HCA Holdings 2011 Annual Report Download - page 19

Eligible professionals who demonstrate meaningful use are entitled to incentive payments for up to five
payment years in an amount equal to 75% of their estimated Medicare allowed charges for covered professional
services furnished during the relevant calendar year, subject to an annual limit. Eligible professionals must
participate in the incentive payment program by calendar year 2012 in order to maximize their incentive
payments and must participate by calendar year 2014 in order to receive any incentive payments. Beginning in
calendar year 2015, eligible professionals who do not demonstrate meaningful use of certified EHR technology
will face Medicare payment reductions.
The Medicaid EHR incentive program is voluntary for states to implement. For participating states, the
Medicaid EHR incentive program will provide incentive payments for acute care hospitals and eligible
professionals that meet certain volume percentages of Medicaid patients, as well as children’s hospitals.
Providers may only participate in a single state’s Medicaid EHR incentive program. Eligible professionals can
only participate in either the Medicaid incentive program or the Medicare incentive program and can change this
election only one time. Eligible hospitals may participate in both the Medicare and Medicaid incentive programs.
To qualify for incentive payments under the Medicaid program, providers must either adopt, implement,
upgrade or demonstrate meaningful use of, certified EHR technology during their first participation year or
successfully demonstrate meaningful use of certified EHR technology in subsequent participation years.
Payments may be received for up to six participation years. For hospitals, the aggregate Medicaid EHR incentive
amount is the product of two factors: (1) the overall EHR amount which is comprised of a base amount of
$2,000,000 plus a discharge-related amount, multiplied by the Medicare share (which is set at one by statute)
multiplied by a transition factor, and (2) the “Medicaid share,” which is the estimated Medicaid inpatient-bed
days plus estimated Medicaid managed care inpatient bed-days, divided by the product of the estimated total
inpatient bed-days and a charity care factor. Under the Medicaid incentive program, eligible professionals may
receive payments based on their EHR costs, up to total amount of $63,750, or for pediatricians, $42,500. There is
no penalty for hospitals or professionals under Medicaid for failing to meet EHR meaningful use requirements.
Hospital Utilization
We believe the most important factors relating to the overall utilization of a hospital are the quality and
market position of the hospital and the number and quality of physicians and other health care professionals
providing patient care within the facility. Generally, we believe the ability of a hospital to be a market leader is
determined by its breadth of services, level of technology, quality and condition of the facilities, emphasis on
quality of care and convenience for patients and physicians. Other factors that impact utilization include the
growth in local population, local economic conditions and market penetration of managed care programs.
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