In its attempts to widely disperse and advocate the use of electronic prescribing (or more popularly known as e-prescribing), the Centers for Medicare and Medicaid Services (CMS) has begun providing incentive payments of up to 2 percent to eligible physicians and other health care providers using this technology for the year 2009.

According to the Medicare E-prescribing Incentive Program, prescribers using a qualified e-prescribing system began receiving payments from Medicare starting January 1, 2009.  As the years progress, the reward will drop. For 2011, the 2 percent would become 1 percent and further down to 0.5 percent two years later. Eventually, the incentives would be gone by the year 2013 when it is expected that the technology has been completely adapted.

Along with incentives it also provides penalties for those who don’t comply with the electronic system. From this year until 2011, there is no penalty due to the transition period most physicians would be undergoing. However, by 2012, a -1% penalty would be implied to rise further in the subsequent years; -1.5% in 2013; and -2% in 2014 and the following years. This program is a part of the Medicare Improvements for Patients and Providers Act of 2008.

To be considered a “successful e-prescriber” for 2009, eligible professionals should report the e-prescribing quality measure using their Medicare Part B claims for at least 50 percent of applicable cases on the reporting year. An “eligible professional” is someone who is currently using, or has previously used, a qualified e-prescribing system with estimated charges for the e-prescribing measure codes at least 10 percent of their total allowed Part B charges. This program is also applicable for other health related professionals including: physical or occupational therapists, qualified speech-language pathologists, nurse practitioners, physician assistants, clinical nurse specialists, certified registered nurse anesthetists, certified nurse midwifes, clinical social workers, clinical psychologists, registered dietitians, nutrition professionals and qualified audiologists.

An e-prescribing system is determined to be qualified if it is capable of performing certain unique tasks. First, it should generate a complete active medication list incorporating electronic data from applicable pharmacies. Second, it should allow options to easily select medication, print prescriptions, transmit prescriptions electronically, and conduct all alerts. Also, aside from commonly used medications available in pharmacies, it must provide information on therapeutically approved alternatives at a lower cost. Lastly, it should provide data on formulary or tiered formulary medications, eligibility of patients to the medications, and authorization requirements from the patient’s drug plan received electronically.

The U.S. Department of Health and Human Services still keeps in mind the load it will be to professionals and states that an exemption from the reduction in payment is possible if it is determined that compliance to the requirements of being a successful prescriber would result in hardship. Dr. David Brailer, chairman of Health Evolution Partners and former National Coordinator for Health Information Technology, points out that cost is a great barrier prohibiting most physicians to adapt the new electronic health systems. He states, “The incentives will turn that business case around. My expectation is that the payments will be in excess of what we anticipate physicians’ costs to be.”