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Meaningful Use Update: Good Things, Small Packages

January 4, 2012
by Mark Hagland
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The CIO of a critical-access hospital talks about the challenges and opportunities inherent in pursuing meaningful use

Patient care organizations of all sizes and types have been moving forward on the meaningful use journey under the American Recovery and Reinvestment Act/Health Information Technology for Economic and Clinical Health Act (ARRA-HITECH). And though there are separate processes for different types of hospitals, there are commonalities among hospitals of all types in terms of their moving forward to embrace meaningful use concepts and strategies.

Washington County Hospital is a 22-bed critical access hospital located in Nashville, a town of 3,258 in a rural, agricultural part of far southern Illinois. The hospital counts 185 employees, 120 of them full-time, and the rest part-time, and has an IT department of four full-time people, one of whom is CIO Kim Larkin. The hospital’s medical staff includes 12 physicians, some of whom are employed. Larkin spoke in early December with HCI Editor-in-Chief Mark Hagland regarding her team’s meaningful use journey to date. Below are excerpts from that interview.

Could you explain for our readers how critical-access hospitals are participating in the meaningful use process under the HITECH Act? Are they participating in a separate program?

It’s all the same program, but how we get paid is different. We are a cost-based hospital under Medicare. And the meaningful use incentives are structured differently. There’s a formula for critical-access hospitals that allows us to recoup the funds invested in our EHRs [electronic health records] based on the costs based on what we’ve spent; it’s based on our Medicare percentages, and in addition, there’s the potential to have a bump of 20-percent over that. Effectively, that put us at 100-percent reimbursement; so for every dollar we’ve spent on meaningful use, we are eligible to have Medicare reimburse us for that. The downside is that we had to have the cash available upfront, which was a challenge. We completed the attestation period on September 30, and we submitted about $740,000 to the feds.

Kim Larkin

Have you received a check yet?

No. I actually did the attestation on the website on October 6. We have to send all our receipts to our fiscal intermediary [in order to move the process forward]. And the week of Oct. 17, I sent in our receipts to the fiscal intermediary. And we actually had to send in copies of paid invoices. And we sent it to our fiscal intermediary, after reviewing every single invoice with the CEO and CFO. The three of us sat down and went through the invoices and made sure we agreed on everything being included. They’re saying eight weeks from submission. And we’re expecting to get about 70-75 percent in that check; the remaining amount will appear in a cost report; that additional 25 percent or whatever it is, when we file our cost report at the end of April 2012, we will file our cost report next autumn; and when we file that cost report, we’ll receive the remaining monies. [As of the date of the publication of this interview, Larkin was waiting to hear about the amount her hospital would receive in its first payment.]

So we had to have the money upfront, which means that there’s a huge cash flow issue for any critical-access hospital. And that amount is huge for us; we basically operate with almost no margin. We’re cost-based, which means that we have no reserves. Some months, we barely break even. Most critical-access hospitals are pretty close on that bubble; they exist, because they provide critical services to their communities. So we have been struggling this last year, 18 months, financially, just because our reserves have been going into IT. We haven’t made any capital investments.

Am I correct that critical-access hospitals would not see reimbursement cuts if they didn’t do this?

Well, we’re not paid based at all on performance, but the consensus among the leaders of critical-access hospitals in Illinois and nationwide, is that at some point, Medicare will require this of us.

You have a very small IT staff with which to accomplish all the meaningful use requirements.

That’s true, but we can also be very nimble. And just because we’re small doesn’t mean we don’t need the voice of the CIO, working with the strategies and the board. We have to do the same things bigger hospitals do. And actually, the patient safety piece around electronic health records probably drove us as much as anything else. So the reason for us doing this now is that we already had the EHR from NextGen [the Horsham, Pa.-based NextGen Healthcare] in our ambulatory clinic.

In fact, we had had ambulatory up and running for three years before we went live inpatient [both with the NextGen solution]. And we had had physician documentation, the medication list, etc., live there. So it was not hard to sell this. And the physicians were literally walking across the hallway between inpatient and outpatient. And we employ physicians in our rural clinic. So we did the entire inpatient implementation without adding a single FTE to the hospital. It wasn’t an option; so we did what we had to do.

How did you do it?

The fact that we were able to do it at all attests to the leadership of our CEO, Nancy Newby, R.N., Ph.D., who had been our CNO before being CEO. She stressed to our board and employees that we needed to do this and had to do this. And when things got difficult, which they always do, she stood firm.

The fact that she’s an R.N. by background probably helped a lot, didn’t it?