[House Hearing, 111 Congress] [From the U.S. Government Publishing Office] IMPLEMENTATION OF THE HEALTH INFORMATION TECHNOLOGY FOR ECONOMIC AND CLINICAL HEALTH (HITECH) ACT ======================================================================= HEARING BEFORE THE SUBCOMMITTEE ON HEALTH OF THE COMMITTEE ON ENERGY AND COMMERCE HOUSE OF REPRESENTATIVES ONE HUNDRED ELEVENTH CONGRESS SECOND SESSION __________ JULY 27, 2010 __________ Serial No. 111-149 Printed for the use of the Committee on Energy and Commerce energycommerce.house.gov U.S. GOVERNMENT PRINTING OFFICE 78-126 WASHINGTON : 2010 ----------------------------------------------------------------------- For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, Washington, DC 20402-0001 COMMITTEE ON ENERGY AND COMMERCE HENRY A. WAXMAN, California, Chairman JOHN D. DINGELL, Michigan JOE BARTON, Texas Chairman Emeritus Ranking Member EDWARD J. MARKEY, Massachusetts RALPH M. HALL, Texas RICK BOUCHER, Virginia FRED UPTON, Michigan FRANK PALLONE, Jr., New Jersey CLIFF STEARNS, Florida BART GORDON, Tennessee NATHAN DEAL, Georgia BOBBY L. RUSH, Illinois ED WHITFIELD, Kentucky ANNA G. ESHOO, California JOHN SHIMKUS, Illinois BART STUPAK, Michigan JOHN B. SHADEGG, Arizona ELIOT L. ENGEL, New York ROY BLUNT, Missouri GENE GREEN, Texas STEVE BUYER, Indiana DIANA DeGETTE, Colorado GEORGE RADANOVICH, California Vice Chairman JOSEPH R. PITTS, Pennsylvania LOIS CAPPS, California MARY BONO MACK, California MICHAEL F. DOYLE, Pennsylvania GREG WALDEN, Oregon JANE HARMAN, California LEE TERRY, Nebraska TOM ALLEN, Maine MIKE ROGERS, Michigan JANICE D. SCHAKOWSKY, Illinois SUE WILKINS MYRICK, North Carolina CHARLES A. GONZALEZ, Texas JOHN SULLIVAN, Oklahoma JAY INSLEE, Washington TIM MURPHY, Pennsylvania TAMMY BALDWIN, Wisconsin MICHAEL C. BURGESS, Texas MIKE ROSS, Arkansas MARSHA BLACKBURN, Tennessee ANTHONY D. WEINER, New York PHIL GINGREY, Georgia JIM MATHESON, Utah STEVE SCALISE, Louisiana G.K. BUTTERFIELD, North Carolina CHARLIE MELANCON, Louisiana JOHN BARROW, Georgia BARON P. HILL, Indiana DORIS O. MATSUI, California DONNA M. CHRISTENSEN, Virgin Islands KATHY CASTOR, Florida JOHN P. SARBANES, Maryland CHRISTOPHER S. MURPHY, Connecticut ZACHARY T. SPACE, Ohio JERRY McNERNEY, California BETTY SUTTON, Ohio BRUCE L. BRALEY, Iowa PETER WELCH, Vermont Subcommittee on Health FRANK PALLONE, Jr., New Jersey, Chairman JOHN D. DINGELL, Michigan NATHAN DEAL, Georgia, BART GORDON, Tennessee Ranking Member ANNA G. ESHOO, California RALPH M. HALL, Texas ELIOT L. ENGEL, New York BARBARA CUBIN, Wyoming GENE GREEN, Texas JOHN B. SHADEGG, Arizona DIANA DeGETTE, Colorado STEVE BUYER, Indiana LOIS CAPPS, California JOSEPH R. PITTS, Pennsylvania JANICE D. SCHAKOWSKY, Illinois MARY BONO MACK, California TAMMY BALDWIN, Wisconsin MIKE FERGUSON, New Jersey MIKE ROSS, Arkansas MIKE ROGERS, Michigan ANTHONY D. WEINER, New York SUE WILKINS MYRICK, North Carolina JIM MATHESON, Utah JOHN SULLIVAN, Oklahoma JANE HARMAN, California TIM MURPHY, Pennsylvania CHARLES A. GONZALEZ, Texas MICHAEL C. BURGESS, Texas JOHN BARROW, Georgia DONNA M. CHRISTENSEN, Virgin Islands KATHY CASTOR, Florida JOHN P. SARBANES, Maryland CHRISTOPHER S. MURPHY, Connecticut ZACHARY T. SPACE, Ohio BETTY SUTTON, Ohio BRUCE L. BRALEY, Iowa C O N T E N T S ---------- Page Hon. Frank Pallone, Jr., a Representative in Congress from the State of New Jersey, opening statement......................... 1 Prepared statement........................................... 4 Hon. John Shimkus, a Representative in Congress from the State of Illinois, opening statement.................................... 8 Hon. Lois Capps, a Representative in Congress from the State of California, opening statement.................................. 9 Hon. Phil Gingrey, a Representative in Congress from the State of Georgia, opening statement..................................... 10 Hon. Janice D. Schakowsky, a Representative in Congress from the State of Illinois, opening statement........................... 11 Hon. Joseph R. Pitts, a Representative in Congress from the Commonwealth of Pennsylvania, opening statement................ 12 Hon. Anna G. Eshoo, a Representative in Congress from the State of California, opening statement............................... 13 Hon. Joe Barton, a Representative in Congress from the State of Texas, opening statement....................................... 14 Prepared statement........................................... 16 Hon. Donna M. Christensen, a Representative in Congress from the Virgin Islands, opening statement.............................. 22 Hon. Michael C. Burgess, a Representative in Congress from the State of Texas, opening statement.............................. 22 Hon. John P. Sarbanes, a Representative in Congress from the State of Maryland, opening statement........................... 23 Hon. Marsha Blackburn, a Representative in Congress from the State of Tennessee, opening statement.......................... 24 Hon. John D. Dingell, a Representative in Congress from the State of Michigan, opening statement................................. 25 Hon. Kathy Castor, a Representative in Congress from the State of Florida, opening statement..................................... 26 Hon. Gene Green, a Representative in Congress from the State of Texas, opening statement....................................... 27 Hon. Tim Murphy, a Representative in Congress from the Commonwealth of Pennsylvania, opening statement................ 28 Hon. Zachary T. Space, a Representative in Congress from the State of Ohio, opening statement............................... 29 Hon. John Barrow, a Representative in Congress from the State of Georgia, opening statement..................................... 30 Hon. Jane Harman, a Representative in Congress from the State of California, opening statement.................................. 31 Hon. Henry A. Waxman, a Representative in Congress from the State of California, prepared statement.............................. 155 Witnesses David Blumenthal, M.D., National Coordinator, Health Information Technology, U.S. Department of Health and Human Services....... 32 Prepared statement........................................... 35 Answers to submitted questions............................... 165 Anthony Trenkle, Director, Office of E-Health Standard and Services, Centers for Medicare and Medicaid.................... 48 Prepared statement........................................... 51 Answers to submitted questions............................... 167 Frank J. Vozos, M.D., FACS, Executive Director, Monmouth Medical Center, on Behalf of New Jersey Hospital Association........... 82 Prepared statement........................................... 86 Gregory D. Starnes, CEO, Fayette County Hospital................. 93 Prepared statement........................................... 