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There is a lot of confusion about the HITECH act and its impact on outpatient rehabilitation. Namely, “Will the government give me a rebate if I purchase electronic medical records software?”. The 2009 Economic Stimulus Bill ( The HITECH Act) Analysis: Likely affects on outpatient rehabilitation. On February 17, 2009 the Economic Stimulus Bill, also known as the American Recovery and Reinvestment Act 2009, was finalized The section of the stimulus known as the Health Information Technology for Economic and Clinical Health Act (HITECH Act) discusses stimulus for the Healthcare sector. This legislation will change our industry. As such, it is a “Must Read” for the practice owner. SYSTEM REIMBURSEMENT - The allure Quoting from page 2 of the HITECH Act – “The bill would establish a schedule of Medicare bonus payments, beginning in 2011, that would be paid to hospitals and physicians that adopt and use qualifying health IT”. According to this wording, the HITECH Act will cover some or all of the cost of qualifying electronic medical records software systems to hospitals and physicians only. It appears that outpatient rehabilitation is not included in this program. Details are sketchy, in fact, the bill specifies that most tactical details don’t exist and will be communicated by the end of 2009. One could hope that the same thinking that includes outpatient rehab. in the PQRI (Physicians Quality Reporting Initiative) will also include outpatient rehabilitation in the HITECH stimulus rebate. However, today’s industry consensus is that the HITECH reimbursement for E.H.R. software is intended only for primary caregivers. Details specify that qualifying systems purchased in 2009 will receive credit. PAYOR REIMBURSEMENT RATES - A significant ‘hidden challenge’ Quoting from page 3 of the Act, “Health IT also would help providers reduce their operating costs”. Page 4: These savings “would reduce Medicare spending by $4.4 billion over the 2011-2019 period”. We need to study these words carefully. We interpret this to say that the Congressional Budget Office , CBO, is anticipating technology-driven lower healthcare overhead costs, and (based on this rationale) the CBO is already budgeting to reimburse less. Quoting from page 4: “CBO expects that state Medicaid programs and private insurance plans would negotiate payment rates with providers that would enable those payers to realize most of the savings from reductions in providers’ operating costs”. Page 5 of the Act: “Because accelerating the use of health IT would lower health care costs for private payers, it would result in lower health insurance premiums in the private sector. As a result, private employers would pay less of their workers’ compensation in the form of tax-advantaged health insurance premiums and more in the form of taxable wages and salaries. As written, the HITECH Act, is nothing short of a “silver bullet” for some of our society’s most challenging issues. The HITECH Act promises to: o Lower commercial health insurance premiums o Provide healthcare coverage to millions of additional Americans (funded by savings from lower reimbursement rates). o Lower workers comp. premiums, resulting in higher wages & a larger tax base overall. Regardless of whether or not you believe these benefits will be delivered, the voting public is being promised more for less. We can anticipate strong public support. WE’VE BEEN PUT ON NOTICE – And we have two vital steps. #1. Meet you in the lobby: At it’s core, the Act’s goal is lower medical costs. The Outpatient Rehab. sector must effectively lobby/communicate our message before the HITECH Act’s exact details are written, later this year. The concept of Outpatient Rehab. reimbursement rates being cut, while hospital and physicians are reimbursed over $60,000 for efficiency enhancing software, while often times the need for surgery could have been avoided altogether with physical therapy……is maddening! Hey Congress, ‘want to lower healthcare costs? Try P.T. First! #2. Do the math for your practice – Because the government already has: Tomorrow’s lower reimbursement rates will not pay for today’s manual, paper based workflow. The solution is not to “do more tasks on computers”, you are being forced to “eliminate tasks with electronic medical records software”. Let’s be more specific. Compare your practice overhead to these metrics: - One billing employee to bill/collect up to 1,500 patient visits per month. - One front desk employee to cover all scheduling and benefit administration for up to 42 patient visits per day. - Daily encounter notes in the 60 – 90 second range – with increased compliance. - Point of care eval/re-eval documentation. - Sub 30 day days sales outstanding. The practice owner should calculate the financial impact that these efficiencies would have on overhead costs. Hard work, combined with a state of the art system will deliver these levels of efficiency. Today, these moves increase cash flow and profitability. Tomorrow – They’ll just ‘keep you even’ as reimbursement rates are lowered. THE (VERY) BRIGHT SIDE OF THE PICTURE Medicare’s PQRI reimbursement program rebates 2% of Medicare payments. These rebates will typically pay for more than half of an integrated E.H.R. system’s cost. Ah ha! There is free money for you as well! And let’s not lose sight of the forest for the trees: The government is planning to add tens of millions of new patients to the ranks of “insured Americans”. We are blessed to be in a demographic-driven, growth industry. But to thrive – Outpatient rehabilitation needs to crank up lobbying efforts and each practice owner needs to plan today, for tomorrow’s reimbursement trends.
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