Overview for Health Care Facilities

Through the Medicaid EHR Incentive Program, acute care and children's hospitals in New York that adopt, implement, or upgrade certified EHR technology, and subsequently demonstrate meaningful use of this EHR technology, can qualify for incentive payments. These payments are above and beyond any Medicaid reimbursement or other incentives. Participation in the NY Medicaid EHR Incentive Program will begin in late 2011.

The following types of facilities are eligible to receive incentive payments:

  • Acute care hospitals, which are defined as hospitals with an average length of stay of 25 days or less, and a CMS Certification Number (CCN, also known as Medicare Provider Number or OSCAR number) whose last four digits are in the range 0001-0879 or 1300-1399. Acute care hospitals must have a minimum of 10% Medicaid patient volume.
  • Children's hospitals, which are defined as separately certified hospitals that predominantly treat individuals under the age of 21 and have a CCN whose last four digits are in the range 3300-3399. Children's hospitals have no minimum Medicaid patient volume.

Under current legislation and program guidelines set by CMS, multi-campus hospitals and health systems that operate under a single CCN will participate in the Medicaid EHR Incentive Program as a single hospital; those that operate under multiple CCNs will be eligible to receive an incentive payment for each CCN that satisfies the criteria listed above.

The total dollar amount of the EHR incentive varies from hospital to hospital according to a formula established by the HITECH Act. This formula takes into account the hospital's size (measured by discharges) as well as the proportion of hospital bed days paid by Medicaid relative to the total number of bed days.

The formula is based on a theoretical four-year payment schedule, but New York has opted to exercise the flexibility granted in the legislation to accelerate the payment schedule to hospitals as follows:

Participation Year Proportion of Total Incentive
Year 1 50%
Year 2 40%
Year 3 10%
Year 4 0%

Note that participation years do not necessarily need to be sequential - eligible hospitals (EHs) may skip years without penalty up to the year 2016. Starting in 2017, hospitals may only receive incentive payments if they received a payment in the previous year.

In order to receive an incentive payment for the first participation year, an EH must demonstrate that it has adopted, implemented, or upgraded certified EHR technology. In subsequent years of participation, EHs must demonstrate that they are meaningfully using the certified EHR technology by satisfying a set of meaningful use objectives, which become progressively more stringent as the program goes on.

Hospitals may simultaneously participate in both the Medicaid EHR Incentive Program and a similar EHR Incentive Program offered through the Medicare program. In order to streamline program administration and reduce the burden on participants, hospitals that demonstrate meaningful use in the Medicare EHR Incentive Program will be deemed meaningful users for the purpose of the Medicaid program and will not be required to separately demonstrate meaningful use to NY Medicaid (although they may still be required to demonstrate any Medicaid- or state-specific eligibility criteria).