96 Christine Bechtel, Vice President, National Partnership for Women and Families................................................... 100 Prepared statement........................................... 102 Roland A. Goertz, M.D., M.B.A., President-Elect, American Academy of Family Physicians, CEO and Executive Director, Heart of Texas Community Health Center.................................. 107 Prepared statement........................................... 109 Matthew Winkleman, M.D., Physician, Primary Care Group, Harrisburg, Illinois........................................... 116 Prepared statement........................................... 118 Glen E. Tullman, Chief Executive Officer, Allscripts............. 121 Prepared statement........................................... 124 Peggy C. Evans, Ph.D., CPHIT, Director, Washington and Idaho Regional Extension Center, Qualis Health....................... 128 Prepared statement........................................... 131 Submitted material Statement of The Academy Advisors, submitted by Mr. Shimkus...... 160 Statement of The Premier healthcare alliance, submitted by Mr. Shimkus........................................................ 162 IMPLEMENTATION OF THE HEALTH INFORMATION TECHNOLOGY FOR ECONOMIC AND CLINICAL HEALTH (HITECH) ACT ---------- TUESDAY, JULY 27, 2010 House of Representatives, Subcommittee on Health, Committee on Energy and Commerce, Washington, DC. The subcommittee met, pursuant to call, at 1:05 p.m., in Room 2322 of the Rayburn House Office Building, Hon. Frank Pallone, Jr. [Chairman of the Subcommittee] presiding. Members present: Representatives Pallone, Dingell, Eshoo, Green, Capps, Schakowsky, Harman, Gonzalez, Barrow, Christensen, Castor, Sarbanes, Murphy of Connecticut, Space, Waxman (ex officio), Shimkus, Pitts, Murphy of Pennsylvania, Burgess, Blackburn, Gingrey and Barton. Staff present: Ruth Katz, Chief Public Health Counsel; Purvee Kempf, Counsel; Katie Campbell, Professional Staff Member; Emily Gibbons, Professional Staff Member; Tim Gronniger, Professional Staff Member; Virgil Miler, Professional Staff Member; Alvin Banks, Special Assistant; Ryan Long, Minority Counsel; Clay Alspach, Minority Counsel; Sean Hayes, Minority Counsel; Brandon Clark, Minority Professional Staff; and Garrett Golding, Minority Legislative Analyst. OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW JERSEY Mr. Pallone. I call the meeting of the Health Subcommittee to order. Today we are having a hearing on implementation of the Health Information Technology for Economic and Clinical Health Act of 2000, or the HITECH Act. Now, I should mention, and Mr. Shimkus reminded me, that this is actually in the Recovery Act, so we are actually talking about the implementation of the HIT part, if you will, of the Recovery Act. And I will recognize myself initially for an opening statement. The HITECH Act contained unprecedented funding to promote the adoption of health information technology among hospitals, doctors and health care providers through initiatives by the Office of the National Coordinator of HHS and through Medicare and Medicaid incentives. This historic investment will serve to modernize our Nation's use of technology to truly ensure a high-performing 21st century system. The Energy and Commerce Committee has worked on a bipartisan, collaborative basis for many years on health information technology. This hearing will examine the progress made so far and opportunities that will be realized in the future through the implementation of the HITECH Act. While the United States is a leader in medical technology and innovation, we have a curiously antiquated system today related to health IT. Only 20 percent of doctors and only 10 percent of hospitals use even basic electronic health records, making coordination between health care providers challenging and leaving the burden on patients to ensure that each provider knows what tests have been done and what medications have been prescribed. Too often, this information falls through the cracks, resulting in wasteful, duplicative tests and preventing providers from having the full snapshot of a patient's medical profile. The successful adoption of health information technology will have a transformative effective on the quality of health care in the United States. The provisions of the HITECH will ensure that Americans nationwide have access to a truly patient-centered health care system with better quality, more affordable health care delivered in an efficient and coordinated manner. It also will promote the advanced use of electronic health records to facilitate the ordering of tests and medication, aid in clinical decision-making and allow for secure data-sharing and privacy protection among providers, insurers and patients. Now, it is timely that we have this hearing today, in my opinion, since CMS just announced on July 13th the final rule for the minimum requirements that eligible Medicare and Medicaid providers must meet through their use of a certified electronic health record technology to quality for the incentive payments included in the HITECH Act. This rule was dually released with companion final regulations on the standards and certification criteria needed for EHR technology to be successfully used by eligible professionals and hospitals. There are over 2,000 health care providers, patients and other stakeholders who weighed in on the proposed rule when it was released in January. Many changes were incorporated into the final rule, which preserved the goals of the HITECH Act while also making the requirements attainable. I look forward to hearing an update on these rules from our witnesses today as well as on other aspects of the HITECH Act. I will note we have two great panels of government and private witnesses here with us today. I am particularly pleased that Dr. Frank Vozos, the Executive Director of my hometown hospital, Monmouth Medical Center, can be with us today. I had the opportunity to tour Monmouth Medical Center, which is a community teaching hospital, over the, I guess it was the July 4th recess or work period, and I was very pleased to see the work they are doing already to implement HIT adoption and to learn how they plan to use HITECH funds and guidelines to further advance their medical care, so I want to thank Frank Vozos, another Frank, for being with us here today. I have mentioned in the past sort of a personal story with regard to the HIT issue. My mom passed away from pancreatic cancer about 18 months ago now, and for the 7 months or so from when she was diagnosed until she finally passed, we went to various institutions including Monmouth Medical and Johns Hopkins, and it would also drive me crazy because we would have, I guess it was the CAT scan put on a disc--Robert Wood was another one that we visited--and at each place I would try to carry the CAT scan with me and say OK, here it is