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Below I have highlighted and condensed information from the CMS EHR Incentive Program Notice of

Proposed Rulemaking (NPRM) that I believe is pertinent information for our clients to know regarding

Hospital-Based Eligible Professionals (also known as Provider-Based Eligible Professionals).

Hospital- Based Eligible Professionals

The HITECH Act states that hospital-based EPs are not eligible to receive Medicare incentivesand the majority of hospital-based professionals will not be eligible to receive Medicaid

incentives.

o The only hospital-based EPs that will be eligible to receive Medicaid incentives are thosethat practice predominantly in a federally qualified health center (FQHC) or a rural

health clinic (RHC).

The Act defines hospital-based eligible professional as an EP such as a pathologist,anesthesiologist, or emergency physician that provides substantially all of his/her services in an

inpatient or outpatient hospital setting.

oThe Act defines a hospital as an institution that is primarily engaged in providing , byor under the supervision of physicians, to inpatients (A) diagnostic services and

therapeutic services for medical diagnosis, treatment, and care of injured, disabled, or

sick persons, or (B) rehabilitation services for the rehabilitation of injured, sick, or

disabled persons

These EPs that practice predominantly in an inpatient hospital setting will beconsidered hospital-based EPs

o Although the term hospital does not clearly encompass outpatient settings in itsdefinition, the term hospital setting for the purpose of Medicare and Medicaid

incentives includes both inpatient and outpatient settings.

CMS considers an outpatient hospital setting as one that is owned by andintegrated both operationally and financially into the entity, or main provider,that owns and operates the inpatient setting.

o CMS defines substantially all as providing at least 90% of services in a hospitalsetting, either inpatient or outpatient.

o CMS also considers the use of place of service (POS) codes to determine whether or notan EP provides substantially all of their professional services in a hospital setting

This code set was adopted from HIPAA and is used as the national standard forelectronic transmission of professional health claims.

21 Inpatient Hospital is a facility, other than psychiatric, whichprimarily provides diagnostic, therapeutic (both surgical andnonsurgical), and rehabilitation services by, or under, the supervision of

physicians, to patients admitted for a variety of medical conditions.

22 Outpatient is a portion of a hospital which provides diagnostic,therapeutic (both surgical and nonsurgical), and rehabilitation services

to sick of injured persons who do not require hospitalization or

institutionalization.

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23 Emergency Room, Hospital is a portion of the hospital whereemergency diagnosis and treatment of illness or injury is provided

In CMSs proposed rule, a hospital-based eligible professional would be ineligible to receive an

EHR incentive payment under either Medicare or Medicaid, regardless of the type of service they

provided, if more than 90% of their allowed services are identified as being provided in places of serviceclassified under POS codes 21, 22, or 23 based on their claims history from the previous year.

o For Example: an EP would be considered a hospital-based EP and be ineligible for Medicareincentive payments in 2011 if he/she provided 90% or more of his/her allowed services in

places of service coded as 21, 22, or 23 based on their 2010 Medicare claims data.