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OIG Report OEI-05-11-00250 — Problems With Medicare’s EHR Incentive Payment Program


(January 7, 2013): Have you read Office of Inspector Generals’s (OIG’s) report, OEI-05-11-00250? The DOIGepartment of Health and Human Services, Offices of Inspector General (OIG) has identified a number of obstacles in the way the Centers for Medicare and Medicaid Services (CMS) has been overseeing Medicare’s Electronic Health Record (EHR) Incentive Program. These vulnerabilities in the program could lead to overpayment of incentives to medical providers that do not meet EHR meaningful use requirements.


I.  Background of the EHR Incentive Payment Program:

The Medicare EHR incentive payment program was created by the American Recovery and Reinvestment Act with the aim of promoting the use of EHR technology by healthcare providers. This technology is comprised of computerized record keeping systems and is meant to improve health care quality and efficiency. To meet the qualifications for Medicare’s EHR incentive payment program, healthcare professionals and hospitals must possess certified EHR technology and meaningfully use that technology in accordance with CMS criterion for a 90-day reporting period. For example, one meaningful use measure requires providers to submit over 40 percent of all prescriptions electronically. As of September 2012, CMS had paid approximately $4 billion in incentive payments to 82,535 health care professionals and 1,474 hospitals.

In order to receive incentive payment, providers self-report information on their meaningful use of EHR technology to CMS. This is the root of the issue — self-reporting information leaves potential for miscalculation or dishonest reporting that could lead to incorrect allocation of incentive payments. To avoid this, CMS conducts prepayment validation of self-reported meaningful use information and intends to audit selected providers after payment. If a provider fails either step, they will not receive incentive payments or CMS (more than likely one of its contractors) will initiate proceedings recover any incentive funds paid to a provider.  However, HHS-OIG found that these two steps are not sufficient for proper oversight of the Medicare EHR incentive program.

II.  Methodology Used by the OIG:

The OIG conducted an extensive review of the Medicare EHR incentive payment program oversight process. It reviewed self-reported meaningful use information for providers that were approved to receive incentive payments and determined whether that information met meaningful use measure criteria. It reviewed federal regulations and CMS’s audit planning documents in addition to conducting structured interviews with CMS staff about payment oversight.

III.  Findings Discussed in OEI-05-11-00250

The OIG found that in the past, CMS does not always verified the accuracy of a physician’s or other health care provider’s self-reported meaningful use information prior to receiving payment. Instead, it appears that providers have been found to be eligible for incentive payments based solely on information self-reported by the health care provider. Although their prepayment validation step functions properly, it does not verify that the self-reported information is accurate and CMS doesn’t have sufficient data sources available to verify the self-reported information.

Moreover, the OIG also found that CMS’s planned post-payment audits may not conclusively verify the accuracy of physicians’’ and hospitals’ self-reported meaningful use information. CMS may not be able to acquire adequate supporting documentation to verify self-reported information during audits. Additionally, reports from certified EHR technology are not sufficient for CMS to verify self-reported information, which is an issue with the Office of the National Coordinator for Health Information Technology (ONC) requirements for EHR reports.

IV.  Recommendations:

Based on these findings, the OIG has recommended that CMS take the following actions:

  • Obtain and review supporting documentation from selected health care providers and hospitals prior to payment to verify the accuracy of their self-reported information; and
  • Issue guidance that details the types of documentation it expects professionals and hospitals to maintain to support their compliance.

HHS-OIG recommended that ONC take the following actions:

  • Require certified EHR technology to be capable of producing reports for yes/no meaningful use measures, where possible; and
  • Improve the certification process for EHR technology to ensure accurate EHR reports.

CMS did not concur with its first recommendation and HHS-OIG continues to recommend that CMS conduct more extensive prepayment reviews of selected providers. CMS did concur with the second recommendation and is currently developing extended guidance that professionals and hospitals can utilize to ensure their compliance with meaningful use measures. ONC concurred with both recommendations and is currently working towards their completion. This assessment of CMS oversight of the Medicare EHR incentive program is invaluable to strengthening the program.

V.  Our Take on the EHR Incentive Payment Program:

CMS has diligently worked to incentivize health care providers of all sizes to convert to an electronic-based records system.  In recognition of the cost and complexity of this project, CMS has assisted converting health care providers with a portion of the costs incurred.  Should your physician practice or clinic choose to participate in this incentive program, it is essential that you fully understand the rules, requirements and obligations you are assuming in exchange for these EHR funds.  All incentive program participating providers should prepare to be audited.  If anything, the OIG’s findings, as set out in OEI-05-11-00250, will serve to galvanize CMS’ commitment to better ensure that EHR incentive program funds are properly spent.  In recent weeks, we have been contacted by various health care providers (including a single physician practice) in connection with EHR meaningful use audit letters they have received. Therefore, we strongly encourage all incentive program participants to review their obligations under the rules.  Are they complying with the program requirements?  If not, what remedial steps must be taken?  As our friend D.K. Everitt reminds us, Compliance is not an option.”  

Healthcare LawyerRobert W. Liles serves as Managing Partner at Liles Parker, PLLC, a boutique health law firm representing physicians, home health agencies, clinics and other health care providers around the country.  If your practice is audited, give us a call for a free consultation.  Robert can be reached at:  1 (800) 475-1906.

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