on a disc, you know, these are the tests she had, and without reference to any particular institution, I always had to have it redone, because they couldn't use, either there was no interoperability or whatever. And it drove me crazy but it just seemed to make no sense, and of course, I was worried because she was in a bad situation, that this wasn't a good thing for her to have to be restested all the time. So that is just my own personal experience that hopefully that type of thing we can guard against in the future. [The prepared statement of Mr. Pallone follows:] [GRAPHIC] [TIFF OMITTED] 78126A.001 [GRAPHIC] [TIFF OMITTED] 78126A.002 [GRAPHIC] [TIFF OMITTED] 78126A.003 [GRAPHIC] [TIFF OMITTED] 78126A.004 Mr. Pallone. With that, I will ask Mr. Shimkus to give us an opening statement. OPENING STATEMENT OF HON. JOHN SHIMKUS, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS Mr. Shimkus. Thank you, Mr. Chairman, for holding this hearing to update us on the progress of implementing the HITECH Act. This issue has shared bipartisan support as we seek to modernize and create efficiencies in our health care delivery system. Despite the enthusiasm and promises of HIT, concerns have been voiced from the provider community as we move forward. Some issues have already been addressed such as loosening the number of requirements in the first year to comply with meaningful use and allowing critical-access hospitals eligibility for certain payments under Medicaid. However, other roadblocks remain and we must ensure providers across the country are able to meet the requirements in the timeline set out. The hearing today is a chance for us to review where we stand and ask ourselves if we are trying to make providers run before they can walk when it comes to HIT. I particularly want to thank a few of our witnesses for being here today from my district back in Illinois. First, Mr. Gregory Starnes is here from Fayette County Hospital, which is a critical-access hospital. Mr. Starnes lends a voice to rural hospitals and the unique challenges they face in trying to implement their systems without the budget and attention of some larger urban hospitals. I also want to thank Dr. Matt Winkleman from Harrisburg, Illinois, for making the trip here today, and of course everyone knows Harrisburg, Illinois--and that is supposed to be a joke. My staffer is fired. That is a good joke. It is all in the delivery, he says. I look forward to hearing from Dr. Winkleman on his practice was able to rise to the challenge of implementing HIT while working off the small margins that come from serving a rural working-class community. Despite the promising future the HITECH Act holds, it is difficult to look past the failures of the so-called stimulus bill it was part of. The American people paid the tab on what they were told would create jobs, keeping unemployment at below 8 percent and to stimulate the economy. The country has lost over 3 million jobs since the stimulus passed and unemployment hovers at 9.5 percent, even higher in my district in Illinois, all this at a cost of $1.2 trillion to the American taxpayer, an enormous failed policy continued with the health reform law. We have been in session 15 weeks since the health care bill was signed into law by the President in March, 15 weeks and 15 hearings on health, not on the law. In what is likely our last hearing before recess, the majority has never responded to numerous requests to hold hearings on implementation of the new law. On several occasions we have asked for the Administration to come before the committee, to no avail. Yet with ease we were able to have representatives of both HHS and CMS to discuss the HITECH Act today, and we appreciate them coming. It has been over four months and the majority won't even acknowledge problems exist with the new law and they aren't going away. According to CBO, premiums in the individual market are going to increase 10 to 13 percent as a direct result of this law. Nearly all small businesses will see no relief from the tax credit in the law. Many small businesses will opt to pay fines rather than buy health insurance because they can't afford the cost. Instead, they will raise prices to customers and stop hiring new employees. High-risk pools that were supposed to provide immediate coverage uninsurable are going to have to have waiting lines and use preexisting conditions to limit those who enter the new pools. We were told the President's Executive Order would prevent federal dollars from being spent on abortion services yet we already know in Pennsylvania and New Mexico, millions of new federal dollars will go toward coverage of abortion services through their high-risk pools. The President promised the pro-life community and pro-life Democrats in the House his executive order would prevent this from happening. Will the President now make good on the promise or is this evidence of what many of us feared all along, that the health reform law lacks critical protections to prevent taxpayer-subsidized abortions. Millions of Americans will be forced into a Medicaid program that is going broke. At the same time, half of all seniors with Medicare Advantage will lose their coverage. Those lucky enough to keep them will see increases in cost while losing dental coverage and other benefits they rely on. For those in traditional Medicaid, the billions of dollars in cuts are unsustainable and will cause problems and reduce quality of care for seniors. Leading the charge will be Dr. Donald Berwick, CMS Administrator without any Congressional approval, and we need to talk to the new CMS Administrator. He is a big supporter of the British health system which has just reported that it has failed and they were moving to a decentralized process in system. The list continues to go on. We have a responsibility to hold hearings on the implementation of the new health care law just as we are doing here today when it comes to the HITECH Act. Madam Chairman, with the law that will touch every American life, I hope we will at least have an explanation for the majority to the American people on why this request is being ignored, and I yield back the balance of my time. Mrs. Capps [presiding]. The Chair recognizes herself for an opening statement. OPENING STATEMENT OF HON. LOIS CAPPS, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA Mrs. Capps. I am so pleased that today we are exploring the beginning stages of the HITECH Act and our Nation's considered effort to move toward a more efficient and effective system of health care. Like many of my colleagues, I was here for some of the earliest conversations we had in this committee about HIT and I am really proud of what we have accomplished. This includes Chairman Dingell's bill last Congress, the Protecting Records, Optimizing Treatment and Easing Communications through Health Care Technology Act of 2008, and