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e-Prescribing Equals Increased Reimbursement


In July 2006, the Institute of Medicine reported that more than 1.5 Million Americans are injured every year by drug errors. E-prescribing is a tool to reduce medical errors and improve quality outcomes. E-prescribing is the “prescribers’ ability to electronically send an accurate, error-free and understandable prescription directly to a pharmacy from the point of care.”1

Some of the benefits of electronically submitting prescriptions are to reduce misinterpreted handwritten prescriptions, correlate a patient’s medical information electronically from multiple providers, fully communicate a patient’s complete medication history instantly, including allergies and readily provide an electronic listing of formulary and benefit information from applicable payors.

Now in addition to improving care, increased reimbursement is another reason to adopt electronic medical records that provide for e-prescribing. In an effort to further support the reduction of medical errors, the Centers for Medicare and Medicaid Services (CMS) initiated a program to increase Physician reimbursement through an e-Prescribing Incentive Program. Similar to the Physician Quality Reporting Initiative, eligible professionals may report e-prescribing measures to CMS in exchange for increased reimbursement from 2009 through 2014.

The initial reimbursement increase is two percent (2%) of the allowed charges for covered professional services furnished by the eligible professional during the calendar year 2009. However, to be eligible for the increased reimbursement, the eligible professional must satisfy specific standards.

First, the individual must satisfy the definition of an “Eligible Prescriber.” An Eligible Prescriber is an eligible professional who reports the e-prescribing measures on at least fifty percent (50%) of the applicable cases as defined by the CMS quality reporting initiatives. Further, the e-prescribing measure codes for professional office and outpatient services must represent at least ten percent (10%) of the total of allowed charges for all such covered services furnished by the Eligible Prescriber. In addition to being an Eligible Prescriber and satisfying the threshold requirement, the Eligible Prescriber must utilize a qualified e-prescribing system.

A qualified system must be able to perform the following:

  1. Generate a medication list;
  2. Allow eligible professionals to select medications, print and electronically transmit prescriptions and conduct safety checks;
  3. Provide information on lower cost alternatives; and
  4. Provide information on formulary or tiered formulary medications, patient eligibility, and authorization requirements that are received electronically from the patient’s drug plan.

Moreover, in order to obtain the incentive increase payment in 2009, the prescribers must successfully report one of three codes for the e-prescribing measure when submitting claims on specified types of medical visits. The code must indicate that either (i) the prescriber did not prescribe any medications, (ii) the prescriber utilized e-prescribing for any medications; or (iii) the prescriber does not use e-prescribing for the medication because the law prohibited electronic prescribing for the specific type of drug, such as a controlled substance. Thus, if an Eligible Prescriber successfully submits the e-prescribing measures and satisfies the requirements described above, the Eligible Prescriber may obtain increased reimbursement.

Notwithstanding the requirements described above, eligible professionals must ensure that they comply with the e-prescribing standards published in the April 2, 2008 Final Rule. Eligible professionals currently using electronic tools to submit prescriptions should evaluate the description of the tools established by the April 2nd e-prescribing standards to ensure compliance. Eligible professionals that are currently evaluating electronic medical record systems should also ensure that any new technology encompasses an e-prescribing program that complies with the accepted e-prescribing standards and the requirements of the e-prescribing incentive program.