By Alex Wayne, CQ Staff
JANUARY 16, 2009 -- Economic stimulus legislation proposed by House Democrats would shower hospitals with millions of dollars in extra funding from the government's health entitlements if they adopt electronic medical records systems, while individual doctors would be paid up to $65,000 for using electronic records in their practices.
All told, Democrats propose to spend $20 billion to encourage the adoption of what is known as health information technology. House leaders released details of the health IT plan on Friday afternoon.
Other health-related provisions include plans to subsidize health insurance or expand Medicaid for people who have lost their jobs since September. Democrats want the government to pay 65 percent of the premiums for up to a year for people who lose their jobs and elect to continue their private health insurance. They would also allow states to temporarily expand Medicaid to cover people who lose their jobs; the federal government would pick up all of the cost.
The provisions were part of a broad Ways and Means Committee proposal (HR 598) that will be added to the broader economic stimulus bill.
Congress has been debating since at least 2005 how to speed the adoption of electronic medical records, which many health experts agree could increase the efficiency of care and cut down on medical errors. Hospitals and physicians have been slow to adopt the technology on their own because of its cost, and privacy advocates have opposed the creation of electronic medical records without allowing patients a great deal of control over their dissemination. Both issues have stymied passage of legislation.
With the stimulus bill, considered must-pass legislation, House Democrats hope to finally end the debate and establish a national policy on the technology.
To satisfy health providers who say electronic medical records are too expensive, Democrats want to dump money on them.
Hospitals would be eligible for additional payments from Medicare and Medicaid of at least $2 million if they adopt electronic medical records before fiscal 2013. Their maximum payments could be much higher—greater than $4 million—depending on a complicated formula that considers their size and the amount of their Medicare payments.
The maximum a hospital could be paid is $11.6 million, according to the Ways and Means Committee, but only if it was a large hospital that accepted just Medicare, Medicaid and charity patients. Almost all hospitals would be paid some fraction of that amount.<?p>
Beginning in fiscal 2016, health providers and hospitals that do not adopt electronic medical records would be penalized with reductions in their Medicare and Medicaid payments.
Physicians who work outside of hospitals would be eligible for their own payments in exchange for adopting electronic medical records, and would also be subject to penalties if they fail to go electronic before fiscal 2016.
The bill includes provisions that will please some privacy advocates. It would require people to be notified in the event of an unauthorized disclosure of their records, and allows patients to request an audit trail showing where their records have been sent.
Health providers would have to obtain consent from patients to use their records for marketing or fundraising purposes. The bill would increase penalties for violating health privacy laws.
And the bill would forbid the data-mining and sale of medical records; many pharmacies currently sell their patient records to companies that in turn collate and re-sell the data to pharmaceutical manufacturers. The practice has long been criticized by privacy advocates.
It is not clear how the health IT language in the bill will be received by lawmakers who have led past efforts to try to pass legislation on the issue or by advocates of strong privacy protections, particularly in the Senate. One Senate GOP aide with an interest in the issue was still reviewing the bill Friday evening but said that it "looked promising."
Democrats said in a summary of the bill that the Congressional Budget Office has estimated that 90 percent of doctors and 70 percent of hospitals would adopt electronic medical records if the measure becomes law.