The Department of Health and Human Services (HHS) is seeking public comment on two sets of rules that are designed to modernize and improve the delivery of healthcare services through the use of Health Information Technology (Health IT) pursuant to the mandates in the American Recovery and Reinvestment Act of 2009 (ARRA). These rules, which were issued December 30, 2009, offer the healthcare industry an historic opportunity to demonstrate the clinical value and financial savings that may be realized through the broad implementation of IT.

The HHS Office of National Coordinator for Health IT (ONC) issued an Interim Final Rule (IFR) containing an initial set of standards, implementation specifications and certification criteria for determining whether healthcare providers are making meaningful use of Electronic Health Records (EHRs) in the provision of healthcare. At the same time, the Centers for Medicare and Medicaid Services (CMS), an HHS agency, issued a Notice of Proposed Rulemaking (NPRM) containing proposed regulations for the Medicare and Medicaid incentive payment programs that ARRA makes available to eligible physicians and hospitals implementing certified EHR systems beginning in October 2011. As Wiley Rein previously explained, ARRA allocates some $17.2 billion in Medicare and Medicaid incentive payments to physicians and hospitals to encourage Health IT adoption. ARRA required HHS to issue regulations by the end of 2009 for determining whether eligible physicians and hospitals are meaningful Health IT users to qualify for the incentive payments.

HHS is asking all affected entities to participate in the rulemaking process. Indeed, under ARRA, all healthcare providers, health plans and health insurance carriers that contract with federal government agencies that administer or sponsor a federal health care program (e.g., Medicare) will be required to utilize certified EHR systems when they implement, acquire or upgrade Health IT systems. Comments on the IFR and the NPRM will be due on or before March 15, 2010, which is 60 days from their expected January 13, 2010, publication in the Federal Register.

The meaningful use IFR sets out a three-staged approach for achieving meaningful use of EHRs. It provides an initial set of regulations that certified EHR technology must meet for purposes of sharing healthcare information among providers and with patients. This first stage, which is based upon currently available technology and provider experience, is the first step toward the development of a common vocabulary for clinical summaries, procedures, lab tests, prescriptions, medications and patient conditions. The second and third stages, which are less well defined in the IFR, are expected to be more stringent as EHR technology is improved. Thus, we expect that initial EHR systems will require updates to maintain compliance with the meaningful use rules and eligibility to receive incentive payments.

The IFR also contains proposed criteria for the certification of compliant EHR systems and encourages industry to develop standards to govern the exchange of information between healthcare organizations. It also incorporates privacy and security standards to enable the secure transmission of the information over the Internet. While the rules in the IFR will become effective 30 days after the expected January 13, 2010, Federal Register publication, HHS is seeking comment on the IFR over the next 60 days and the agency will issue a final rule later this year.

The NPRM covers the Medicare and Medicaid incentive programs established under ARRA whereby eligible healthcare professionals and hospitals that make meaningful use of certified EHR systems can receive incentive payments. HHS proposes to define the term "meaningful EHR user" as an eligible professional that, during the reporting period, demonstrates meaningful use of certified EHR technology in a manner that: (i) improves quality, safety and efficiency of healthcare delivery; (ii) improves healthcare coordination and public health; (iii) engages patients and their families in the provision of care and (iv) ensures that personal health information is kept private and secure. Eligible hospitals that demonstrate meaningful use may begin to receive incentive payments in October of this year, while incentive payments to non-hospital-based eligible providers will begin in January 2011.