Providers frozen out of a $27 billion federal fund for conversion of medical records to electronic form are now fighting back in an effort to qualify for the money and possibly increase the size of the pot. The results of these multi-front battles are uncertain — but they are representative of a larger war. All over Washington, special interests are scrambling to improve their position by attempting to renegotiate portions of Obama’s health care reform — in new regulations, interpretations and proposed legislation.

The new money for health information technology, or health IT, is the result of the Health Information Technology for Economic and Clinical Health (HITECH) Act, which was part of President Barack Obama’s massive economic stimulus legislation in 2009. The idea was to allot stimulus funds to Medicare and Medicaid, which would then distribute the money to providers who demonstrated they were using electronic records to improve patient care.

But like a lot of spending decisions in Washington, this one ended up choosing winners and losers. In the weeks leading up to the stimulus bill’s passage it became clear that the $50 billion Obama had promised during his campaign wouldn’t fly. In the end, some health care providers were shocked to discover they would not be eligible to participate in the program because Congress had narrowed the criteria and limited HITECH’s pricetag to $27 billion. But they’re not giving up. Among those lobbying anew with lawmakers and rule-writers are groups representing behavioral health providers, rural health centers and home-care practitioners.

Causes of exclusion

The conversion of medical records to digital form has been a long-sought goal of health care reformers, and the idea of funding federal investment to make it happen has been around for a while. Representatives of various health sectors were lobbying Congress and helping to craft legislation in 2007, said Tina Olson Grande, senior vice president for policy at the Healthcare Leadership Council. In the fall of 2008, Rep. Pete Stark, D-Calif., chairman of the House Ways and Means health subcommittee, sponsored a bill in which incentives were specifically promised to physicians and hospitals. That measure never got out of committee, but it provided a template for the HITECH bill that emerged as part of the $787 billion stimulus package, the American Recovery and Reinvestment Act, which Obama signed on Feb. 17, 2009.

Like most legislation, the economic stimulus was altered by fast-moving negotiations. Exactly how the HITECH winners and losers were decided remains a bit murky. Though it had been widely reported months ahead of time that the health IT effort would receive $50 billion, the Congressional Budget Office ultimately scored the initiative at about $20 billion.

Physicians, chiropractors, dentists, optometrists, podiatrists, psychiatrists and most hospitals were made eligible to receive the incentive payments. But nurses, physician’s assistants, behavioral health providers, home-care practitioners, emergency medical services, long-term care providers, post-acute providers, federally qualified health centers, rural health centers, rehabilitation hospitals and cancer centers were excluded from participation in parts or all of the program.

“Those providers who were included had an inside track,” said Al Guida , a lobbyist for the behavioral health community. “By the time it came out and you realized you were left out, there was little time to lobby the process to get yourself back in.”

Guida said behavioral health providers also “tactically … shot ourselves in the foot” by focusing their lobbying efforts on addressing protections regarding the security and privacy of personal health information, only to discover that even though those demands were met no behavioral health providers would qualify for the cash rewards.

The groups that were excluded, said Dylan Roby , assistant professor of health policy at UCLA’s School of Public Health, have historically been less successful in getting Congress to support their agendas than those who were included.

House Energy and Commerce and Ways and Means committee staffers met with non-eligible providers after the bill was drafted and explained that they wanted to maximize effects with limited funds, rather than try to spread the money over a greater number of providers and possibly have less impact, said Rich Brennan, executive director of the Home Care Technology Association of America.

The final bill did specify that the Department of Health and Human Services (HHS) was to file a report to Congress in June 2010 regarding the progress made by providers who were left out, but that effort hasn’t yet amounted to much. An interim report issued in July 2010 says only that the department awarded $561,632 to the National Opinion Research Center at the University of Chicago to conduct the study. That document said a final report would be issued in December 2010, but no final report has yet appeared; HHS officials told iWatch News the document would be delivered by the end of 2011.

Influencing Efforts

Backers of expanding eligibility and funding for health IT improvements say allowing all providers access to funds would improve health for patients and cut back on costs in the long run. One medicine or disorder can often impact another, they say, and patients cannot be provided coordinated care unless the technology spans across all health fields.

Ever since the stimulus passed, excluded health care providers have drafted legislation, spent thousands on lobbying, posted their arguments on public-comment boards, sent letters and met with members of Congress and HHS officials to push the government to include more groups in the program.

The effort is but the latest example of health interests seeking to revisit portions of Obama’s health care reform plan. An April iWatch News piece focused on efforts by medical device makers to exclude themselves from a 2.3 percent excise tax slated to pay for expanded health coverage. Another iWatch News piece the same month detailed insurance brokers’ attempts to seek a rule recalculating how much insurers could spend on administrative costs.

The effort to expand health IT funding has been led by the behavioral health community, representing providers such as clinical psychologists, clinical social workers, psychiatric hospitals, substance abuse treatment centers and mental health treatment centers.

These providers have been lobbying together since May 2010, and in March formed the Behavioral Health IT Coalition. The group is pushing the Behavioral Health Information Technology Act , a measure introduced in March by Democratic Sen. Sheldon Whitehouse from Rhode Island that is designed to expand funding for health IT. Republican Sen. Susan Collins from Maine and several Democratic senators signed on to cosponsor the legislation in May.

If the bill does not pass on its own, Guida says, the behavioral health coalition will try to attach it as an amendment to another piece of health care legislation at the end of the year. The group’s lobbying firm, Guide Consulting Services, received $90,000 for lobbying in Congress during the first quarter of this year on health IT and other health reform-related bills.

