Federal Funding for Medicaid HIT Activities

State Medicaid Directors received guidelines from CMS to explain how to get federal funds for investments in health information technology. The States are eligible for 100 percent of of incentive payments and 90 percent funding of their administrative expenses. The guidelines list the three minimum requirements to receive the funds:

  1. Administration of Medicaid incentive payments to Medicaid eligible professionals and eligible hospitals
  2. Oversight of the Medicaid EHR Incentive Program, including routine tracking of meaningful use attestations and reporting mechanisms
  3. Pursuit of initiatives that encourage the adoption of certified EHR technology for the promotion of healthcare quality and the electronic exchange of health information.

The CMS letter Urges the States to find places to save money and avoid duplication in administrative cost. It also encourages States to collaborate with “other State-level and local partners in the design, development, and even procurement of systems needed to administer their EHR Incentive Programs”.

The CMS final rule issued last month defines the three incentive programs for eligible professionals and eligible hospitals. The Medicaid program will yield more money and run for a longer period of time than the Medicare options. The Medicaid programs will be administered and more specifically defined by each state but all states might not be ready for enrollment in 2011 like the Medicare options.