January 27, 2010

Electronic Health Record Incentive Programs for Medicaid Providers: How Are States Preparing?

This brief was written by Dianne Hasselman, Center for Health Care Strategies, and Julia Berenson, Center for Health Care Strategies. The Center for Health Care Strategies (CHCS) interviewed Medicaid leaders in six states to better understand how Medicaid agencies are positioning themselves to capitalize on opportunities presented by the American Recovery and Reinvestment Act of 2009. Specifically, CHCS wanted to learn whether states are planning to operate a Medicaid electronic health record (EHR) provider incentive program.

On February 17, 2009, President Obama signed the American Recovery and Reinvestment Act (ARRA) of 2009. These dollars are designed to maintain funding for Medicaid coverage and to invest in much-needed health care infrastructure. ARRA's largest infrastructure investment is in health information technology (HIT), with approximately $44 billion for provider incentives to support adoption, implementation, and use of EHRs. Almost half of it goes to eligible Medicaid providers who adopt EHRs and use them to improve the quality of care. Medicaid agencies also receive 90/10 federal-state match funding for developing and administering the incentive program for Medicaid providers who adopt EHRs. This brief summarizes insights from interviews. During this time, states were just beginning to understand the potential implications of the Centers for Medicare and Medicaid Services? (CMS) proposed rules for an EHR incentive program.