," which could lead to billing errors, he said.

A CMS spokesman said that the agency is merely upholding current law and noted that a Medicare official, Tony Trenkle, testified on this matter last year when similar bills were being debated in the House.

In the final rule on Meaningful Use, published July 28, 2010, CMS explained its rationale for not allowing multi-hospital systems to receive incentive payments for each facility under a single Medicare number. The agency said that any entity that represented itself as a single hospital would have to continue filing cost reports under a single number in order to comply with other CMS regulations.

Burgess didn't buy that argument. "Why does CMS put the burden on the hospital? CMS shouldn't be there to make life more difficult for the hospital," he stated.

Regarding the fairness argument, CMS pointed out that if it provided incentives to each facility in a multi-hospital system organized as a single entity, that system would stand to gain more in total than did hospital systems in which each facility held a separate Medicare number.

Asked how much extra the government might have to pay out in incentives if the bill were passed, Worzala said, "The cost is dependent on the share of hospitals that can get across the [Meaningful Use] threshold. And what we're seeing from the numbers coming out of CMS is that it's off to an incredibly slow start."

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