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Meaningful Use: CMS Announces New Deadline and Streamlined Process To Apply For Hardship Exemption

Created by the American Recovery and Reinvestment Act of 2009 (“ARRA”), the Electronic Heath Record Incentive Program – commonly known as “Meaningful Use” – offered incentive payments beginning in 2011 for eligible physicians who attested to meaningful use of an EHR, as defined by regulations. Those carrots, however, soon turned into sticks. 

An eligible physician who did not attest to meaningful use or receive a hardship exception for 2013 saw a 1% penalty on all 2015 Medicare Physician Fee Schedule payments. Those who failed to attest or receive a hardship exception for 2014 now are being penalized 2% in 2016. 

To avoid the 3% penalty in 2017, eligible physicians must attest to having met the Modified Stage 2 Meaningful Use requirements for 90 consecutive days during calendar year 2015. However, CMS did not finalize those requirements until October 16, 2015, meaning that physicians did not have notice of the revised program requirements until less than 90 days remained in the calendar year.

CMS stated that it would grant hardship exemptions to those eligible providers unable to attest due to the lack of timely notice. Under ARRA, however, a provider must submit a detailed application with supporting documentation to secure a hardship exemption, which CMS is required to review and approve on a case-by-case basis.

With the passage of the Patient Access and Medicare Protection Act in late December 2015, however, Congress authorized CMS to grant blanket hardship exemptions for those physicians who apply in a timely manner. On February 26, 2016, CMS released the much-anticipated instructions and application for the blanket hardship exemption. The deadline for submission of the completed application is July 1, 2016 (as opposed to the March 15 date previously announced). 

The application requires completion of basic contact information for the individual submitting the form, a check-the-box “Circumstances of Significant Hardship,” and the name and NPI for each physician on whose behalf the application is being submitted. For physicians claiming lack of adequate notice as the basis for not achieving meaningful use in 2015, the applicable check-box is Section 2.2.d, ERH Certification/Vendor Issues.

CMS strongly encourages electronic submission by attaching the completed application to an e-mail directed to Hardship determinations will be returned via email to the address listed on the application form.

If granted, the hardship exemption will apply only for the 2017 adjustment year. A physician still must achieve meaningful use in 2016 to avoid the 3% penalty in 2018. 

As CMS’ Acting Administrator Andy Slavitt stated publicly on January 11, Meaningful Use as we know it will come to an end in 2016, with the last physician penalties to be assessed in 2018. In its place, the Merit-Based Incentive Payment System (MIPS), Medicare’s new physician value-based purchasing program, will go into effect on January 1, 2019. 

Under MIPS, each provider receiving payment under the Medicare Physician Fee Schedule will be assigned a composite score of 1 to 100 based on four categories of performance measures: quality (30% of the composite score), efficiency (30%), meaningful use of an EHR (25%), and clinical practice improvement activities (15%). Physicians with higher scores will receive bonus payments, while those with lower scores will be subject to penalties. 

CMS is now beginning the process of identifying the specific measures to be incorporated into each MIPS category, including meaningful use of an EHR.  Expect those requirements to be consistent with the Stage 3 Meaningful Use requirements which were published at the same time as the Modified Stage 2 requirements. 

Over the next several months, we will delve deeper into MIPS, explaining in detail this new program’s impact on specialist physicians. For now, however, stay on target to meet the Modified Stage 2 Meaningful Use requirements for 2016 to avoid the 3% penalty in 2018. 

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