Modifications to the Medicare and Medicaid Electronic Health Record (EHR) Incentive Program for 2014 Final Rule Summary

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1 CY 2014 MPFS Final Rule Summary December 3, 2013 Page 1 Modifications to the Medicare and Medicaid Electronic Health Record (EHR) Incentive Program for 2014 Final Rule Summary SEPTEMBER 2014

2 Page 2 TABLE OF CONTENTS Highlights EHR INCENTIVE PROGRAM MODIFICATIONS: REVISIONS PERMIT PROVIDERS TO ATTEST USING 2011 EDITION CERTIFIED ELECTRONIC HEALTH RECORD TECHNOLOGY (CEHRT) THROUGH What Happened? 3 What s the Impact? 3 What s Next? 3 Highlights / 4 EHR Incentive Program Modifications for CEHRT OPTIONS FOR MEETING MU REQUIREMENTS 5 FINALIZED CLINICAL QUALITY MEASURE (CQM) SUBMISSION REQUIREMENTS IN DELAY OF STAGE 3 MEANINGFUL USE 7 ADDED PROVISIONS FROM THE DECEMBER 7, 2012 IFC 8

3 Page 3 Highlights 2014 EHR INCENTIVE PROGRAM MODIFICATIONS: REVISIONS PERMIT PROVIDERS TO ATTEST USING 2011 EDITION CERTIFIED ELECTRONIC HEALTH RECORD TECHNOLOGY (CEHRT) THROUGH 2014 What Happened? On Friday, August 29, the Centers for Medicare & Medicaid Services (CMS) issued the Modifications to the Medicare and Medicaid Electronic Health Record (EHR) Program final rule. The final rule follows CMS notice of proposed rulemaking (NPRM) issued on May 20. This rule creates flexible CEHRT options for providers unable to fully implement the 2014 edition CEHRT to demonstrate meaningful use (MU) for the 2014 reporting period. What s the Impact? The flexibility in CEHRT options for demonstrating MU in 2014 underscores CMS acknowledgment of industry-wide concerns surrounding the inadequate time for implementing the 2014 Edition CEHRT; however, the flexibility provided will be shortlived. Unfortunately, CMS delayed addressing industry concerns until May, after reviewing data from March 2014 that showed that only 4 eligible hospitals (EHs) and 50 eligible professionals (EPs) had successfully demonstrated Stage 2 of MU using the 2014 Edition. As such, the timing of this final rule only provides a brief period of flexibility. In addition, the flexibility only benefits providers that were unable to fully implement a 2014 Edition CEHRT, and offers no relief to providers struggling to meet more complex Stage 2 requirements. Providers / Unfortunately this flexibility in CEHRT options does not last long all providers must use the 2014 edition CEHRT for the 2015 reporting period, which starts on October 1, 2014 for EHs and January 1, 2015 for EPs. Notably, CMS did not address concerns related to Stage 1 or Stage 2 objectives and measures as those fell outside the scope of the final rule. As such, this rule does not benefit providers who have implemented the 2014 edition and are struggling to meet the more complex requirements surrounding patient engagement and transmission of summary of care records to other care providers. Vendors / This flexibility allows vendors a little more time to get their customers onto the 2014 edition CEHRT. For vendors still working on securing certification, this flexibility allows their customers the ability to demonstrate MU using the 2011 edition in the interim. However, as for providers, the benefits of this flexibility are short-lived and do not alleviate the overall pressure on vendors to upgrade all their customers to the 2014 edition before the start of the 2015 reporting period. What s Next? The finalized proposals go into effect on October 1, CMS will outline the Stage 3 objectives, measures, and reporting requirements in future rulemaking.

4 Page 4 Highlights / Flexibility in Meeting CEHRT Editions and MU Requirements / The final rule allows EPs, EHs, and critical access hospitals (CAHs) to demonstrate MU in 2014 using 2011, 2014, or a combination of 2011 and 2014 Edition CEHRT. This is a significant change from the Stage 2 EHR Incentive Program Final Rule released in August 2012 that required all providers to demonstrate MU using the 2014 Edition CEHRT in 2014 and beyond. This change applies to providers participating in Stages 1 or 2 of the Medicare and Medicaid EHR Incentive Programs. Stage 3 Delayed Until 2017 / CMS will extend Stage 2 for providers that began demonstrating MU in 2011 or 2012 by one-year Stage 3 for these providers will now begin in 2017, instead of Exemption for the Stage 2 Summary of Care Objective / CMS will allow providers that are unable to meet the Stage 2 summary of care objective because the majority of the providers they refer to were unable to fully implement 2014 Edition CEHRT to attest to the 2014 Stage 1 objectives and measures for the 2014 reporting period. Finalized Clinical Quality Measure (CQM) Reporting Requirements in 2014 / CMS finalized their proposal requiring all EPs and EHs to select and report on CQMs from the relevant sets adopted in the Stage 2 final rule, regardless of their MU stage or year of participation in the EHR Incentive Program.