that bill is actually the one that laid the groundwork for many pieces of the HITECH Act. I hope that today we will be able to explore the implementation of the HITECH Act to date including both the successes as well as the challenges that have been encountered, but I also hope to discuss the future implementation steps of this bill as our Nation's health care system moves from paper- based recordkeeping to a dynamic electronic system. The promise of health information technology for both patients and providers is, I believe, remarkable, and as the public understands how it is so beneficial, it is going to make a difference in the way we accept the changes in health care that will come about as we see that they are very cost-effective. I am a nurse by background and I am also a mother and a grandmother, and I know firsthand the logistical challenge that paper-based systems pose. That is one I have been familiar with as a nurse most of my professional life. Every parent knows how you struggle to find the proper records of their child's vaccinations when they start back to school in the fall. Medical specialists unsure of a senior's medical regimen from their primary care provider, the senior maybe can't remember all of the things that have happened since. Moving to a new town, trying to fill out one's medical history at the doctor for the very first time, or even when you go back and you are asked to re-fill the form and you can't remember all the things that have happened. Electronic health records can follow the patient and can flag potential issues while at the same time enhancing the medical provider's practice by reducing inefficiencies in recordkeeping and frustration in collecting an accurate medical history. And while HIT is not a silver bullet to all of our health care problems, it is a key step in modernizing our health system. So I look forward to the testimony of our witnesses and I yield back. At this time I will recognize Mr. Gingrey for an opening statement. OPENING STATEMENT OF HON. PHIL GINGREY, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF GEORGIA Mr. Gingrey. Madam Chair, thank you so much. Health information technology has the potential to improve the quality and reduce the cost of health care in this country. In fact, according to the Rand Corporation, the potential savings for both inpatient and outpatient care could average $77 billion annually if most hospitals and doctors actually adopted HIT, health information technology. The study found that the largest savings would come from reduced hospital stays and administrative time as well as more-efficient drug utilization and not having doctors order the same test two weeks apart, expensive scanning and that sort of thing. Therefore, Madam Chair, I am interested to hear the witnesses, Mr. Blumenthal's and Mr. Trenkle's thoughts on how providers will achieve the broader information exchange requirements specified under stage 2 in light of the relaxed requirements that the final rule has under stage 1. In addition, I look forward to hearing from our second panel of witnesses and their thoughts on how we move forward. Madam Chair, if there were silver bullet solutions for our health care system, information technology would surely be one of them, maybe the main one. This technology has the potential to improve the quality and the efficiency of our health care system while ensuring that tax dollars are spent wisely. With it, we can better identify and we can cut waste, fraud and abuse out of the system. Once implemented, we will be better able to protect patients' privacy and eliminate the inefficiency of a system based on paper charts. I know of what I speak. I practiced medicine for 31 years. Therefore, a series of targeted bills based on silver bullets, medical liability reform, increased transparency, electronic medical records, health insurance reform for sick and low-income Americans could have passed in a transparent and bipartisan manner. Instead, what did we do? We passed a 2,400 page omnibus bill that few members could read and understand. Madam Chair, I have repeatedly used my opening statement in this committee over the past few months to support my ranking member, John Shimkus's call for a hearing on Obamacare, Patient Protection and Affordable Care Act of 2010. Why? Well, because on March 9th, Speaker Pelosi said that the bill is, and I am going to quote her now, ``going to be very, very exciting but we have to pass the bill so you can find out what is in it away from the fog of controversy.'' Now, that is a direct quote. Speaker Pelosi was successful and this Democratic majority did pass Obamacare, but the fog of controversy still exists in spite of her promise. It turns out that a large majority of workers won't be able to keep the health care they like today and they may even lose their jobs because of the law. The cost projections for patients, employers and our government continue to rise. Health insurance will not be available or affordable to hundreds of thousands of sick Americans. These problems all represent broken promises made by the President to the American people. Where the President's rhetoric has not lived up to his product, Congress indeed needs to investigate. The American people deserve to know what is in this law, and I fear that unless we hold hearings immediately to investigate the new law, our constituents will find out the hard way. Madam Speaker, I have gone a little bit over. Thank you for your patience. I would like to submit three things for the record as I yield back. One is a statement in regard to electronic medical records by the American Medical Association, another by the United Health Group, and finally, by Electronic Health Records Association. Mrs. Capps. Without objection, so ordered. [The information was unavailable at the time of printing.] Mr. Gingrey. And I yield back. Thank you so much, Madam Speaker. Mrs. Capps. The Chair now recognizes Ms. Schakowsky for 5 minutes--for 3 minutes. OPENING STATEMENT OF HON. JANICE D. SCHAKOWSKY, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS Ms. Schakowsky. Thank you, Madam Speaker. I just want to respond briefly to the ranking member, who rather than addressing the potential for reducing costs and improving care of health IT decided as usual to restate the talking points of the insurance industry including saying that this historic and important piece of legislation is the cause of higher costs. Instead, what we have seen is excessive premium increases--see Well Point--and higher profits--see United Health Care, who at the same time as their profits went up the amount of health care they actually provide for each dollar has gone down. And a part of this bill is talking about the advantages that we can reap from taking advantage of health IT, which is vital for this country. The development of a nationwide interoperable health