Stimulus Package and Pediatricians

I've had a lot of surprisingly hopeful emails hit me referring to all the "free money" docs expect to get as a result of the Obama stimulus package.  Put your cynical hats on, folks, because if you think that the HIT-driven stimulus money as it's designed right now is going to benefit you or your patients, you are mistaken.

First, let's look at the macro-economic issue.  I, and others in this business, feel like the stimulus money will ultimately prop up old-style vendor solutions, none of whom are obviously serving the community well.  Further, tying the $$ to a non-market-driven certification process (c'mon, anyone think it isn't going to be CCHIT?) is going to further drive away the innovation and specialization so needed in this business. This looks exactly like the way we treated Detroit for many years and look what that has gotten us.

Second, let's look at the micro-economic effect.  I can't believe people don't see the problem here.  What do you think is going to happen to the real costs for a new EHR if the vendors think that you're good for an extra $40-70K/doc over the next 5 years?  Do you actually think that physicians are anything more than a conduit through which the money will go from the tax payers to the EHR vendors?  How much of this stimulus $$ do you think will really be found in your margin?  $5000?  $10000 over 5 years?  Is that really even worth talking about, if it leads you to choose the wrong EHR?

That's crazy.  But it's already happening.

Finally, as pediatricians, you have to take specific care.  Here's something John Canning put together informally for our clients.  Take heed. If you're not 20% Medicaid, you're not getting any $$, it looks like.

Greetings -

Like Chip, I serve on a CCHIT Work Group. My group deals with
Privacy (HIPAA) and Compliance. Our meeting today eventually turned to
the Stimulus package and how it will support IT spending for healthcare
(i.e., EHRs).

We received a copy of a very informative presentation after our
lengthy discussion. It does a great job of summarizing the Medicare and
Medicaid incentives for both physicians and hospitals. I learned some
interesting things about the Medicaid money and pediatricians:

1. In order to qualify for funding, at least 20% of the patient
volume at a practice must be from patients receiving medical assistance
(it doesn't say if we are measuring volume based on visits, people, or

2. Each state gets to decide whether or not they will pass on this stimulus money to their Medicaid providers;

3. Each state gets to decide what is required for certification (you must have a certified EHR in order to receive money);

4. There is no indication when the money will first become available, although folks are assuming it will be in 2011;

5. Interestingly, pediatricians only qualify for 2/3 of the federal funding described in the stimulus bill (2/3 of $65,000);

6. I am not clear on how practices that are already using an EHR
would fair under this plan. Some of the wording implies they must begin
using a system in 2010.

All of what I am reporting is based on what is written in to the
bill that was signed by Obama. It's still up to the Department of
Health and Human Services to decide how they are going to actually
implement this. Let's hope they move faster with this program than they
did with HIPAA (it was signed in 1996; the law mandated it go into
effect in 1998, but it didn't really go into effect until 2003).