The Federal Government’s commitment to advancing healthcare IT is seen in its “carrot and stick” approach. Now, for the first time, physicians who are not yet <a href="/directory/e-prescribing" target="_blank" class="directory-item-link">e-prescribing are feeling the “stick” end of the equation. Those doctors who did not report at least 10 paperless drug orders to CMS by the end of June will be penalized by a 1% reduction in Medicare payments.
A limited number of hardship exceptions exist:

a)    providers in rural areas with limited high-speed internet access
b)    those practicing where a dearth of pharmacies are capable of processing e-prescriptions
c)    eligible providers who do not have prescribing privileges

CMS announced one more important exemption just before Memorial Day:

d)    CMS will waive the penalty for physicians who missed the June deadline because they plan instead to adopt and use EMRs in 2011 to qualify for meaningful use bonuses. However, these physicians need to apply for a waiver by October 1, 2011 to avoid the penalty. In addition, a Certified EHR must be in place by October 1 to meet the requirements of meaningful use and receive incentive monies.

Our recommendation?  Accelerate your meaningful use initiative!  Be ready by October 1!

While the initial exemptions have little benefit to many larger organizations, this last one could impact over 200,000 providers.  So, fill out the waiver, and get e-prescribe and the other meaningful use criteria up and running by October 1, 2011 to avoid penalties and receive incentive money.

A case in point - one of Hayes’ clients, a Southwestern academic medical center, decided to accelerate its EMR implementation to qualify for 2011 meaningful use incentives AND to avoid the e-Rx “stick.”  By accelerating the planned implementation, nearly $100,000 in penalties will be avoided.

The prospect of penalties for failing to support e-Rx serves as a reminder that we simply can’t ignore the warnings or the “drop dead dates” in hopes that they will abate or move.

Other bigger “sticks” loom, including penalties for failing to support meaningful use. Perhaps the prospect of penalties will increase the participation (beyond the current 41%) of eligible professionals. 

Donald Johnston is a strategy consultant at Hayes Management Consulting who also specializes in Epic implementation planning and project management.