information technology system is a critical component of improving health care quality, promoting care coordination and reducing medical errors. I have been in the record rooms of clinics and hospitals, rooms overflowing with files taking up space that could be put to significantly better use. These clinics need health IT, and the $2 billion provided in the American Recovery and Reinvestment Act will go a long way to upgrade and improve this Nation's health care system. As someone who recognizes the substantial rewards of moving our health care system toward health IT functions, I also know that we must ensure complete security and privacy for consumers. Through the chairman's leadership, the HITECH Act strengthened federal privacy and security laws to protect personal identifying information from misuse. Without critical privacy and security guarantees, consumers will simply not be willing to utilize electronic records. As we move forward with greater utilization of electronic records, this is an area where we have to remain diligent. I would also like to thank the witnesses today for their testimony, in particular, those from the Administration. Congress tasked HHS with a large job when we passed the HITECH Act, and they have worked quickly to implement this program. They have also been responsive, addressing concerns with implementation. I was one of several members that urged HHS to reevaluate their first consideration of meaningful use, and they have subsequently taken many of those concerns into account during rulemaking. I look forward to working in the months and years ahead as we implement the full promise of health IT. So I thank you, Madam Chairman, and I yield back the balance of my time. Mrs. Capps. The Chair now recognizes Mr. Pitts for his opening statement. OPENING STATEMENT OF HON. JOSEPH R. PITTS, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA Mr. Pitts. Thank you, Madam Chairman. On February 17, 2009, the President signed the American Recovery and Reinvestment Act, also known as the stimulus bill, into law, promising that the $787 billion bill would create or save 3\1/2\ million jobs over the next 2 years. We were also told that the stimulus would hold unemployment under 8 percent. At this point in the recovery, unemployment would be at 7.5 percent. No one, not the White House, not Congressional leadership, can tell us with any degree of accuracy how many jobs have been saved or created. In fact, it is impossible to calculate how many jobs were not lost due to the passage of the stimulus or any other bill, for that matter. As for jobs created, we have an ever-expanding federal workforce, not a thriving private sector, and as we all know, unemployment is currently at 9.5 percent after peaking at 9.9 percent earlier this year. One of the provisions included in the stimulus was the Health Information Technology for Economic and Clinical Health, or HITECH Act. While I would question how the HITECH Act is stimulative or how many jobs it has saved or created, we all see the promise of health information technology from reduced errors, greater efficiencies to being able to share information across the country with the click of a mouse, and I support the goals of the HITECH Act. Many of us have been contacted, however, by providers from back home who panicked when the proposed rule came out earlier this year, and it seemed that few hospitals and doctors' offices could meet such an aggressive implementation timetable or stringent criteria. I hope that our Administration witnesses will discuss how the final rule has been changed to address some of these concerns, and I look forward to hearing from our witnesses. Thank you, Madam Chairman. I yield back. Mrs. Capps. The Chair now recognizes Ms. Eshoo for her opening statement. OPENING STATEMENT OF HON. ANNA G. ESHOO, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA Ms. Eshoo. Thank you, Madam Chairwoman. It is nice to see you in the chair, and thank you for holding this important hearing on the implementation of the HITECH Act. The legislation we included in the American Recovery and Reinvestment Act to promote health information technology was adopted to revolutionize the health care delivery system in our country. I have been so often struck by this: we live in the Information Age and yet our health care system has really been mired in the pen-and-paper past, and so the money that is directed toward a comprehensive, interoperable and nationwide HIT system is one that really meets what the 21st century is all about, and I don't think that there is a doubt that this will have a salutary outcome in terms of enhancing patient safety, reducing medical errors, improving the overall quality of care, and of course, having a system that protects the privacy of patients as well. I have been concerned for a long time about this issue. I introduced comprehensive legislation, HIT legislation, in 2007. We spent months meeting with doctors, with hospitals, with technology companies, which I think everyone knows, many of them make their home in my Congressional district, as well as HIT vendors, and I am proud to say that the work that my staff and myself did on that legislation really became the basis of the legislation that Mr. Dingell introduced and now we are going to be reviewing it. So I am really pleased that Dr. Blumenthal, the National Coordinator for HIT, and Anthony Trenkle from the Office of E- Health at CMS are going to share with us their experiences in implementing the legislation. I know that there are bumps in the road. There always are. When constituents ask me about legislation, I always say well, understand that legislation is shaped by human beings and that legislation bears the mark of humanity. It is less than perfect. But what is exciting to me is that we have launched the effort. We have placed significant resources next to it, $2 billion, and so today is a good chance to hear about how we are doing on this very important journey. So I look forward to hearing from our friends that are here to be witnesses and also to the second panel that will instruct us as well. So I thank the chairwoman, I thank the chairman of the subcommittee for scheduling this and I thank the witnesses and look forward to hearing from you. Mrs. Capps. I thank my colleague. Now we turn to the ranking member of the full committee, Mr. Barton, for his opening statement. OPENING STATEMENT OF HON. JOE BARTON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS Mr. Barton. Thank you, Madam Chairwoman. I thank you and Ranking Member Shimkus and Subcommittee Chairman Mr. Pallone for holding this hearing. We thank our witnesses on this panel, and I know we have several on the second panel. We thank them for participating, especially the witness from the Heart of Texas Community Health Center down in Texas. We are glad that he is here. Obviously the Republicans