The Centers for Medicare & Medicaid Services (“CMS”) released the Stage 3 proposed rule to the Medicare and Medicaid Electronic Health Records Incentive Programs (“Proposed Rule”) on March 20, 2015. To provide context, eligible professionals (“EPs”) and hospitals must attest to demonstrating meaningful use of certified electronic health record (“EHR”) technology to qualify for incentive payments through the Medicare and Medicaid EHR Incentive Programs. Failure to demonstrate meaningful use generally results in negative payment adjustments under the Medicare program for EPs and hospitals, unless an EP or hospital qualifies for a hardship exception. The criteria used by CMS to determine meaningful use by providers has evolved over three stages of rulemaking.

Now in Stage 3, the Proposed Rule aims to broaden CMS’s efforts to increase simplicity and flexibility in the Medicare and Medicaid EHR Incentive Programs, while driving interoperability and increasing the focus on improved patient outcomes. It also seeks to further align the Medicare and Medicaid Incentive Programs with other CMS quality reporting programs that use certified health information technology, such as the hospital inpatient quality reporting and the physician quality reporting systems.

The Proposed Rule specifies the meaningful use criteria that EPs and hospitals must meet in order to qualify for Medicare and Medicaid EHR incentive payments and to avoid negative payment adjustments under Medicare. These meaningful use criteria are optional in 2017, but are mandatory beginning in 2018.

Among other proposals, CMS seeks the following in the Stage 3 Proposed Rule:

  • EHR Reporting Period: In the Stage 1 and Stage 2 final rules, CMS established that the EHR reporting period for eligible hospitals is based on the federal fiscal year (October 1st through September 30th). In Stage 3, CMS seeks to change the EHR reporting period so that all providers would report under a full calendar year timeline and eliminate the 90-day EHR reporting period for new meaningful users, with a limited exception under the Medicaid EHR Incentive Program for providers demonstrating meaningful use for the first time. CMS proposes that these changes would apply beginning in calendar year 2017.
  • Meaningful Use Objectives and Measures: CMS proposes a single set of objectives and measures to meet meaningful use, covering eight areas: (1) protection of patient health information, (2) electronic prescribing, (3) clinical decision support, (4) computerized provider order entry (“CPOE”), (5) patient electronic access to health information, (6) coordination of care through patient engagement, (7) health information exchange, and (8) public health and clinical data registry reporting. Each of these objectives has between one and six proposed measures.
  • EPs Practicing in Multiple Practices/Locations. Under current law, to be a meaningful user, an EP must have 50 percent or more of his or her outpatient encounters during the EHR reporting period at one or more practice(s)/location(s) equipped with certified EHR technology. CMS proposes to maintain this requirement.
  • 2015 Edition Certified EHR Technology Required for 2018. CMS proposes that starting with calendar year 2018, all EPs and hospitals will be required to use technology certified to the 2015 edition of EHR technology to demonstrate meaningful use in 2018 and subsequent years. The Office of the National Coordinator for Health Information Technology released the proposed 2015 edition health information technology certification criteria on March 20, 2015.
  • No New Categories of Hardship Exceptions. Under current law, there are several potential hardship exceptions to the imposition of Medicare payment adjustments. These generally include hardship waivers due to insufficient internet access, problems with EHR vendors, lack of face-to-face patient interactions or patient follow up (applicable to EPs), certain types of specialties (applicable to EPs), lack of control over certified EHR technology for more than 50 percent of patient encounters (applicable to EPs), EPs who are new to the practice of medicine and newly formed hospitals, and inability to satisfy meaningful use due to natural disasters or other unforeseen barriers. CMS proposes no changes to the current types of hardship exceptions.

CMS intends for Stage 3 to be the final stage of the meaningful use framework and to incorporate portions of Stage 1 and Stage 2 into its requirements. As a result, Stage 3 will be the single final set of objectives and measures for meaningful use and will eliminate Stages 1 and 2. CMS believes this will reduce provider burden and allow for greater focus on improving outcomes, enhancing interoperability, and increasing patient engagement.

The comment period for Stage 3 ends May 29, 2015.