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D.C. Report: Budget Battles, Stage 2 Proposals

March 1, 2011
by Sharon Canner, Sr. Director of Advocacy
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Budget Battles Continued. Previously, Advocacy Corner reported on the proposed Continuing Resolution (CR) to fund the federal government for the remaining seven months of the fiscal year. At least at this stage in the game, it appears that health IT funding for the Incentive Program remains in place with no cuts proposed, though close monitoring and continued member education remains important. Health IT funding, however, remains a target for GOP budget cutters. Bills such as the Spending Reduction Act (HR 408, Jordan R-OH-4) would repeal $45 billion in unspent stimulus (Medicare and Medicaid Incentive Program). HR 408 was introduced in January and is pending in 12 House committees. Preserving Patients’ Choices (HR 556, McCotter R-MI-1) would abolish Office of the National Coordinator and the Agency for Research and Quality, state health information technology (HIT) grants, regional extension centers, etc. HR 556 would repeal the HIT infrastructure, which had pre-HITECH bipartisan support. To date, there has been no action on either of these bills.

Moving forward on the FY 2012 budget, President Obama released his budget request earlier this week. With an overall request for $3.73 trillion, he proposes to reduce the deficit by $1.1 trillion over the next decade, two thirds through a five-year freeze on domestic, discretionary spending, cutting more than 200 federal programs, and one third through tax increases. House Republicans have declared his budget “DOA” (dead on arrival) and intend to offer their own version. Included in the President’s Budget is $1 billion in spending increases for the National Institutes of Health (NIH) and $62 billion in Medicare savings over 10 years generated through tighter restrictions on Medicare and Medicaid payments and greater use of generic drugs in federal health programs. These savings are intended to stave off a scheduled 25-percent Medicare physician pay cut.

CHIME Offers Caution on Stage 2 Proposals. Filing comments last week in response to the HIT Policy Committee’s Meaningful Use Workgroup request for comments (RFC), CHIME’s letter pointed to the challenges in evaluating Stage 1 without actual experience. Instead, the recommendations advised deferring Stage 2 until 30 percent of eligible physicians (EPs) and hospitals are able to demonstrate use of electronic health records (EHRs) for Meaningful Use. This approach recognizes reasonable expectations and avoids provider discouragement and would avoid rushed rule-making resulting in repeated FAQs to address provider and vendor confusion. To permit EPs and eligible hospitals (EHs) to elect objectives aligned with internal priorities and capabilities, the CHIME urged retention of a menu set of objectives rather than setting all objectives as core.

Recommendations (due Feb. 25) from CHIME and others will be evaluated with additional input from public meetings in the spring for a subsequent Notice of Proposed Rulemaking due out next summer. CIOs are encouraged to share the CHIIME position with other membership organizations as a means to build support for our position.

The EHR Medicare and Medicaid Incentive Program is an important nationwide initiative to encourage the use of health IT for better patient care. CHIME’s recommendations on Stage 2 are intended as guidance in assuring the program is best able to deliver on its promises within the realities of today’s healthcare environments.