The $4 billion in federal stimulus health care money headed to the Bay State over the next three years will help provide care for those who can’t afford it and it is hoped help stem hemorrhaging costs by funding new technologies.
The bulk of the health care stimulus funding – some $3.5 billion – will keep mostly safety-net programs afloat with Medicaid/Federal Medical Assistance Percentage funds.
But a portion of federal stimulus money is targeted for cost-saving innovation. Massachusetts is expected to receive $1.3 billion in technology and research funds, with more than $500 million slated for initiatives to help create electronic patient records in the commonwealth.
State officials hope the federal investment will lead to a secure statewide database of patient information.
Nationwide, some $19 billion will go to electronic records programs with a goal of freeing health workers from an paper-based system by 2014. President Barack Obama has touted the potential costs-savings from the program.
Stimulus funds will be used to reward those who have already installed the record system and provide money to hospitals and physicians who implement it. The state would also penalize those who fail to upgrade.
Physicians who meet the state criteria for electronic files could receive reimbursements of up to $44,000 each over four years directly from the federal government. There are about 20,000 physicians in the state, according to Health and Human Services.
Partners Healthcare could be a big winner in the stimulus sweepstakes because it has already implemented an electronic records system. With individual reimbursements for its 3,000 members, including teaching hospitals Brigham and Women’s and Massachusetts General Hospital, the health care consortium could receive $10 million to $50 million.
The state’s Health Care Quality and Cost Council estimates that it takes a small medical practice an average of four months to adopt an electronic system at an up-front cost of up to $40,000 per physician.
Up-front costs have been one of the biggest obstacles in creating an electronic system. But Massachusetts, which has nearly twice the national average of doctors using these systems, could face an easier transition with quicker federal reimbursements.
“The adaptation in Framingham was smoother because there wasn’t an existing paper record, so our advisors picked it up very quickly,” said Paula Kaminow, executive director of the Framingham Community Health Center, which began using electronic records when it opened five years ago.
Community health centers are important sources of medical information, Kaminow said, because they serve a wide population that doesn’t have personal physicians. Installation of electronic records in 12 centers could increase staff productivity, allow for expansion in the number of patients and ensure easier and faster sharing of patient information with hospitals.
“From a risk-management standpoint it’s much easier for providers to find the information they need,” Kaminow said. “The handwriting is clean, you can find different chart notes very quickly, and can integrate information from different sources.”
The electronic system could save the nation $530 billion over 10 years, according to the Health Care Quality and Cost Council, which estimates that the stimulus’ initiative could reduce the nation’s health care spending by up to 30 percent.
Kaminow said the most important characteristic for an electronic record is the ability to interface with other types of records.
“The challenge is to make sure that all the different pieces can speak to each other, such as a management system that can speak to an electronic health record, or a lab report,” she said.
The central project for the state is the Health Information Exchange, which is not funded by federal dollars. The state’s newly-established Health Information Technology Council will provide $15 million in initial funding to help install the exchange by 2014.
The exchange would combine electronic record projects for individual practices, hospitals, and community health centers, sharing patient information in a secure statewide database. Anyone in the system treating a patient could quickly learn about the patient’s allergy data, medication and test results.
The initiative has another reward: Job creation.
Private-sector jobs could grow among vendors installing database systems, with positions ranging from entry-level programmers to high-level project managers.
Massachusetts has a leg up in this respect with an already developed system of software and hardware vendors.
“We’re looking to bring on more staff and extend our hours,” said Kaminow. “After a start-up period, our costs are covered through billing, so in that way we’d be able to sustain increased employment.”
The other big slice of the health care stimulus package is the $764 million coming to Massachusetts for over the next two years.
Funds will be used primarily to maintain services-securing jobs, meeting health care standards and safety net services, with $190 million going to offset fiscal 2009 budget holes, according to Health and Human Services.
Stimulus money provide a nationwide increase in federal matching dollars to Medicaid/Federal Medical Assistance Percentage funds of 6 percent, with potential increases depending on the state’s unemployment rate during the stimulus period.
Massachusetts receives an increase from 50 percent in federal matching dollars to 56.2 percent. Given the state’s shaky unemployment rate, which rose to 7.4 percent in March – a full point since December – the commonwealth could see an increase as high as 11.6 percent in the medical assistance dollars.
In fiscal 2010, $255 million would go to securing jobs and health care services provided by the state. The breakdown for this portion of funds is as follows:
- $160 million for hospitals
- $10 million to community health centers
- $45 million to nursing homes
- $15 million to community mental health $20 million to the “Community First” initiative, which transitions those with mental and intellectual disabilities from institutional care to community-based care $5 million to other health care providers $222 million toward maintaining coverage and eligibility for members of the state’s MassHealth and Commonwealth care health insurance programs.
- Finally, $97 million would help protect safety-net services by maintaining or restoring portions of funds to the Departments of Mental Health, Developmental Services, Commissions and Veterans, Children and Families, Youth Services, Public Health and MassHealth.
