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Hospitals in Medicaid Sharply Boost Use of Health IT Under Stimulus, GAO Says

By John Reichard, CQ HealthBeat Editor

December 14, 2012 -- Hospitals in the Medicaid program have sharply increased their use of health information technology (IT) in response to about $12 billion in incentive payments available to them between 2011 and 2019 under the economic stimulus law, the Government Accountability Office (GAO) says.

In 2009, the year the law (PL 111-5) was passed, only 9 percent of hospitals had adopted electronic health records, the report says. The GAO found that in 2011, the first year of the payments, 1,964 hospitals, or 39 percent of the 5,013 hospitals eligible, got a total of $1.7 billion in Medicaid incentive payments to adopt EHRs.

Payments awarded to each hospital ranged between $7,528 and $7.2 million. The median payment amount was $613,512.

The GAO conducted the study to learn the impact of the payments on the adoption of health IT. It also wanted to identify characteristics of hospitals that hadn't applied for the payments. "Hospitals with the highest number of total beds were two times more likely to have been awarded an incentive payment than hospitals with the lower number of beds," the study said.

The largest proportion of the hospitals getting the payments, 46 percent, were in the South, and the smallest, 15 percent, were in the Northeast. Major teaching hospitals, for-profit hospitals and chain hospitals were 1.3 to 1.4 times more likely than other hospitals to be awarded payments.

All told, the stimulus included an estimated $30 billion in Medicare and Medicaid incentive payments between 2011 and 2019, the Congressional Budget Office estimated, with $12.4 billion of that being Medicaid money.

The study also examined Medicaid payments made in 2011 to individual doctors and other health care professionals. The 45,962 professionals awarded a payment made up 33 percent of the 139,600 eligible. Almost all got the maximum amount available in 2011: $21,250.

Four-fifths of the professionals practiced in urban areas; three-quarters were doctors. Almost half of the doctors receiving payments had signed agreements to get technical help from regional extension centers created under the stimulus to help providers adopt health IT.

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