Warning! Act Now to Avoid the E-Rx Penalty

All prescribers must be using E-Prescribing by June 30, 2011 to avoid a penalty in 2012 and 2013.  As part of the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), prescribing clinicians who fail to demonstrate the use of E-Prescribing at least 10 times by June 30, 2011 and 25 times by December 31 will be subjected to a 1% payment reduction for 2012 and a 1.5% cut for 2013 on all allowed Medicare charges.

In order to avoid Medicare payment cuts in 2012 and 2013 all prescribers must be using an E-Prescribing system that is able to:

  • Generate a complete active medication list incorporating electronic data received from applicable pharmacies and benefit managers (PBMs if available).
  • Generate a prescription and allow users to print the prescription or send it electronically.
  • Alert users regarding undesirable or unsafe situations including potentially inappropriate dose/route of a drug, drug-drug interactions, drug allergy warnings.
  • Provide information on lower-cost, therapeutically appropriate alternatives if there are any. (The availability of an E-Prescribing system to receive tiered formulary information electronically would meet this requirement.)
  • Provide information on formulary or tiered formulary medications, patient eligibility, and authorization requirements received electronically from the patient’s drug plan (if available).
  • Convey the above information using the messaging and interoperability standards currently in effect for the Medicare Part D E-Prescription program.

Unfortunately there are no certifications that ensure an E-Prescribing system meets the MIPPA requirements. As a result, you will need to ask your E-Prescribing vendor if they are compliant. If you are looking for an E-Prescribing system that meets these requirements a good place to begin is to check whether they have a Surescripts certification.

Prescribers must then submit claims with a G-code (G8553) at least 10 times by June 30, 2011 and 25 times by December 31, 2011.  This G-code is used when the prescription was created and transmitted using a qualified E-Prescribing system during a patient visit.

The G-code should be combined with a visit that includes one of the following service codes: 90801, 90802,90804, 90805, 90806, 90807, 90808, 90809, 90862,  92002, 92004, 92012, 92014, 96150, 96151, 96152, 99201, 99202, 99203, 99204, 99205, 99211, 99212, 99213, 99214, 99215, 99304, 99305, 99306, 99307, 99308, 99309, 99310, 99315, 99316, 99324, 99325, 99326, 99327, 99341, 99342, 99343, 99344, 99345, 99347, 99348, 99349, 99350, and G Codes: G0101, G0108, G0109. The measure has no diagnostic code or age/gender requirements in order to be included in the denominator.

Providers can obtain an exemption from the payment cuts if the following applies:

  • The eligible provider is not a physician (MD, DO, and podiatrist), nurse practitioner, or physician assistant as of June 30, 2011.
  • The eligible provider does not have at least 100 cases (that is, claims for patient services) that contain the applicable E-Prescribing service code (as defined above) for dates of service between January 1, 2011 through June 30, 2011.
  • The eligible provider is a successful electronic prescriber as defined by reporting a minimum of 10 successful E-Prescription events during the six-month period from January 1, 2011 to June 30, 2011.
  • The eligible provider (or group practice) claims reflect that less than 10% of their estimated total allowed charges for the January 1, 2011 through June 30, 2011 reporting period are comprised of applicable E-Prescription service codes.

In addition, an eligible provider (or group practice) can be considered for a “Significant Hardship Exemption” from the penalty if during January 1, 2011 through June 30, 2011, one of the following circumstances applies:

  • The eligible provider or group practice is located in a rural area with limited high speed Internet access. (G8642)
  • The eligible provider or group practice is located in an area with limited available pharmacies for electronic prescribing. (G8643)

An eligible provider or group practice must submit one of the related G codes indicated above during the first six months of 2011 to be considered for the hardship exemption.

Many of you may be in the process of selecting or implementing an EHR system that has integrated E-Prescribing, but may not be ready to do so by the June 2011 deadline. If this is the case, you may need to come up with an interim strategy to avoid the cuts. One option is to set up and use a free E-Prescribing system that will allow you to submit the required E-Prescriptions properly and on time.  Before taking this approach you should weigh the time it will take to you implement the E-Rx system and the potential impacts on patient care and workflow. In addition, measure the productivity implications, and the distraction to the adoption of your EHR against the costs of the E-Prescribing penalty. For most internists the penalty would equate to about $3,000 in 2012 and $4,500 in 2013.

For those of you who are already using an EHR system, you should make sure that the prescriptions you are entering within your system are actually being sent via Surescripts, rather than through a fax server. The use of a fax server instead of, or in addition to, a Surescripts interface is fairly common.  Even if you have a product that states that they have a Surescripts interface, you must make sure that your practice has implemented this capability, as it is frequently sold as an add-on feature with additional costs. In some cases, this may require updates to your EHR system to the appropriate version.

This post is the personal opinion of the author and does not necessarily reflect the official policy or position of the American College of Physicians (ACP). ACP does not endorse a specific EHR brand or product and ACP makes no representations, warranties, or assurances as to the accuracy or completeness of the information provided herein.


2 responses to "Warning! Act Now to Avoid the E-Rx Penalty"
  • June 1, 2011

    Do the G-codes have to be for medicare patients only, or are all payer classes a part of this?

    • June 1, 2011
      William S. Underwood MPH

      Great question Carol with all of the conflicting incentive programs this is always confusing. The e-Rx penalty is only for Medicare patients. So you will need to submit the g-codes for 10 Medicare patients by June 30th.

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