The HHS officials in charge of setting up a national extension service to aid office-based physicians and other providers in the deployment and “meaningful use” of health information technology fleshed out details of the $694 million program during a Web-and-telephone conference Thursday.
As many as 1,250 participants logged- or dialed-in to hear and ask questions about the ground rules to apply for $643 million in grant money to be awarded over a four-year period to about 70 not-for-profit organizations that will run the regional extension centers.
The bulk of the money, $598 million, will be spent in the initial two years, beginning in 2010, getting the regional centers up and running. During that startup period, an estimated 90% of the funding for the regional extension program will come from federal dollars, with the balance coming from state or local matching government funds, foundation grants or fees the centers will be allowed to charge providers for their services.
The government estimates its subsidies of the centers will shrink to $45 million during the second, two-year period, as the centers move to self-sustainability and obtain 90% of their funding from local sources and fees. After four years, the regional centers will be on their own, expected to continue operations on whatever revenue streams they can muster without federal support.
A
formal set of instructions on how to apply for the regional extension service grants and a separate
summary of the program were published last week on the Web site of the Office of the National Coordinator for Health Information Technology at HHS.
Another $50 million has been allocated to a National Health Information Technology Research Center, which will serve as a resource for the regional program.
Grants for the programs will be approved in three flights with the deadline for receipt of “preliminary applications” on the first round of grants set for Sept. 8. It is expected 20 grants will be awarded in the first wave of applicants with $189 million allocated for their use. Another 25 grants with a total cost of $225 million are scheduled to be awarded in the third quarter with the balance coming in the fourth quarter with an allocation of $184 million. Operating costs for the regional extension centers are expected to run from $500,000 to $750,000 per year, with the bulk of the spending expected to go toward provider support services, budgeted at $5,000 per physician.
Each regional extension center is expected to assist at least 1,000 physicians, with the emphasis on primary care doctors in groups of 10 physicians or fewer. Doctors in public and critical-access hospitals, community-health centers and rural health centers may also be served.
The goal of the program is to have more than 100,000 physicians putting EHRs to “meaningful use” in the first two years.
Assisting physicians to select, implement and meaningfully use EHR systems will be a key task for the centers, which may recommend certain systems, according to Farzad Mostashari, who co-hosted Thursday's teleconference and is a senior adviser to the ONC. A physician, Mostashari formerly served in New York City's Health Department as assistant commissioner and chairman of its primary-care information task force.
The regional extension centers can provide “generic” support services to physicians that will serve a wide range of EHR products or they can recommend and provide more in-depth support for a narrow list of vendor systems, Mostashari said.
Individualized and on-site coaching and trouble shooting, he said, “will be a big part of what the regional centers will do.”
“One concern we have is that these extension centers not become proxies for one type of HIT vendor,” Mostashari said. Applicants will be able to identify recommended vendors, but also must issue a statement declaring they have no conflicts of interest with the vendors they have identified, Mostashari said.
A caller-in, Lawrence Ramunno, also raised the issue of potential conflict of interest by state government officials in the grant selection process.
Rammuno is a physician and the chief quality officer for the Northeast Health Care Quality Foundation, the Dover, N.H.-based quality improvement organization for Maine, New Hampshire and Vermont.
Under the grant application guidelines published by HHS, the service areas for the regions can be self defined by the applicant, and can include states or groups of states. But to qualify, applicants for entire states, or groups of states, must obtain a letter of support from the respective state Medicaid program directors.
Ramunno pointed out that quite often existing state and regional HIEs have their state's Medicaid director on their boards of directors. Those HIEs could also be competitors for federal grants under the extension program.
“By any reasonable tenet, this is a conflict of interest,” Ramunno said, adding, thus far, the government's published documents don't address it.
Ramunno also asked why state Medicaid directors were given this key role in passing judgment over the fitness of an applicant for a federal grant program.
“What is a critical role Medicaid is playing in this program as opposed to any other stakeholders, such as a primary-care association?” Ramunno asked. “We're failing to see the connection here.”
Mostashari said there is “a very important relationship, between the extension centers and the Medicaid providers,” calling them “a key constituency” that the extension centers will be working with.
“You identified a potential conflict,” Mostashari said. “We hope that the state Medicaid directors will be acting the in the best interest of the Medicaid providers.” Mostashari said the same subject was brought up regarding federal grants to state HIE programs, but “for the first round, this is what we're dealing with.”
Later, Mostashari said, “We will run this by general counsel to see what they say in terms of the issue that you raise.”
Mostashari said the initial grants will go to those groups that are “already doing this work and are ready to absorb the funding and are ready to go.” That will impart to those first grant recipients a territorial advantage, he said, since the government will not fund two regional agencies covering the same geographical territory.
Territories could be cobbled out of multi-state Census Department-designated metropolitan statistical areas, but with only 70 grants expected and 50 states plus Puerto Rico, Washington, D.C., and other U.S. territories to be covered by the program, it would appear that state-sized programs would be given preference. In fact, scoring on the application process gives weight to programs already underway that have provided IT services to physicians and have full-time staff.
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