American Recovery and Reinvestment Act (Recovery Act) Health Information Technology:

State EHR Adoption Loan Program

The adoption of health information technology (health IT) is one of the major policy priorities of the recently passed Recovery Act. The Recovery Act package includes $2 billion in appropriated funds to support a series of grants, loans, and technical assistance programs designed to aid providers with the adoption of EHRs and to spur health information exchange at the state, regional, and local levels.

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The Recovery Act authorizes Office of National Coordinator (ONC) to award competitive grants to states to develop EHR

adoption loan programs for health care providers

• Who qualifies? States or Indian tribes may provide loans to health care providers that agree to submit federally-specified quality measurements reports to CMS, use the EHR to exchange health information, and submit a plan for maintaining the EHR over time.

• Level of Funding. The stimulus package is silent on the overall amount of funding that will be devoted to the loan program and does not specify a maximum grant amount. States must provide a cash match equal to $1 in state funds for every $5 in federal funds. States may couple their grants with private sector contributions in an attempt to increase the amount of the loan funding they can offer providers.

• Use of Funds. Providers may use loans to purchase or enhance the use of a certified EHR, train personnel to use EHR, and exchange health information.

• When & How Will Funds Be Awarded. The stimulus package does not include details about the grant application process in which ONC will engage, stating only that the program may begin no sooner than January 1, 2010.

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Health Care Authority potential tasks to take advantage of the EHR adoption loan program.

• Strategic Plan. Include a plan on what projects will be assisted, the distribution of funds and how healthcare providers involved intend to maintain and support the certified EHR technology.

• Secure Funding. 20% match is required. OHCA is requesting SFY2011 funding.

• Third Party Vendor. Secure a vendor that will make loans to health care providers that meet the strategic plan requirements. Report quality data to Health and Human Services (HHS) on any measures adopted by the federal government.

• Contract Monitor / Principal Investigator. Audit the loan program and insure sustainability.

Incentive Description

The Recovery Act provides states the opportunity to incentivize providers to implement electronic health records (EHR) systems. This program does not require a state match. The cost to the state would be an FTE to run the program and the cost of IS changes. Providers implementing an EHR system, meeting specific criteria, will receive incentive payments . The program will be active from SFY2011 through SFY2015. Incentive payment will decrease each successive year as follows:

Incentive Description (con’t)

Incentive payments for facilities with eligible EHR systems will also be available between SFY 2011 and SFY 2015. Incentive payments for facilities will be up to $2,000,000. There is also an additional incentive based upon total discharges (numbering between 1,150 and 23,000) available to facilities. The incentive payments will decrease each successive year as follows:

The formula for facilities considered critical access will result in slightly higher incentive payments.

If 10% of the Oklahoma Medicaid providers and eligible medical facilities participate in the EHR incentive program, it could bring more than $100,000,000 additional federal dollars into the Oklahoma economy.

Timeline

Agency creates a budget request for LOAN state match

Agency creates a budget request for INCENTIVE state match

CMS issues guidance

Apply for LOAN authorization through CMS process

Aug 2009 Sep Oct Nov Dec Jan 2010

CMS award letters

Timeline (con’t)

RFP for Oklahoma bank to operate LOAN

Complete pre-rule process

Board approval of rules

RFP awarded

AugMarch April May JulyJune OctSepFeb 2010

Legislature approves LOAN & INCENTIVEState match funding

Banks able to makeEHR loans

Agency can accept INCENTIVE Applications