Healthcare Business News

CMS offers flexibility on Stage 2, but little time to flex

By Joseph Conn
Posted: May 21, 2014 - 3:00 pm ET

For the second time this year, the federal government was forced to punt on a major health information technology initiative, potentially adding another year before early adopters of electronic health records must meet more stringent requirements of the EHR incentive payment program.

The CMS and the Office of the National Coordinator for Health Information Technology at HHS announced Tuesday that they were issuing a proposed rule that would give hospitals, office-based physicians and other professionals eligible for the EHR incentive program one extra year to use 2011 Edition software for their systems and continue to meet Stage 1 criteria for meaningful use of the technology.

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That means providers that entered the program in 2011 could have as many as four years using 2011 software at Stage 1 meaningful use. The proposed rule also would make official a previously announced delay until 2017 of the start date of what is likely to be the even more difficult Stage 3 meaningful-use requirements now under development.

The move comes less than two months after Congress, responding to industry pressure, put off the nationwide switch to the ICD-10 family of diagnostic and procedural codes until Oct. 1, 2015.

Going into 2014, ICD-10 and Stage 2 deadlines were generally ranked as the two biggest healthcare IT headaches for industry leaders, according to Modern Healthcare's annual IT readers' survey. Now, both have been eased.

“There is a thank you here,” said Russell Branzell, CEO of the College of Healthcare Information Management Executives, a professional association of hospital chief information officers. CHIME lobbied the government hard to give providers more flexibility with Stage 2.

“Our general impression is the proposed rule is a good thing,” Branzell said. But, he added, “It is extremely complex.”

The CMS and ONC rule writers cited the slow delivery and implementation of the upgraded 2014 Edition software (needed for Stage 2) as the reason for the delay. Providers told the CMS in letters, forums, listening sessions and public comments that they were facing long backlogs for installations of updated technology, limiting their ability to attest to meeting the Stage 2 criteria for 2014.

The proposed rule is subject to a 60-day public comment period, which is expected to start Friday when the rule is to be officially published in the Federal Register. The protracted rule-making process virtually ensures that hospital leaders will make a decision without a final rule being in place.

“Even if they (CMS and ONC) nail their timing—the 60-day comment period and they get the final rule and put it out for adoption—that could be four months,” Branzell said. “So, do you roll the dice and collect data on Stage 1, based on this proposed rule, or do you go and try for Stage 2?”

So far, reactions from Medical Group Management Association members have been positive, according to Robert Tennant, its senior policy analyst. “It's not everything we were looking for, but it was a good start and recognition that the program parameters were proving challenging for vendors and their customers. The extra time is going to allow the momentum to continue.”

One concern, Tennant said, is that the proposed rule says the program reverts “back to normal” in 2015, but given the need for delays thus far, “I think the reality is that we as an industry had better make sure we're all moving together. So we're going to be looking hard at 2015 to make sure the vendors are ready for that year. But what we don't want is all of the good effort to stop and the program ends at Stage 1. So I think it's a prudent move, and we appreciate the flexibility.”

Tom Leary, vice president of government relations for the Chicago-based Healthcare Information and Management Systems Society, a trade association for the health IT industry, added his voice to the chorus of those who expressed relief over the proposed changes. But Leary also wondered about timing of a final rule after the 60-day public comment period for the proposed rule ends in July.

“They have a lot of vehicles they can use,” Leary said. “I've seen 30 days, 45 days or 60 days.” If the CMS issues an interim final rule, it could take effect 30 days from publication, he said. “One of the questions we have in to CMS is the timeline on that.”

Some healthcare leaders want other changes to the program.

Dr. Robert Wah, president-elect of the American Medical Association and chief medical officer for systems contractor CSC, said the CMS should relax its requirement that providers must meet every criterion. “I'm worried about no partial credit,” said Wah, who was recently named to Modern Healthcare's list of 50 Most Influential Physician Executives and Leaders.

Dr. William Bria, president of the Association of Medical Directors of Information Systems, a professional association of physician informaticists, said he would rather have seen providers stay the course on Stage 2.

“Will this give relief to someone who is honestly trying?” Bria said. “Sure, but there are other ways to soften the blow” if they fail to make it, such as relaxing the penalties. “But going back to Stage 1, that's kind of wishy-washy; it just makes a political football out of this.”

Follow Joseph Conn on Twitter: @MHJConn

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