Home Page > Industry Regulations > Meaningful Use > Budget Sequestration: How It Could Affect Meaningful Use

Budget Sequestration: How It Could Affect Meaningful Use

Dollars-SqueezedLiving with sequestration-imposed fee cuts is now a reality for practices, hospitals and health systems across the country. Medicare fee-for-service (FFS) claims with dates-of-service or dates-of-discharge on or after April 1, 2013, will see a two percent reduction in Medicare payment. Claims for durable medical equipment (DME), prosthetics, orthotics and supplies also will feel the two percent pinch. What this means, in essence, is that any Medicare FFS services you now provide are being paid at the rate of 98 cents on the dollar.

As costly as the cuts may be to your budget, there’s another potential price to consider as well; a long-term consequence that could be felt across the entire healthcare industry. It’s the cost to Meaningful Use.

The fee schedule isn’t the only aspect of the Medicare program hit by sequestration. Meaningful Use incentives on the Medicare side are being cut, too. Those who take the long view of the push toward electronic health records (EHRs) and Meaningful Use may be a bit shaken by this fact. For me, the question that jumps to mind is this: How will sequestration impact the effectiveness of future Meaningful Use incentive programs without clearly demonstrated return on investment (ROI)?

Since the inception of Meaningful Use, many have argued that government incentive amounts don’t come close to covering the actual cost of an EHR implementation. With those amounts now being reduced, healthcare organizations may begin to question the program’s integrity and usefulness. The move to an EHR or further EHR adoption for organizations may become even more dependent than ever on taking a much longer strategic view and the system’s potential ROI.

Sequestration may force an unintended consequence: Making healthcare organizations examine whether Meaningful Use incentives really are the only reason for EHR adoption. While the incentives provide much needed assistance in EHR adoption, the benefits provided with greater healthcare interoperability promises to be the catalyst for lower costs and better patient outcomes. This is a journey that has started – the question is, without incentives how fast can we get there?