Hospitals Get EHR Incentives Now, but May Face Penalties Later


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Stimulus Incentives for EHR Adoption

The American Recovery and Reinvestment Act (ARRA) of 2009 will make $20 billion US available to hospitals that adopt government certified electronic health record (EHR) systems between 2010 and 2017. Under this act, an eligible 500-bed hospital can qualify for up to $6.1M US in Medicare incentives upon successful demonstration of “meaningful use” of federally certified EHR systems (see Table 1).

The formula for the Medicare incentive for hospitals is derived from the following:

  • A base incentive of $2M.
  • Inpatient Medicare volume.
  • Total annual discharges.
  • Charity care volume.
  • A transition factor.

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