The Medicare Electronic Prescribing Incentive Program (Program) commenced on January 1, 2009. This Program was authorized by the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) to provide a combination of incentives and payment adjustments for eligible medical professionals deemed to be "successful electronic prescribers." Recently, CMS announced the Final Rule regarding incentive payments and penalties for calendar years 2012 to 2014.
"The Carrot"
Under the Program, medical professionals who are "successful electronic prescribers" will receive an incentive payment in the amount of 1.0% for calendar year 2012. In comparison, for calendar year 2013, the "incentive payment" will be reduced to 0.5%, and there will be no "incentive payment" for the 2014 calendar year. These "incentive payments" will be paid to medical professionals above what they would otherwise be entitled to under Part B of Medicare.
"The Stick"
Within the same Rule, CMS provides that eligible medical professionals who fail to meet the Program's electronic prescription requirements or obtain a hardship exemption will receive a 1.0% payment reduction for 2012. The reduction in payments under the Program will increase to 1.5% for calendar year 2013 and to 2.0% for 2014. Once again, these reductions will apply to all payments under Medicare Part B.
Nevertheless, individual medical professionals can avoid the 2012 payment reduction if they meet criteria set forth in the Final Rule such as if the eligible medical professional is not a physician (M.D., D.O. or Podiatrist), nurse practitioner, or physician assistant and does not have prescribing privileges. Likewise, group practices (defined as 2 or more medical professionals), may also avoid the payment reduction if they reported in 2011 a significant hardship through correspondence to CMS providing specific and required information regarding the group practice and stating the group practice's participation in the 2011 Program. Further, either an individual medical professional or group practice may be able to avoid the penalty if it becomes a successful electronic prescriber for purposes of the 2012 Program.
Finally, individual medical professionals and group practices can request CMS grant them a "significant hardship exemption." Applications for this exemption are reviewed by CMS on a case by case basis and are subject to an annual renewal. The deadline for hardship exemption applications for the 2012 calendar year is November 1, 2011 for both individual medical professionals and group practices.
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