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HHS Scales Back Electronic Health Record Rule in Final Version Released

By Rebecca Adams

July 13, 2010 -- The Department of Health and Human Services (HHS) released a final rule Tuesday setting standards for the electronic health records of hospitals and doctors that eased some of the requirements medical providers had complained about in an earlier proposal.

"We reduced the number of requirements and introduced flexibility into the attainment of those objectives," said David Blumenthal, the national coordinator for health information technology at HHS, calling the final standards "realistic but still ambitious."

Obama administration officials have made a priority of pushing providers to adopt electronic records that they say will reduce errors, streamline operations, reduce unnecessary tests and lower medical costs. The regulation governing the "meaningful use" of electronic records is part of a larger health information technology program included in the 2009 economic stimulus law that will provide up to $27 billion in incentives over a decade. The administration has touted the digitalization of health information as a critical development that will support its overhaul of the nation's health care system.

Blumenthal acknowledged, however, that moving medicine into the Internet age is not as fast as turning on a light bulb. "We understand it will be some time before a robust exchange exists" so physicians in different states can easily share a patient's records in a way that also protects the person's information from being seen by unauthorized individuals.

The regulation, the first of a three-stage plan aimed at motivating physicians and other providers to implement electronic systems that meet HHS standards, is part of an effort aimed at overcoming the reluctance of some physicians and hospitals to invest in the technology. In 2011 and 2012, providers who meet a set of goals such as electronically recording patients' demographic information, allergies and vital signs could receive bonus Medicare or Medicaid payments of more than $2 million for individual hospitals and at least $44,000 for physician practices.

By the third stage in 2015, the carrot will be replaced with a stick. Providers will be penalized with lower Medicare payments if they have not complied.

The final version released Tuesday differs from January's original proposal in several ways. HHS officials received more than 2,000 comments from interested parties, many of whom wanted to see changes. The requirements of the original proposal were seen as too stringent even by health systems that are internationally renowned for their health IT efforts, such as the Mayo Clinic, which began investing in health IT in 1992.

Originally, the proposal would have required providers to meet all criteria on a list, with hospitals having to meet 23 objectives and clinicians facing 25 requirements. Providers complained that the all-or-nothing approach was virtually impossible to meet, noting that if a hospital completely met 22 requirements and most of the last one, they still would get no additional funding.

The final rule takes a different approach by setting core mandates that must be met, then giving providers some flexibility to choose from other goals on a list. Hospitals would have to meet 19 goals in total and providers such as physicians would have to meet 20, but the providers would be able to choose five of the goals from a menu of 10 options. The rest of the goals would be non-negotiable.

Some examples of the core mandates that must be met in order to receive funding include requirements for providers to record more than half of patients' demographic data and vital signs; maintain diagnostic, drug and medication allergy information for more than 80 percent of patients; record smoking status for more than half of patients; order medication electronically for more than 30 percent of patients; test the ability to exchange information with other providers; provide more than half of patients who request their records with copies of within three days; and conduct IT security checks.

Other optional goals that providers could get credit for include incorporating more than 40 percent of certain lab results into electronic records; providing summaries of care for more than half of patients who are going to another provider or setting; and providing immunization or disease surveillance data electronically to government agencies. Regulators also heeded concerns from consumer groups who wanted advanced directives to be part of patients' electronic records, and will allow hospitals to count the inclusion of advanced directives for more than half of seniors as a voluntary objective that would help them meet the goals of the regulation.

The final rule also lowered the percentage of patients required to qualify for many of the goals criteria and scaled back reporting requirements. For instance, the original rule had required physicians to electronically transmit 75 percent of the prescriptions that they prescribe, while the final version requires only 40 percent.

Another regulation clarifies some of the technical aspects of building a health IT system and what elements should be included.

Hospitals and physicians voiced general support for the changes in the rule, although some had specific remaining concerns.

American Hospital Association director of health information technology Chantal Worzala said meeting 19 criteria still constitutes "a high bar."

She voiced concern that one of the core mandates would require that providers order at least one medication electronically for more than 30 percent of patients. That was scaled back from the original version, which had included not just medications but also other services such as lab tests, but AHA officials worry that many hospitals will still have a hard time meeting the revised requirement.

They also worry that the timeline does not provide much lead time for hospitals and other providers to get their systems certified.

Regulators also declined to change a requirement that hospitals on the same campus be treated as one system, instead of as separate systems. Hospital lobbyists complained that each hospital within a system should be eligible for bonus payments separately and should not be penalized if a different part does not meet the requirements.

Officials at the Centers for Medicare and Medicaid Services said they felt that they needed to treat hospitals on a campus as one provider in order to remain consistent with other policies.

Federation of American Hospitals president and CEO Chip Kahn protested and called on Congress to change that part of the law.

"Patients of a hospital should be confident that their hospital is receiving the full [statutory] incentive, regardless of whether that hospital has an individual provider number or shares a provider number with other hospitals," Kahn said. "So, it is essential that Congress clarifies the definition of an eligible hospital to put all hospitals on a level playing field for the distribution of incentive payments."

Overall, however, Kahn supported the rule, saying the final version "recognizes many of the practical concerns" that the for-profit hospitals in his association had expressed about the original proposal.

The American Medical Association voiced some skepticism about whether a large number of physicians would be able to benefit in the first stage of the program.

"Physicians recognize the potential for health IT and want to adopt new technologies, but costly [electronic health record] systems are out of reach for many physicians," said Steven J. Stack, an AMA board member, in a statement released by the organization.

At a public briefing held to explain the regulations, Secretary Kathleen Sebelius shared a personal anecdote intended to explain why the move to electronic health records is so important. Sebelius spent Monday night with a friend in the emergency room who had internal bleeding. The woman had been in a hospital in another city over the July 4 holiday, but was sent home. When the symptoms started again and the woman went to a Washington-area hospital, the HHS secretary watched as different providers scribbled down her friend's medical history and medication list four separate times. Speculating that the doctors may have stuffed the information in their pockets instead of sharing it with other providers, Sebelius shook her head at the inefficiency of it all, and how "ripe it is for possible mistakes."

She called it a "good reminder of why we're here today."

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