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Use the Meaningful Use Tax Incentive for Your Electronic Medical Record Technology? What You Must Do Legally.
October 27, 2016 at 4:00 AM
by My IT
One dollar bill by the wall

As part of the American Recovery and Reinvestment Act (AARA) enacted on February 17, 2009, Congress created a tax incentive program called Meaningful Use to incentivize healthcare providers including doctors, hospitals, critical-access hospitals, and Medicare Advantage Organizations to convert their PHI (Protected Health Information) to electronic versions known as ePHI (Electronic Protected Health Information). This program encouraged small single-doctor practices and large hospitals to utilize approved Electronic Health Records (EHR) systems. [Note: We use the term EHR instead of EMR (Electronic Medical Records) because EHR refers to the overall health of a patient compared to purely the medical conditions and treatment for a patient found in EMR.]

Besides assisting in the economic recovery, Congress passed this bill for eligible providers to adopt, implement, upgrade, and demonstrate meaningful use of certified EHR technology in order to create the electronic exchange of health information to improve the overall quality of health care by submitting clinical measurements.

What’s the ROI of Meaningful Use?

Meaningful Use provides the typical clinician:

  • Medicaid: Incentives up to $63,750 over six years to Eligible Professionals (EP) who to adopt, implement, upgrade or “meaningfully use” certified Electronic Health Record technology.
  • Medicare: Incentives of up to a maximum of $44,000 over five years per EP who meets the eligibility requirements and “meaningfully use” of certified Electronic Health Record technology.

The clinicians eligible for incentive payments vary:

  • Medicaid: Includes physicians (MD & DO), nurse- practitioners, physicians, dentists, and certified nurse-midwives.
  • Medicare:  Medicare defines a physician to include MD, DOs, oral surgeons, chiropractors and optometrists.

Specifics about the Meaningful Use program

Ultimately, Meaningful Use came out in multiple stages. Stage 1 set the foundation for the incentive programs by “establishing requirements for the electronic capture of clinical data, including providing patients with electronic copies of health information.” (Source:

Stage 2 expanded the focus to ensure the program supported the mission of the National Quality Strategy and encouraged medical providers to use “ IT for continuous quality improvement at the point of care and the exchange of information in the most structured format possible. We [CMS] are developing a centralized repository for public health agency and clinical data registry reporting to help eligible professionals, eligible hospitals, and critical access hospitals (CAHs) find entities that accept electronic public health data.”

Stage 3 of Meaningful Use improves upon the quality of the program, promotes interoperability, and focuses on three components – cost, access, and quality. CMS set eight objectives and measurements:

  • Protect Patient Health Information
  • Electronic Prescribing
  • Clinical Decision Support
  • Computerized Provider Order Entry
  • Patient Electronic Access to Health Information
  • Coordination of Care through Patient Engagement*
  • Health Information Exchange*
  • Public Health and Clinical Data Registry Reporting*

The asterisk (*) notes flexibility to what you must attest to and report to CMS.

Meaningful Use Requirements

Keep in mind, if you are a Medicare EP and do not demonstrate a meaningful use of certified EHR technology by 2016, your Medicare payments will be reduced by 1% in 2015; 2% in 2016; and 3% in 2017.

The Centers for Medicare and Medicaid (CMS) Services define “Meaningful Use” as eligible providers using a certified EHR technology product for at least 90-days in the payment year and for a full twelve months in subsequent years. Also, EPs must register at the CMS website. Medicare providers will attest that they have meaningfully used a certified EHR (Electronic Health Records) technology on that website while Medicaid providers must complete that step with the state Medicaid agencies.

CMS provides this chart to determine what stage of Meaningful Use is needed each year depending on the first year you demonstrated usage.


The legislation also requires every medical provider utilizing the Meaningful Use tax credit to do risk assessments. This step is often missed and the repercussions can be extensive.

The required Meaningful Use assessments must include:

  • You must note the location and storage of all ePHI, how it moves within and in & out of the organization, and it must identify all security vulnerabilities to both PHI and ePHI.
  • You are required to assess the possible risks to your ePHI’s confidentiality, integrity, and availability.
  • You need to identify how you will protect your PHI from any reasonably possible threat and identify how you will eliminate, avoid, or minimize those risks.

The scary part is that most medical organizations are NOT compliant – and the HHS knows it too! They list the compliancy of practices on their website by state.  For example, in Louisiana 60.6% of office-based physicians in 2013 did NOT met the criteria for meaningful use of electronic health records!

I’m not sure your thoughts, but I wouldn’t want to be on the wrong end of that; using a tax credit and not doing the mandated elements.