1. South Carolina Hospital Association HITECH Stimulus Calculator These worksheets have been forwarded to South Carolina hospital CFOs. They provide hospital- specific estimations of ARRA HITECH for your facility based on the latest CMS HCRIS data.

2. Federal Register Volume 75, Number 8 Wednesday, January 13, DEPARTMENT OF HEALTH AND HUMAN SERVICES Centers for Medicare & Medicaid Services 42 CFR Parts 412, 413, 422, and 495, Medicare and Medicaid Programs; Electronic Health Record Incentive Program Sec. 495.104 Incentive payments to eligible hospitals, Page 1997. http://www.gpo.gov/fdsys/pkg/FR-2010-01-13/html/E9-31217.htm South Carolina Hospital Association

3. Sec. 495.104 Incentive payments to eligible hospitals (Page 1997) (a)General rule. A qualifying hospital (as defined in this subpart) shall receive the special incentive payment as determined under the formulas described in paragraph (c) of this section for the period specified in paragraph (b) of this section. –A “qualifying hospital” is primarily determined by meeting Meaningful Use Criteria as defined beginning on page 1849 –The Meaningful Use definition is complicated and will be difficult to meet –This definition is being challenged by the American Hospital Association and most state associations –This report focuses only on the financial impact of the incentive payments once eligibility has been met. South Carolina Hospital Association

4. Sec. 495.104 Incentive payments to eligible hospitals (Page 1997) Hospitals paid under the Prospective Payment System Hospitals whose first payment year is FY 2011 may receive such payments for FYs 2011 through 2014 Hospitals whose first payment year is FY 2012 may receive such payments for FYs 2012 through 2015 Hospitals whose first payment year is FY 2013 may receive such payments for FYs 2013 through 2016 Hospitals whose first payment year is FY 2014 may receive such payments for FY 2014 through 2016 Hospitals whose first payment year is FY 2015 may receive such payments for FY 2015 through 2017. South Carolina Hospital Association

5. Sec. 495.104 Incentive payments to eligible hospitals (Page 1997) PPS Hospitals will receive a Medicare percentage and a Medicaid percentage of an initial amount equal to one of the following: For each hospital with 1,149 discharges or fewer during the fiscal year prior to the payment year, $2,000,000. For each hospital with at least 1,150 discharges during the payment year will receive the base incentive amount of $2,000,000 plus an additional $200 for every discharge between 1149 and 23,000 (21,851 discharges) South Carolina Hospital Association

6. PPS Examples: 1)For a hospital with 1,000 discharges the initial amount is only the base amount of $2,000,000 2)For a hospital with 10,000 discharges the initial amount is calculated as follows: $2,000,000 + ((10,000 – 1149) * $200)) = $3,770,200 3)For a hospital with 23,000 discharges the initial amount is calculated as follows: $2,000,000 + ((23,000 – 1149) * $200)) = $6,370,200 4)For a hospital with 25,000 (greater than 23,000) discharges the initial amount is calculated as follows: $2,000,000 + ((23,000 – 1149) * $200)) = $6,370,200 South Carolina Hospital Association

7. The Report Your hospital’s Chief Financial Officer has received an estimation of you hospital’s potential receipts based on historical CMS data These PowerPoints are samples for point reference only. Follow along on your actual copies. South Carolina Hospital Association

8. PPS Providers Medicaid The report for PPS hospitals includes 2 pages: Page 1, Medicare estimations Page 2, Medicaid and Consolidated estimations Combined total Medicare

9. Total Available Funds Hospitals do not automatically receive the entire base incentive payment. This section calculates the total base. Actual distributions are based on a Medicare and Medicaid Percentage of the overall facility total.

10. Medicare Your hospital-specific data was obtained from the latest HCRIS data available from CMS. The Cost Report period is noted above.

11. Medicare All variable historical data fields are highlighted and can be updated to allow you to enter more recent Cost Report data or to allow you enter estimations in order to review their impact.

12. Medicare The initial amount consists of a flat $2,000,000 for every facility. An additional $200.00 is also available for every discharge between 1,150 and 23,000 or a maximum amount of 21,851 discharges In this example: Qualified Discharges:23,000 – 1,149 = 21,851 Per Discharge Rate:21,851 x $200 = $4,370,000 The two amounts combined equal the total initial amount $2,000,000 + $4,370,000=$6,370,000 Only a portion of this amount is available to hospitals; a Medicare percentage and a Medicaid percentage.

13. The Medicare Percentage Total Medicare and Medicare Advantage Days as a percent of total hospital days Adjusted by a Medicare charity care ratio. As charity increases, the Medicare share also increases. Note: This is a variable field which will allow you to input your hospital’s charity dollars to adjust this estimation.

14. The Medicare Percentage Year 1 pays 100% of the Medicare maximum incentive payment Years 2-4 pay a declining percentage of the Medicare maximum incentive payment

15. The Medicaid Percentage The annual distribution has not yet been defined for the Medicaid portion, however the declining percentages apply to the total allowable amount. Therefore, the Medicaid percentage is applied to the total available over the 4 year period.

16. The Medicaid Percentage The Medicaid percentage is the hospitals traditional Medicaid days plus Medicaid managed care days as a percent of total hospital days. Adjusted by the same charity care ratio used in the Medicare percentage.

17. The Medicaid Percentage The 4 year total simply applies the Medicaid percentage to the total allowable amount.

18. The Medicaid Percentage Based on SCDHHS’ current intentions, this box distributes Medicaid funds on the same 4 year allocations as Medicare and produces a 4 year total Medicare and Medicaid reimbursement.

19. Sec. 495.106 Incentive payments to CAHs (Page 1997) Critical Access Hospitals CAHs are subject to the same eligiblity requirements as PPS hospitals (meaningful use criteria) A qualifying CAH receives an incentive payment amount equal to its reasonable costs incurred for the purchase of certified EHR technology times the Medicare share percentage plus an additional 20 percentage points, not to exceed 100% of costs. Total EHR Costs X (Medicare Share + 20% ) There is no additional payment component to CAHs for a Medicaid share South Carolina Hospital Association

20. Critical Access Hospitals The Critical Access Hospitals report consist of a Medicare Form Only As CAH payments are actual cost-based, no data is available for estimating these cost, This form completes the data fields available from HCRIS data and allows the user to input cost estimations.

21. Medicare The Medicare Percentage Total Medicare and Medicare Advantage Days as a percent of total hospital days Adjusted by a Medicare charity care ratio. An additional 20 percentage points (not to exceed 100%)

22. Medicare Each years actual costs times the Medicare Percentage Each years actual costs times the Medicare Percentage equals each years stimulus payment

23. South Carolina Hospital Association HITECH Stimulus Calculator Contact: Barney Osborne, VP of Finance and Reimbursement South Carolina Hospital Association 803.744.3544 bosborne@scha.org