Are EHR Incentives A Waste Of Money?

Critics charge that Meaningful Use incentives only reward longtime users of health IT rather than encourage new electronic health record adoption.
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Of the healthcare providers that received the first batch of federal incentive payments for Meaningful Use of electronic health records (EHRs), around half were using EHRs for several years or longer before the government program began, according to a survey by iWatch News, a publication of the Center for Public Integrity. IWatch News interviewed 62 doctors and hospitals--about a sixth of the total that received incentive payments last spring--to obtain the data for its analysis.

"The analysis could raise questions about whether the government will be able to meet its goal of widespread adoption of health information technology," the iWatch News article said. "While these early numbers are hardly conclusive, they suggest that a large swath of payments intended to be an incentive for new adoption of electronic health records are merely rewarding health providers for minor adjustments to systems they have had in place for years."

Peter Basch, MD, medical director for ambulatory EHR and health IT policy at Medstar Health in Washington, D.C., strongly disagreed with iWatch's conclusions. Basch, a senior fellow on health IT policy at the Center for American Progress, told InformationWeek Healthcare he wasn't surprised that the first bunch of physicians to attest to Meaningful Use included a lot of early adopters. However, he said, "It doesn't indicate there's anything wrong with the program."

The EHR incentive program, he said, is not designed to reward providers who purchase the technology. "It's designed to help move a majority of doctors and hospitals to a 21st century electronic infrastructure in order to provide better and more affordable care. Just putting technology in place doesn't do that. The technology must have certain capabilities, and it must be used in certain ways."

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Only 3,700 physicians had attested to Meaningful Use by September 30, six months after the program began to accept attestations. In Basch's view, that shows it's not easy to demonstrate Meaningful Use, even for early adopters. Some of those who have used EHRs for years had to switch to new systems or pay for expensive updates, he noted.

Even Medstar, which has had EHRs for 15 years, had to make many workflow and documentation changes so that complying with the Meaningful Use requirements would actually improve care, Basch observed. Consequently, the organization waited until the final 90-day period of 2011 to start measuring the performance of the first group of Medstar physicians.

Basch contended it would be unfair to penalize providers who invested in EHRs before January 1, 2010 and only reward those who delayed acquiring the technology. Many of those who invested in EHRs without hope of government incentives, he noted, helped "inform the direction" of health IT toward quality improvement.

It's also nonsensical, he said, to suppose that if early adopters receive incentives, the government is going to run out of money and not be able to make payments to physicians who buy EHRs now. The Centers for Medicare and Medicaid Services estimated that the government would pay out between $14 billion and $27 billion in incentives over five years, and little of that has been spent to date, he pointed out.

The iWatch article quoted several individuals who took pro and con positions on the issue of paying early adopters. Among them was a spokesman for Sen. Tom Coburn (R-Okla.), an obstetrician who has publicly called for elimination of the health IT incentive program. "If providers have been paid for systems they already had in place, that seems to be an inexcusable waste of taxpayer dollars," Coburn's representative reportedly said. "It makes no sense for HHS to pay physicians for systems they already have."

That comment, Basch said, "reflects a misunderstanding of the Meaningful Use program." Rather than being a government subsidy, he said, the EHR incentive initiative represents an investment designed "to induce change in the system so that the government will spend less money on healthcare in the long run."

Nevertheless, in the current political climate, "lots of things are on the potential chopping block that one would have thought were off limits, including Medicare," he pointed out. If it came to a choice between cutting Medicare and eliminating health IT incentives, he said, Coburn's suggestion might be taken seriously. However, he added, "they can't just cut it. It would take a legislative effort to do that."

"That would be a mistake," he argued, because the system can't deliver "better quality and safety and more affordable choices" without health IT.

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