5 Page 5 EHR Incentive Program Modifications for 2014 CEHRT OPTIONS FOR MEETING MU REQUIREMENTS Flexibility in Meeting CEHRT Editions and MU Requirements / CMS finalized its proposal to allow EPs, EHs, and CAHs that were unable to implement 2014 Edition CEHRT three options for meeting MU in CMS clarified that providers are only eligible for the flexible options if they were delayed in fully implementing 2014 Edition CEHRT due to delays in software development, certification, testing, and/or release of the EHR product by the EHR vendor. The three options are outlined in Table 1: Table 1. Options for Demonstrating Meaningful Use in 2014 YOU WOULD BE ABLE TO ATTEST FOR MU: IF PLAN TO DEMONSTRATE: OPTION 1: USING 2011 EDITION CEHRT OPTION 2: USING A COMBINATION OF 2011 AND 2014 EDITION CEHRT OPTION 3: USING 2014 EDITION CEHRT Stage 1 in 2014 (for providers that began demonstrating MU in 2011) Stage 2 in 2014 (for providers that began demonstrating MU in 2011) Meet 2013 Stage 1 Meet 2013 Stage 1 objectives and measures * Meet 2013 Stage 1 OR Meet 2014 Stage 1 Meet 2013 Stage 1 requirements* OR Meet 2014 Stage 1 OR Meet Stage 2 objectives and measures* Meet 2014 Stage 1 objectives and measures Meet 2014 Stage 1 OR Meet Stage 2 objectives and measures *Only for providers that could not completely implement 2014 Edition CEHRT for the 2014 reporting period due to delays in that technology s availability are eligible for the options outlined in Table 1 When attesting, providers will be able to select one of the three outlined options; the EHR Incentive Program Registration and Attestation System will prompt providers to meet their appropriate requirements automatically. CMS highlighted that delays related to financial issues (i.e., inability to pay for 2014 Edition CEHRT), inability to meet Stage 1 or Stage 2 requirements, staff changes and turnover, and provider s inaction or delay in implementing 2014 CEHRT do not constitute an acceptable reason for being unable to implement 2014 Edition CEHRT due to technology availability limitations. Providers scheduled to begin Stage 2 in 2014 that instead meet Stage 1 criteria in 2014 due to technology availability limitations must demonstrate Stage 2 for the entire year in In 2015, all providers, except those in the first year of MU, must have 2014 Edition CEHRT to successful demonstrate MU. Overall, the revision would make

6 Page 6 the first day of FY 2015 (for EHs and CAHs) and CY 2015 (for EPs) the new required start date for exclusive use of 2014 Edition certified Complete EHRs and EHR Modules to meet the CEHRT definition. Providers must attest to the appropriate objectives and measures required by the CEHRT Edition they attested with; there are no options to attest a mixed set of objectives or split the CQM reporting. Providers must retain all supporting documentation used in the EHR Registration and Attestation System for six years post-attestation. CMS clarified that providers that are unable to demonstrate MU in 2014 may apply for a hardship exception for the 2016 payment adjustment any time before April 1, 2015 for EHs and CAHs and July 1, 2015 for EPs. CMS will Work with States to Support these Policy Changes / CMS will provide ongoing technical assistance and appropriate materials to state staff and providers to help them understand how the changes in this rule affect participation in the Medicaid EHR Incentive Program. To Receive Medicaid EHR Incentive Payments for Adopt, Implement, Upgrade, EPs Can Only Adopt 2014 Edition CEHRT / To discourage EPs from purchasing outdated EHR products that would hinder the provider from meeting MU requirements in subsequent years, Medicaid EHR incentive payments require EPs to adopt the 2014 Edition CEHRT. Allow EHs and CAHs Unable to Meet the Stage 2 Objective to Provide a Summary of Care Document for Transitions of Care to Attest to 2014 Stage 1 / CMS recognized that referring EHs and CAHs may not be able to meet the Stage 2 summary of care objective to provide a summary of care record for 10 percent of transitions of cares or referrals in 2014 if the providers they typically refer to do not have 2014 Edition CEHRT. As a result, CMS is allowing providers who are unable to meet this objective the flexibility to attest to the 2014 Stage 1 objectives and measures for the 2014 reporting period. Providers must document and demonstrate that they were unable to meet the 2014 Stage 1 summary of care objective as a result of working with providers that experienced delays related to the availability of 2014 Edition CEHRT. CMS did not provide any other changes to the objectives and measures for Stages 1 and 2 in this final rule. Any changes to MU requirements will be outlined in the Stage 3 proposed rule. FINALIZED CLINICAL QUALITY MEASURE (CQM) SUBMISSION REQUIREMENTS IN 2014 The reporting options and mechanisms for CQM reporting depend on the edition of CEHRT that a provider uses for the EHR reporting period in 2014 as outlined in Table 2:

