EHR payments accelerate for docs, slow for hospitals

Adoption of electronic health records by Medicare physicians is accelerating while the rate of hospitals adding the technology is slowing, according to federal data on the program's spending through February.

Cumulative incentive payments for EHR adoption by physicians reached $636 million, a 57% increase over the previous month, while hospital payments rose to $1.4 billion, or 10% more than the previous month's cumulative total, according to CMS data released by the Medicare Payment Advisory Commission.

MedPAC members highlighted an apparent drop-off in hospital growth trends from previous months. The 10% increase in payments to hospitals for February compares with a 50% increase in cumulative payments to hospitals during December. Also in the last month of 2011, there was a 51% increase in total physician payments.

Members of Medicare's advisory board also noted that provider participation rates remain below the program's projections.

According to the data, released in hard copy at a MedPAC meeting, 3,280 hospitals, or 58% of eligible facilities, have registered with the program, while 126,321 physicians, or 25% of eligible doctors, have done so. Only 796 hospitals, or 16%, have received payments, along with 31,650 physicians, or 6% of those clinicians.

The CMS data indicate that large hospitals with more than 200 beds and those in urban areas are most likely to have received EHR incentive payments. Among physicians, the program has made payments to 8% of primary-care clinicians and 5% of specialists. Cardiology, nephrology and urology specialists had the highest payment rates, with more than 12% of such specialists receiving incentive payments.

Hospital and physician advocates said adoption rates lagged behind projections because of high overall costs and overly burdensome early requirements in the program's regulations, among other factors.

George Miller Jr., a MedPAC commissioner and CEO of Okmulgee (Okla.) Memorial Hospital, said his hospital—one of only 3% of critical-access hospitals to qualify for EHR payments so far—will take four years to recoup its costs to install and implement the digital record-keeping system, even with the incentive payments.