A new fact sheet issued by the Centers for Medicare & Medicaid Services (CMS) explains hospital payment adjustments under the Medicare Electronic Health Record (EHR) Incentive Program.

Eligible hospitals that failed to demonstrate meaningful use of EHRs for calendar year 2016 are subject to a payment adjustment for fiscal year (FY) 2018, which began Oct. 1. Payment adjustments are applied as a reduction to the hospital Inpatient Prospective Payment System (IPPS) percentage increase for FY 2018. Eligible hospitals that failed to attest will see a 75 percent decrease to the FY 2018 IPPS annual payment update.

CMS has contacted hospitals that did not meet meaningful use requirements or file a timely hardship exception and are therefore subject to the penalty in FY 2018. The fact sheet contains additional information on hardship exceptions, which are granted on a case-by-case basis in four categories:

  • infrastructure;
  • new eligible hospitals;
  • unforeseen circumstances; or
  • EHR vendor issues.

The deadline for FY 2018 hardship exceptions was July 1.

Contact Director of Policy Erin O’Malley at eomalley@essentialhospitals.org or 202.585.0127 with questions