A separate bill would assist federally qualified health centers, which receive government grants to provide health care to underserved communities, and rural health clinics. The Fix HIT Act, introduced in March by Michigan Democrat Debbie Stabenow on the Senate side and Illinois Republican Adam Kinzinger on the House side, would amend HITECH to qualify health centers for incentive payments paid through Medicaid.

The Congressional Budget Office has not scored the bills, nor has the Obama administration issued a statement of administration policy about them. The Senate bills have been referred to the Committee on Finance and the House bill has been referred to the Energy and Commerce Subcommittee on Health.

Other providers excluded to date from the health IT funding are taking a more moderate approach. The American Academy of Physician Assistants has expressed its concerns to HHS, and sent a letter to targeted members of Congress recommending that HITECH be amended to extend Medicaid incentives to physician assistants if at least 30 percent of their patients are on Medicaid.

“The current HITECH limitation on Medicaid [electronic health records] limits the development of EHR systems for Medicaid beneficiaries who are served by PAs,” they wrote. “PAs are often the sole health care professional in medically underserved communities.”

Rescue squads and other emergency medical services providers are also not qualified to receive reimbursement under the law because they fall primarily under the jurisdiction of the Department of Transportation, not HHS. Because the role of emergency services is often misunderstood, “we get left out of virtually everything Congress does,” said Gary Wingrove, a volunteer leader of the National Rural Health Association who has EMS experience. The group has focused its efforts on raising awareness of its role to make sure future health care policies can apply to them.

Other groups are concluding they would rather not take part in the program — because it not only provides incentive payments now, but also holds out the prospect of penalties several years from now for not implementing technology that adheres to government standards.

The Home Care Technology Association of America has made the office of the National Coordinator for Health IT (ONC) at HHS aware of its feelings on the funding issue by submitting a public comment via the department’s website.

“Our industry envisions a future where the integration of EHRs, remote monitoring and community based services will be the backbone of the national health care delivery system,” they wrote. “Therefore, information sharing amongst physicians and hospitals with home care and hospice providers will be critical to advancing care coordination efforts and reducing re-hospitalizations.”

However, Rich Brennan, the group’s spokesman, said the association was mostly focusing current efforts on a separate measure, the Fostering Independence Through Technology (FITT) Act , which would encourage Medicare reimbursements for audio and video home monitoring.

Looking Ahead

Dr. Farzad Mostashari , who was appointed as the new national coordinator for health information technology in April, told iWatch News he does not think ONC can meets its goal of improving care through health IT unless all providers are able to help track patient records throughout their lifetime and across different medical conditions.

But he also said that the prospect of passing pending legislation to expand the stimulus to other providers would be an “uphill battle.” Other experts agree, especially in light of the government’s current fiscal challenges.

Even the existing funding could be threatened. A pot of billions of dollars such as that set aside for HITECH, particularly as it has sat unspent for two years, is potentially an attractive target for budget cutters at a time of escalating debt. The HITECH language specifically required that the money be appropriated ahead of time, allowing for a timeline that would give health practitioners the opportunity to begin implementing the required technology, demonstrate results and then apply for government reimbursements.

Even now, two bills are pending in Congress to rescind HITECH funds for the purpose of beginning to pay down the country’s $14 trillion debt. In January, Republican House member Jim Jordan of Ohio introduced the Spending Reduction Act, which proposes — among other cuts — eliminating $45 billion in unspent stimulus dollars, including the funds for HITECH. In February, Republican Thaddeus McCotter of Michigan introduced the Preserving Patients’ Choices Act, which specifically proposes repealing health care-related stimulus appropriations. The two bills have been referred to committee.

The fact that little cash has been awarded could also encourage a rescinding of funds, experts say. Starting in January, 13 states have now launched the program in which incentive payments through Medicaid are disbursed. Though the Centers for Medicare and Medicaid Services says it is pleased with the participation so far, only eight states have actually made Medicaid payouts — totaling just $83 million. Payments through Medicare began just this month, as had been scheduled in HITECH.

Stephen Zuckerman , health economist for the Health Policy Center at the Urban Institute, doubts either bill will make it past the Democratic-controlled Senate or gain the president’s signature. But he also doubts HITECH will gain any additional funds for excluded providers. That leaves one other possibility: that more providers find a way to qualify, but without the pot of funds increasing.

That scenario presents its own challenges. “If the goal is to give every provider who qualified in the original bill some fixed or minimum amount of funding, then adding new categories of providers without adding new dollars would not make sense,” said Zuckerman. “Unless new money is made available, and this seems unlikely, the only way to add new providers would be to reduce the funding available to each provider in the original group.”

The fate of excluded providers remains unclear, but so far all other attempts to include additional providers in the stimulus program have failed.

Some of the groups appear to be making small strides in at least getting their voices heard by having ONC assess their progress in adopting digital records. In March, the national coordinator’s office hired a new policy analyst — Liz Palena-Hall — to help providers who haven’t qualified for funds move forward in acquiring electronic health records. In its strategic plan published this March, the national coordinator’s office said it would look into “the creation of an incentive program to support the adoption of certified EHR technology within the behavioral health community.”

Some providers will no doubt also find a way to bypass the laws, making individuals or clinics apply for the funds as each qualifies. For instance, though rural health clinics do not qualify, their physicians do. With or without the impetus of government funds, experts agreed that the country’s health care system is eventually heading toward widespread use of electronic records.

“Some will be brought along because they are associated with another provider or it may just lower their costs,” said Neal Neuberger , executive director at the Institute for e-Health Policy. “Some of these technologies are beginning to take off because it makes good business sense.”