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Business Costs & Regulation

Preventive Care, Electronic Medical Records Guidelines Set

The government's busy filling in the blanks on what employers, health providers and insurers need to do with health care reform.

New health plans beginning on or after Sept. 23 will have to provide free preventive care. Grandfathered plans are exempt from the requirements, which were ordered in the Patient Protection and Affordable Care Act.

Required services include routine vaccinations, screening for breast and colon cancer, high cholesterol, high blood pressure and diabetes, prenatal care and regular wellness visits for infants and children, as well as counseling to help smokers kick the habit. Additional preventive services for women will be outlined later this year. Patients must get their preventive care from in-network providers to avoid copays.

The goal is to improve health and reduce health care costs, although the Department of Health and Human Services (HHS) estimates that, at least in the short run, adding the free services will boost premiums by 1.5%. Chronic diseases such as heart disease, diabetes and cancer are responsible for seven of 10 deaths among Americans each year and account for 75% of the nation’s health spending. These diseases are often preventable, though according to HHS, Americans use preventive services at only half the recommended rate. If they don’t have to pay for them, they are more likely to use the services.

Other regulations make it easier for health providers to win federal IT grants. An HHS rule cuts the number of requirements that doctors and hospitals must meet to be eligible for some of the $27 billion in incentives to transition from paper to electronic medical records. The criteria list was cut by a third after providers objected. Hospitals now will have to meet 14 core “meaningful use” requirements, while doctors will have to meet 15. Providers also will have to choose an additional five criteria from a list of 10 to qualify. Some of the criteria include using an electronic system to prescribe medications, maintaining a list of patient medications that includes any allergic reactions, recording patients’ smoking status and providing them with copies of their digital records.


Doctors and hospitals criticized the earlier proposed rule for requiring unrealistic goals, and agree the final rule is much more workable. But hospital groups say the hurdles are still too high for small hospitals. They’re also concerned hospitals with multiple sites may be eligible for only one payment. They are likely to appeal to Congress to order a rule change more to their liking.

The payments may begin as early as 2011. Funds for doctors max out at $107,750 ($44,000 through Medicare and $63,750 through Medicaid). Hospitals may be eligible for millions. By 2015, providers will be penalized if they have not gone digital.

Tougher rules on patient privacy are in the works. The federal government will require third-party business associates to observe the same security rules that apply to providers and employers. That will affect plan administrators, pharmacy benefit managers, claims processing and billing firms, and those who perform legal, actuarial, accounting and other services that give them access to protected patient information.

Individuals’ right to access their information will be expanded, as well as their right to restrict certain disclosures. The rule includes limits on the use and disclosure of health info for marketing and fundraising. Also, there’s a prohibition on the sale of protected information without patient authorization.

The rule will implement the Health Information Technology for Economic and Clinical Health (HITECH) Act, which Congress passed in 2009. As the use of health care IT is expanded, the idea is to assure patients and providers that the information is protected and secure.