Maggie Mahar asks this provocative question in a recent Health Beat posting. She posits that the $27 billion in incentives for physicians and hospitals in the American Recovery and Reinvestment Act (ARRA a.k.a. the stimulus bill) is creating a worrisome “bubble” in the market for EHRs. She writes:
“I am hardly an IT expert. But I have spent enough years observing markets—stock markets, real estate markets, and most recently, our health care market—to recognize a big, bright Bubble when I see one. Eager to take advantage of fat federal subsidies, too many buyers, with too little information, are scrambling to purchase health IT. And, as is always the case, too many sellers are all too eager to satisfy the buyer’s desire to part with his money. But many vendors won’t have the resources to follow through on the services and training that they promise. Or, they will be too busy chasing the next customer to meet their commitments. More importantly, the majority of HIT vendors cannot fathom what it’s like to work in an ER or a busy primary care office, and so they cannot begin to grasp precisely what doctors and nurses need.”
The federal subsidies that she is referring to are incentive payments – up to $44,000 under Medicare or $63,750 under Medicaid – that physicians can receive over the next five years for adopting EHRs and meeting the federal government’s “meaningful use” rules. After five years, physicians who do not meet the requirements will be subject to Medicare pay cuts.
The question of whether the government should cut-off the incentive payments is not merely an academic one. House Republicans have introduced legislation to eliminate all “unused” stimulus dollars, which presumably would include the EHR incentive program since those funds have only started to be paid out to physicians and hospitals. (The Senate would have to go along, though, and President Obama likely would veto any cut-off.)
Mahar ends up deciding that the government should not eliminate the incentive payments because “it would be too hard to get that money back, and ultimately health care providers will need subsidies in order to purchase this much-needed technology. . .That said, I definitely would like to see the process of adopting HIT slow and perhaps the House [GOP] bill will generate a conversation about the mad rush to fund EHRs.”
I understand Ms. Mahar’s concern about the rush by EHR vendors to corner market share while the stimulus funds are available, and the pressure that this places on physicians to make a decision on acquiring or upgrading EHRs to qualify for the incentives. But, as she recognizes, pulling the plug out entirely on the incentive funding would be a big step backwards. “What is the alternative?” said one of ACP’s own staff experts on health information technology when I asked his reaction to the calls to eliminate the incentive program. He added “Our current paper system is more broken and more dangerous than the emerging health IT systems on their worst days.”
Good point. And it’s not like the goal of universal adoption of EHRs is a new one. Giving everyone access to electronic health records within 10 years was first set by a Republican president, George W. Bush, six years ago in his State of the Union address to Congress.
It is widely recognized that the costs to clinicians is a principal barrier, one that the ARRA incentive program is designed to help overcome. The possibility that the incentive program could be eliminated will have a chilling effect on physicians who are contemplating buying or upgrading their EHRs. I addressed this in my remarks at ACP’s briefing last week on the state of the nation’s health care, noting that, “The threat that Congress might cancel the incentive program will discourage physicians from moving forward on health information technology investments, and could pull the rug out on those who have already invested tens of thousands of dollars in the expectation that they will qualify for the incentive payments.”
In my mind, the government offered physicians a quid pro quo, invest in EHRs for meaningful use and we’ll help offset your costs. Reneging on that promise now would be harmful and unfair to physicians who are meeting their end of the bargain, and harmful to patients by setting back for many more years the goal set by President Bush that we’d all have access to electronic health records by 2015.
Today’s questions: What do you think about the possibility that Congress could cut off the ARRA incentives to doctors for electronic health records? What impact would this have on your decisions?