Coming Soon: Medicare Cuts for Failure to Demonstrate Meaningful Use

Computer KeyboardThe deadline is fast approaching for physicians to file reports and avoid Medicare and Medicaid payment penalties for failing to demonstrate the meaningful use of electronic health records.

Medicare physicians who fail to demonstrate Meaningful Use will be subject to a 1% payment penalty in 2015. Physicians who don’t meet Medicare’s e-prescribing requirements may be subject to an additional 1% cut. Those on Medicaid's Meaningful Use track are not subject to penalties.

How can you avoid these cuts? There are two ways: Demonstrating meaningful use, or receiving a hardship exemption.

Demonstrating Meaningful Use

If you achieved Meaningful Use in 2011 or 2012: You must demonstrate meaningful use for the full 2013 calendar year to avoid the cut in 2015. In subsequent years, you must do so annually to avoid future cuts.

If you achieved Meaningful Use in 2013: You must demonstrate meaningful use for a 90-day period in 2014 using a 2014-Certified EHR to avoid the cut in 2015. The 90 days must be fixed to a specific quarter of the calendar year. In subsequent years, you must demonstrate meaningful use for the full year to avoid future cuts.

If you achieve Meaningful Use in 2014: You must attest to meaningful use by Oct. 1, 2014, and must demonstrate meaningful use for any 90-day period in 2014 to avoid the cut in 2015. To avoid the cut in 2016, you must demonstrate meaningful use for a 90-day reporting period in 2014. To avoid the cut in 2017 and beyond, you must demonstrate meaningful use annually for a full year.

Hospital-based physicians providing at least 90% of their services either inpatient or in the emergency department are not individually subject to these penalties.

Hardship Exemptions

Physicians may also avoid the penalty by applying for a hardship exemption. If accepted, these exemptions are valid for only one year.

Here are some of the circumstances that might qualify a physician for a hardship exemption:

  • Practicing in an area without adequate internet access or other infrastructure barriers
  • New physicians
  • Natural disasters or other unforeseen circumstances
  • Lack of face to face or telemedicine interactions with patients
  • Lack of follow-up need with patients
  • Vendor issues

The deadline to apply for a hardship exemption is July 1, 2014. Apply for a hardship exemption here.

Note: If you successfully acquire a hardship exemption on the Medicare track you avoid the penalties, but you lose one year of incentive payments, which cannot be recouped.

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