What Meaningful Use Means for Health Plans

When Congress passed the HITECH Act last year and changed how physicians, hospitals, and most of the healthcare industry must approach the adoption of electronic health records, health plans weren't a primary target of the legislation. But that doesn't mean the soon-to-be released final definition of meaningful use won't affect how insurers do business.

In fact, many insurers are already looking into ways to follow in the government's footsteps with their own incentives and penalties that will closely mirror the final meaningful use criteria, according to a report from American Medical News.

And they should. Many of the pay-for-performance and cost-control programs that payers are developing depend on providers using health information technology to collect and submit data.

"Adoption and meaningful use of HIT by providers that results in improving the availability and interpretation of clinical quality indicators and measures will certainly improve the efficacy of these types of programs," according to a new report, "Meaningful Use for Health Plans: Five Things to Consider," by technology firm CSC.

In addition, implementing HIT may strain provider resources and lead to cost-shifting to commercial payer contracts, the report says. The more private payers can help physicians and hospitals make the transition, the better off both will be in the long run.

And health plans may be able to have a significant impact on the adoption rate. Although physicians are eligible for up to $44,000 in Medicare incentives over five years, and hospitals can receive millions, many providers still believe that the government payments will not be enough to fully cover the technological and administrative expenses associated with implementing a system from scratch.

But if private payers are developing similar financial incentives that piggyback on the government's payments, the gap between what providers need and what they will receive is suddenly a lot smaller.

"Payers and plans that ignore the challenge that meaningful use and EHR implementation create for hospitals and providers risk missing significant opportunities," according to the CSC report. "Healthcare reform and the ongoing transformation of the healthcare industry are raising the stakes for the payer sector when it comes to successful implementation of EHRs and the demonstration of meaningful use."

There's one more reason payers should be familiar with meaningful use requirements: Medciare Advantage plans will be eligible for quality bonuses beginning in 2012, and it's possible that HIT implementation and meaningful use could somehow be included in the yet-to-be-determined requirements for receiving the bonuses.

Private payers have a long history of following Medicare's lead, and it looks like the same will happen regarding HIT adoption and the development of health information exchanges. But plans aren't just following Medicare blindly. There are clear benefits to encouraging HIT adoption within the meaningful use framework.

This is meant to be an industry-wide transformation. So as we approach the finish line for the initial stages of the program, health plans should be watching what comes out of Washington as closely as physicians and hospitals.