are not against health information technology. Last year we worked on a bipartisan basis to pass a bipartisan health IT bill. Unfortunately, that bill did not become law. Instead, at the start of this Congress, our friends in the majority passed their version of health IT as part of the so-called stimulus bill. I would like to hear from the witnesses later this afternoon just how stimulative that has been. The unemployment rate is about 9\1/ 2\ percent around the country. This bill that we are looking at today didn't do much in the private sector. It focused more on spending federal dollars while ignoring the less-expensive avenues for health IT deployment. I think it would have been better to allow hospitals and physicians to donate health IT systems to each other, for example. It has been over a year since this bill became law, the stimulus bill, that is. That package is going to cost about $1\1/2\ trillion. Numbers that I have been given indicate that according to the Bureau of Labor Statistics, we have lost over 3 million jobs in that time, so I think it is a fair question: where are these jobs and how has this particular bill helped create jobs. While it is not the focus of the hearing, last week myself and several other Republicans asked for a hearing on the recess appointment of Dr. Berwick to head the new CMS. Dr. Berwick was appointed without being approved by the Senate, which I think is a bad precedent, although not unprecedented. Obviously other Presidents have done recess appointments. As we try to implement the new health care law, the bigger law, I think people have a right to know how Dr. Berwick plans to implement that law and make all those cuts in Medicare in the neighborhood of $145 billion. So in any event, Madam Chairman, again, we are not opposed to health IT, we are not opposed to the federal government being involved, but we didn't have much say in this particular bill, so it is going to be an interesting dialog as we go forward. With that, I will put the rest of my statement in the record. And again, we do thank our witnesses and we look forward to their testimony. Thank you. [The prepared statement of Mr. Barton follows:] [GRAPHIC] [TIFF OMITTED] 78126A.005 [GRAPHIC] [TIFF OMITTED] 78126A.006 [GRAPHIC] [TIFF OMITTED] 78126A.007 [GRAPHIC] [TIFF OMITTED] 78126A.008 [GRAPHIC] [TIFF OMITTED] 78126A.009 [GRAPHIC] [TIFF OMITTED] 78126A.010 Mrs. Capps. Thank you, Mr. Barton. And now we turn to Mrs. Christensen for her opening statement. OPENING STATEMENT OF HON. DONNA M. CHRISTENSEN, A REPRESENTATIVE IN CONGRESS FROM THE VIRGIN ISLANDS Mrs. Christensen. Thank you, Madam Chair, and I want to thank you and Chairman Pallone and the ranking member for holding this hearing on implementing of HIT, an issue that has been of particular importance for me. Of course, it is important to all providers, but providers of color, those in minority and poor and rural neighborhoods in my district have a particular interest in how it is going to be implemented. The Health Information Technology for Economic and Clinical Health Act holds out great promise for improving medical care, and although a few would disagree, reducing health care costs in the future. But I also want to make sure that it eliminates disparities, not exacerbate them. I appreciate the response of the public comments on what constitutes meaningful use, but if some of the big guys like Partners in Health Care, Kaiser Permanente and others have concerns about being able to meet the standards, certainly the smaller, poorer, understaffed, overworked providers will definitely have problems. I can imagine that OMC has in balancing the need to get this implemented, ensuring privacy and bringing all providers in. On the other hand, I know the challenge of providers like I was would have getting this implemented while trying to take care of patients. We will be looking to the regional extension centers like the one at the University of Ponce in Puerto Rico with the Virgin Islands Medical Institute for their help in getting this done. Dr. Blumenthal, in your testimony you say that we should look at this not as investments in technology per se but as efforts to improve the health of Americans and the performance of their health care system, and of course key to improving the health of all Americans is to ensure that those who are disproportionately affected by health inequities are able to access and take full advantage of the provisions of the HITECH Act. So I look forward to the testimony and thank and welcome our witnesses for being here today. Mrs. Capps. The Chair now recognizes Mr. Burgess for an opening statement. OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS Mr. Burgess. I thank the Chair for the recognition. Welcome to our witnesses. We are grateful that you are here. I am grateful that our committee is exercising proper oversight to see if the HITECH provisions of the stimulus bill are being implemented as intended. After all, the United States Congress put $20 billion on the table with the goal of increasing and ultimately achieving universal electronic medical record adoption. For the record, I did not support the stimulus bill and I continue to believe that some of the provisions relating to health information technology contained within that bill have actually been inhibitory toward their adoption. I am still uncertain whether providing financial incentives such as grants will be effective. I continue to believe that claims-based incentives ultimately make more business sense. In addition, our lack of addressing safe-harbor issues is a flaw, and early in an early iteration of a health IT bill, H.R. 1031, I introduced such a concept but unfortunately it was not part of the language that was adopted by the majority when the stimulus bill was passed. I would also like to be certain that new federal guidelines are working in coordination with the quality improvement initiatives that many in the industry are already undertaking and certainly not work at cross purposes to those efforts. We need to focus on implementation. Even if I didn't agree on how, I am committed to ensuring that the taxpayer dollars are now used responsibly to establish the goal that was set forth. Even if $1 doesn't go out the door, penalties for providers are coming no matter what, and guess what? They are coming pretty darn fast. They will be here in just a couple of years. I have been committed to see that the rules set up by the federal government encourage adoption and allow providers to avoid the proverbial sword of Damocles hanging over the head of every doctor and every hospital in the country in just a few short years. I have certainly been fearful that federal regulations might bog down the normal and routine medical treatment by requirements that are unnecessary and that I imagine both patients and doctors will have some difficulty with