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  • Medicare Incentive Payments: Schedules of Payment Incentives & Penalties

    Explains the schedule of Medicare incentive payments and penalties under Electronic Health Records (EHR) Incentive Payment Program, the E-Prescribing Incentive Payment Program, and the Physicians Quality Reporting System.

    EHR Incentive Payment Program

    Medicare began disbursing a fixed dollar amount incentive payment to “meaningful users” of health information technology in 2011—these incentive payments will continue (but at declining amounts) through 2016. Like the PQRS and eRx Incentive Program, non-adopters will eventually be hit with ongoing payment penalties. See the table below for the schedule of EHR incentive payments and penalties under the Medicare Program—a different incentive payment schedule and applies to Medicaid.

     


     

    First Calendar Year (CY) in which the EP
    Receives an Incentive Payment
     

    CY 

    2011 

    2012 

    2013 

    2014 

    2015+ 

    2011 

    $18,000 (1) 

    ------

    ------

    ------

    ------

    2012 

    $12,000 (1) 

    $18,000 (1) 

    ------

    ------

    ------

    2013 

    $8,000 (2) 

    $12,000 (1) 

    $15,000 (1) 

    ------

    ------

    2014 

    $4,000 (2) 

    $8,000 (2) 

    $12,000 (2) 

    $12,000 (1) 

    ------

    2015 

    $2,000 (3) 

    $4,000 (2) 

    $8,000 (3) 

    $8,000 (3) 

    $0; -1% pay cut (3) 

    2016 

    ------ (3) 

    $2,000 (3) 

    $4,000 (3) 

    $4,000 (3) 

    $0; -2% pay cut (3) 

    TOTAL 

    $44,000 

    $44,000 

    $39,000 

    $24,000 

    $0 

    (1) Must successfully demonstrate Phase 1 meaningful use criteria
    (2) Must successfully demonstrate Phase 2 meaningful use criteria
    (3) Must successfully demonstrate Phase 3 meaningful use criteria

    PQRS and eRx Incentive Program

    Medicare’s PQRS and eRx Incentive Program have been established for several years, and incentive payments already are beginning to decline. See the table below for the schedule of incentive payments and penalties for these two programs.

     


     

    PQRS 

    eRx 

    Year 

    Successful 

    Not Successful 

    Successful 

    Not Successful 

    2009

    +2.0%

    --

    +2.0%

    --

    2010

    +2.0%

    --

    +2.0%

    --

    2011

    +1.0%*

    --

    +1.0%

    --

    2012

    +0.5%*

    --

    +1.0%

    -1.0%** 

    2013

    +0.5%*

    --

    +0.5%

    -1.5%

    2014

    +0.5%*

    --

    --

    -2.0%

    2015

    --

    -1.5%

    --

    -2.0%

    2016 (& subsequent years)

    --

    -2.0%

    --

    -2.0%

    * Does not include the possibility of earning an additional +0.5% PQRS incentive payment for participating in a maintenance of certification program and successfully completing a qualified maintenance of certification program practice assessment.


     

    **IMPORTANT: eRx penalties for 2012 will be assessed against eligible professionals (EPs) who do not submit at least 10 electronic prescriptions on their Medicare claims during the first 6 months of 2011 (January 1 – June 30). This rule applies regardless of which eRx reporting option--claims, EHR, or registry--is chosen and regardless of whether you choose to pursue the fixed dollar "meaningful use" incentive payments instead of the eRx incentive payment. 

    Download Free E-prescribing Software: This may be a good option for practices that do not wish to invest a lot of money in a standalone eRx system but need 1) a short term solution that avoids the 2012 eRx payment penalty, and 2) time to implement an EHR system that includes an eRx component.

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