Avoiding the CMS eRx Penalty: A Reasonable Solution Emerges

Insomniacs around the country rejoiced last week with the publication of the 1,362 page final rule, which included the 2013 Medicare PFS. Buried in this haystack is an expansion for the exemptions to avoid the eRx penalty. This is welcome news considering a large number of providers have seen their 2012 Medicare PFS reduced by 1% because they were determined not to be successful e-prescribers in the eyes of CMS. According to the AMA there are roughly 135,000 physicians are facing the penalty this year. Sadly, I know there are nephrologists in this group.

 

The needle that resides in this haystack is a resurrection of the eRx hardship exemptions that basically state if you demonstrated meaningful use or you intend to do so during one of the eRx payment adjustment reporting periods, you are exempt from the penalty. The best part about these exemptions is they require almost no work on the physician’s part. Those pressed for time can scroll to the table below for the Cliff notes version of this story. For those along for the ride, let’s look at what this means in plain English, starting with a quick refresher on the concept of the “payment adjustment reporting period.”

 

The eRx Payment Adjustment Reporting Period

 

Providing a glimpse of things to come (the PQRS and Meaningful Use penalties come to mind), CMS established a process for determining whom to penalize for the eRx program, which basically entails surveying provider behavior well in advance of the penalty year. For example, CMS determines whom to levy the 1.5% 2013 eRx penalty against based upon provider actions in either 2011 or the first six months of this year.

 

If, for example, you successfully participated in the 2011 eRx program by sending the eRx G-code to CMS with the claim for 25 denominator eligible encounters (or participated via a PQRS registry), you not only collected a 1% 2011 bonus a few weeks ago, but you will avoid the 2013 penalty. Further, if you applied the eRx G-code to ANY 10 part B claims during the first six months of this year, you will also avoid the penalty. In both circumstances CMS considers you to be a successful e-prescriber and will make sure you do not receive the 1.5% Medicare Part B haircut in 2013. They intend to use the same logic for the 2014 penalty.

 

The only other way to escape the 2013 penalty was to convey one of four hardship exemptions to CMS prior to June 30, 2012. If only things were so simple. We know of several instances where docs did what was expected to avoid the 2012 penalty only to have a clearinghouse or their practice management system strip out the G-codes without their knowledge. In fact several nephrologists have tilted lances unsuccessfully with the folks at QualityNet, the not-so-helpful CMS help desk for incentive programs. The final rule mentioned above provides a glimmer of light that will brighten this picture for many nephrologists.

 

The New “Significant Hardship Exemptions”

 

So what nugget of eRx penalty avoidance lies within the PFS final rule? The following quote from the final rule captures the meat of the issue for the first new hardship exemption:

 

“To qualify for a significant hardship exemption under this category for the 2013 payment adjustment, an eligible professional (or every eligible professional in a group practice participating in the eRx GPRO for the 2013 payment adjustment) must have achieved meaningful use of Certified EHR Technology under the EHR Incentive Program for a continuous 90-day EHR reporting period that fell within the 12-month (January 1, 2011 – December 31, 2011) or 6-month (January 1, 2012 – June 30, 2012) payment adjustment reporting period or for an EHR reporting period that is the full CY 2012. To qualify for a significant hardship exemption under this category for the 2014 payment adjustment, an eligible professional (or every eligible professional in a group practice participating in the eRx GPRO) must achieve meaningful use of Certified EHR Technology under the EHR Incentive Program for a continuous 90-day EHR reporting period that falls within the 12-month (January 1, 2012 – December 31, 2012) or 6-month (January 1, 2013 – June 30, 2013) payment adjustment reporting period or for an EHR reporting period that is the full CY 2012.”

 

Bottom line, if you demonstrated MU during any part of 2011, or if 2012 was your first year of meaningful use and you attested during the 2013 eRx adjustment period (you submitted your MU data prior to June 30th of this year), or you are in year 2 this year and plan to attest prior to January 31, 2013, you qualify for this exemption from the 2013 penalty. Further, if you demonstrate MU in 2012 (your first or second year) or if next year is year 1 of meaningful use and you attest prior to June 30th 2013, you will qualify for the exemption from the 2% 2014 eRx penalty.

 

Okay, take a breath. The second exemption is aimed at those folks who have not demonstrated meaningful use but are on the path to do so. This one basically applies to providers who:

1. Have not previously adopted CEHRT or received an incentive payment under the Medicare or Medicaid EHR Incentive Programs; and
2. Who attempt to participate in the Medicare or Medicaid EHR Incentive Programs during the course of 2012, for the 2013 eRx payment adjustment, or during the 6-month payment-adjustment reporting period for the 2014 eRx payment adjustment (January 1, 2013 through June 30, 2013).

 

The Best Part of This Story…

 

…is that you do not have to lift a finger to make this happen! CMS will do what most of us have thought they should do all along. They will examine the data they are collecting from the CMS EHR Registration and Attestation portal. If you attested for MU during one of the eRx payment adjustment reporting periods, you are exempt from the penalty. If you are a first time meaningful user and you register for the MU program during one of the time frames above, CMS will interpret this to mean you qualify for the second exemption. The part about not lifting a finger is not entirely correct. If you intend to qualify for the second exemption, when you register for the MU program you must enter your CEHRT product number on the registration screen (it is not required until you attest, but it must be there for this exemption to apply). In addition to the new exemptions, CMS has reopened the window for the four original exemptions. This window closes for all six exemptions on January 31, 2013. Table 125 from the final rule summarizes the 2013 exemptions.

 

Table 125: Summary of Significant Hardship Exemption Categories for the 2013 eRx Payment Adjustment

 

 

Help for 2012?

 

I have spent a lot of time thinking about the unfortunate nephrologists who did everything they thought they should do only to find themselves facing the 2012 eRx penalty. If I found myself in this boat, in light of what I have learned about these new exemptions, I would bend somebody’s ear (perhaps our friends at QualityNet) about this. If you demonstrated MU in 2011 and are getting hammered by the 2012 eRx penalty, let them know that if they had adopted this program earlier, you would not be inappropriately penalized this year. If you decide to pursue this, let us know how it goes.