7 Page 7 Table 2. Attestation and CQM Reporting Requirements CEHRT EDITION 2011 CEHRT Only 2011 and 2014 CEHRT 2014 CEHRT only ATTESTATION AND CQM REPORTING REQUIREMENTS EPs would report from the set of 44 measures in the Stage 1 Final Rule: Three core/alternate core; Three additional measures; and Reporting period: any continuous 90 days within CY 2014 for first-time MU demonstrators or a 3-month CY quarter for EPs that have previously demonstrated MU. EHs and CAHs would report all 15 measures finalized in the Stage 1 Rule Reporting period: any continuous 90 days within FY 2014 for first-time MU demonstrators or a 3-month FY quarter for hospitals that have previously demonstrated MU. Providers who use a combination of 2011 and 2014 CEHRT have two choices for CQM attestation: 1. Report 2013 Stage 1 CQMs using the same attestation measure sets and reporting criteria as 2011 CEHRT users in 2014, OR 2. Report CQMs using the requirements established in the Stage 2 final rule. Providers must submit CQMs in accordance with all requirements and policies established in 2014 for the entire duration of reporting in 2014, regardless of the stage of MU that the provider chooses to meet. Reporting period for EHs: Any continuous 90 days within FY 2014 for first-time MU demonstrators or a 3-month FY quarter for hospitals that have previously demonstrated MU. Reporting period for EPs: any continuous 90 days within CY 2014 for first-time MU demonstrators or a 3-month CY quarter for EPs that have previously demonstrated MU. A provider may also report a full year of CQM data if they so choose. Finalized CQM Submission Process / Although CMS acknowledges the concerns of some providers regarding CQM reporting such as the lack of backward compatibility of 2014 Edition CEHRT to 2011 CQMs and maintaining older measure versions that cannot be electronically reported, they finalized the CQM submission as proposed in the table above. Medicaid EHR Incentive Program / Reporting of CQMs will continue to be at the State s discretion, subject to CMS prior approval. DELAY OF STAGE 3 MEANINGFUL USE Stage 3 Delayed Until 2017 / CMS will extend Stage 2 for providers that began demonstrating MU in 2011 or 2012 by one-year. These providers will now transition to Stage 3 in FY 2017 for EHs and CAHs and CY 2017 for EPs. Originally, these providers would have been required to transition to Stage 3 in 2016; however, given the challenges in achieving Stage 2, CMS is focusing its efforts on supporting providers in implementing the Stage 2 requirements and plans to use data from Stage 2 to inform future rulemaking for Stage 3. The original timeline for providers that first demonstrated MU in 2013, 2014, and in subsequent years will remain unchanged.

8 Page 8 FIRST PAYMENT YEAR STAGE OF MEANINGFUL USE * 3 3 TBD TBD TBD * 3 3 TBD TBD TBD TBD TBD TBD TBD TBD TBD *extend Stage 2 and delay Stage 3 Red Line = payment adjustments begin in 2015 for providers who do not demonstrate MU by 2014 ADDED PROVISIONS FROM THE DECEMBER 7, 2012 IFC Newer Versions of the DEC and QRDA III / CMS has adopted and incorporated newer versions of the Data Element Catalog (DEC) and the Quality Reporting Document Architecture (QRDA) Category III (QRDA III). Finalized revisions proposed in the 2012 Medicare and Medicaid EHR Incentive Programs Interim Final Rule / CMS finalized the following revisions initially proposed in the 2012 interim final rule titled Health Information Technology: Revisions to the 2014 Edition EHR Certification Criteria; and Medicare and Medicaid Programs; Revisions to the EHR Incentive Program: Adopted an alternative measure allowing for calculating all lab orders received rather than just those received electronically in a Stage 2 objective for providing electronic laboratory results to ambulatory providers. Corrected the regulatory text describing the objective to provide patients the ability to view online, download and transmit information about a hospital admission, the final rule added the word unique to clarify that calculations are based on the number of unique patients discharged from a hospital s inpatient or emergency department during the EHR reporting period. Finalized the adoption of a case threshold exemption provision for eligible hospitals and CAHs in all stages of MU beginning with FY Eligible hospitals and CAHs with 5 or fewer discharges during the relevant EHR reporting period (if attesting to 90-day EHR reporting period) or 20 or fewer discharges during the year (if attesting to a full year EHR reporting period) could claim an exemption for that CQM.

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