complying. Unfortunately, the draft regulations put out in February were, in a word, unworkable. I authorized with representatives Space, Stearns and Engel a letter pointing out several issues with the proposed rule. These were so intuitively obvious that 250 Members of Congress agreed to sign on to the letter. Dr. Blumenthal, to his credit, has always taken my calls, always listened to my concerns and did address many of the issues that were raised. I do remain concerned about the multi-campus issue which has been mentioned and on certification of existing systems as qualified to receive incentive payments, and Madam Chairwoman, I would like to insert into the record a statement by the Premier Health Care Alliance addressing that issue. So we will continue to work in Congress on legislation to address these issues as they come up. We hope we can achieve a bipartisan consensus with our members in this committee on both sides of the dais and with committee members of Ways and Means. I certainly look forward to hearing the testimony today and I will yield back the balance of my time. Mrs. Capps. Hearing no objection, the Chair will insert the letter that is recommended by the gentleman. [The information appears at the conclusion of the hearing.] Mrs. Capps. And now turning to Mr. Sarbanes for an opening statement. OPENING STATEMENT OF HON. JOHN P. SARBANES, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MARYLAND Mr. Sarbanes. Thank you, Madam Chair. I look forward to the testimony from the witnesses today. The search for the tipping point on health information technology has sort of been for some like the search for the Holy Grail. I don't think when we get there that is what it will turn out to be but I do think it is going to make a huge difference, first for patients and then for the costs of the system in terms of reducing cost, promoting more efficiency and so forth. I always have every head in the room nod when I talk to an audience about how frustrating it is when a patient goes to a provider and has to have the baseline medical record recreated for them because it is so difficult for the provider to put their hands on tests and other records that have been done and are available out there somewhere but they somehow can't get hold of those, the result being that the patient is then subjected to more tests, more pushing and prodding when that information that we give the provider a baseline picture of the person's health and condition is available, it is just not at their fingertips. And HIT has the potential to solve that problem. When it does so, it is going to make a tremendous advance forward for patient care and obviously, as I said, improve efficiency and reduce cost. So I think the investment in this both in the stimulus bill and in the health reform law was a smart investment. I am looking forward to hearing from you today as to how we are making progress on that investment, and I yield back my time. Thank you. Mrs. Capps. The Chair now recognizes Mrs. Blackburn. OPENING STATEMENT OF HON. MARSHA BLACKBURN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TENNESSEE Mrs. Blackburn. Thank you, Madam Chairman, and we do welcome our guests and we thank you for being here. We do want to keep tabs on what is happening with the HITECH Act, with health IT as it moves forward. We are concerned about the funds that were provided in the stimulus bill, what was included there and we are also concerned with the rules. I am glad that CMS has finally published the final rules for the electronic health records and we know that our doctors and our hospitals are working diligently to try to comply with these rules because we are hearing from them, and while we know that the EHRs are going to hold tremendous promise, we also know that we have got some hurdles out there if we are going to reach the goal of everyone having an electronic health record by 2015. I think that everyone is concerned with this deadline of January 1, 2011. We will have some questions about that because that is the time for provides to have in place a certified EHR to qualify for those Medicare health IT incentive programs, and between now and then our providers and vendors are going to have to ramp up very quickly. I will say, Madam Chairman, I think that when Congress does not engage in putting some of these items in statute and leaves it to agencies to put in place, we see unworkability and having to do some revisits. It also appears that CMS had lowered the bar in some areas in the recent rule while remaining overly prescriptive in others. An example, Tennessee hospitals are extremely concerned about the financial implications on multi-campus hospitals that share a single Medicare provider number. That is another area we will want to discuss with you today. What we must keep in mind that government excels at regulation, not innovation, and we are going to need to listen to the private sector on this and we will look forward to some questions there for our second panel, and as this rush is taking place to build this nationwide network very quickly, I am concerned that CMS could end up building a national but suboptimal system, and I hope that we are going to continue to see working through these problems together. Tennessee is a leader in the health IT innovation and implementation and we are hopeful that this can be put on the right direction and some of these concerns and stumbling blocks addressed as we move along the way. I thank you for the time. I yield back. Mrs. Capps. The Chair is now pleased to recognize the chairman emeritus of the full committee, Mr. Dingell, for his opening remarks. OPENING STATEMENT OF HON. JOHN D. DINGELL, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MICHIGAN Mr. Dingell. Madam Chairman, thank you, and thank you for holding this important hearing. Health information technology has the ability to modernize and improve our entire health care system by allowing for more informed decision-making, by reducing duplicative and unnecessary paperwork, by speeding up diagnoses and by reducing medical errors. The Health Information Technology for Economic and Clinical Health Act, HITECH, that was passed as a part of the American Recovery and Reinvestment Act of 2009, created an unprecedented investment in health information technology. In fact, the Congressional Budget Office noted the adoption of health IT would reduce Medicare spending by $4.4 billion over the 2011-2019 period and create federal savings in Medicaid over $7 billion in the same timeframe. Given this potential, we must ensure that we get a good return on that investment and vigorously move forward on the implementation of the statute. These resources will put us on the path to a more coordinated health care system, which is why the topic of health information technology has long been a focus of this committee. I would like to note that not only has this committee spent many years studying and legislating on the matter but that we have done so in a bipartisan fashion. For example, in the last Congress, this committee passed the bipartisan health information technology bill, H.R. 6357, the Protecting Records, Optimizing Treatment and Easing Communication through Health Care Technology Act of 2008. This bill included language to codify the Office of National Coordinator for Health IT and to provide grants designed to stimulate the spread of HIT. It also included strong privacy protections. This bill became the basis for the HITECH Act. The Administration recently issued rules, final in character, to support meaningful use of electronic health records. I am delighted that the Office of National Coordination for Health IT and Centers for Medicare and Medicaid Service have worked with all interested parties to develop standards that are attainable but also propel our health technology systems forward. They have had to thread a very fine needle, and overall they have done a commendable job. However, we all understand that a few concerns remain. I am confident the Administration will continue to hear and respond to the legitimate concerns. I am also aware that the work of the Congress may not be totally done on this issue. I want to thank both of the panels of our witnesses today for joining us and look forward to their updates on the implementation process. We will find that the testimony today will be in front of a group of people that has a real interest in ensuring that HITECH Act moves forward in a way that fulfills the intent of the legislation. Again, Madam Chairman, I thank you and I yield back the balance of my time. Mrs. Capps. The Chair is pleased to recognize for an opening statement Ms. Castor. OPENING STATEMENT OF HON. KATHY CASTOR, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF FLORIDA Ms. Castor. Thank you, Madam Chair, for calling this hearing on how we improve health care through modern technology. You know, the health care investments that have been made through the Recovery Act have really been a godsend to communities all across the country and created thousands and thousands of jobs including in my hometown of Tampa and the Tampa Bay area. One of the initiatives that I am most proud of was made possible by the HITECH Act included in the Recovery Act and it is the Paper-Free Florida Collaborative Regional Extension Center. In April, Paper-Free Florida was awarded nearly $6 million for its initiative developed by the University of South Florida in my district. It is one of more than 70 regional extension centers authorized by the Office of National Coordinator. I notice that Glen Tullman from Allscripts is here. He gave us great advice and encouragement from the get- go, so I am glad you are here, Glen. Paper-Free Florida will effectively implement electronic health records in more than 1,000 priority clinical practices, and I heard from the other side of the aisle where are the jobs. Well, I am grateful that a number of the jobs are right in my hometown in Tampa because what we are going to be able to do is recruit and train and employ over 100 e-health ambassadors as HIT extension agents in 20 countries. We are going to avoid costly medical errors for patients, and you should have seen the young doctors when we made the announcement. They are already there. They know this technology and they just can't wait to get started, and it is exactly what we intended by the Recovery Act, creating these high-wage jobs that communities like mine need in this economic downturn. So thank you. While I am proud that one of the many success stories made possible by the HITECH Act comes from my community, there are a few roadblocks that we need to address to ensure that more health care providers are able to coordinate care, and one area of improvement I think I am hearing consensus across the board here is the meaningful-use rules, and I think you for granting additional flexibility as you took comments from folks and providers all across the country, but we have more work to do here. Dr. Blumenthal, you have worked hard to make sure that certain entities that are eligible for HIT incentive payments are going to be eligible, but as many of the members today mentioned, the hospital systems with multiple campuses remain in a tough spot under these new rules. And I was with a chief medical officer in Florida for a big hospital system yesterday, they were singing your praises, but this is giving them real heartburn. The decision to allow only one payment per provider number, even if that provider number is used for more than one facility, puts multi-campus hospitals at a real disadvantage. Meanwhile, they have great potential to deliver results, the results that we need. Nevertheless, the overall benefit of the HITECH Act is among the most exciting components of the Recovery Act and alongside the Affordable Care Act, we will continue to make great strides to improve the health for American families. So thank you, Madam Chairman, and I look forward to hearing from our witnesses today. I yield back. Mrs. Capps. The next opening statement will be by Mr. Green. Mr. Green. Thank you, Madam Chairman. Before I begin I would like to ask unanimous consent to include a written statement for the record. This is written testimony of Dan Hawkins of the National Association of Community Health Centers. Mrs. Capps. Hearing no objection, so ordered. [The information was unavailable at the time of printing.] OPENING STATEMENT OF HON. GENE GREEN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS Mr. Green. Like my colleagues, I thank you for holding this hearing to check on the implementation and progress of the Health Information Technology for Economic and Clinical Health Act of 2009. For many years, this committee and Congress has the goal of encouraging large-scale implementation of electronic health records. The passage of the Health Information Technology for Economic and Clinical Health Act of 2009, HITECH, in the American Recovery and Reinvestment Act of 2009 demonstrated Congress's commitment to improving and coordinating patient care as well as streamlining and updating our medical records system. In a high-tech world, the days of paper records should be well behind us. With integrated information technology, patients can manage their own electronic records and avoid having to haul multiple records to various physicians. The lack of coordinated care in the country is startling, but if we can coordinate our care systems through health IT, we have a potential to change our health care system. We are all aware of the benefits improved IT will bring the health care sector and the patients it serves. If implemented correctly, health IT will improve patient safety and garner cost savings. That is why I am glad we are having the hearing today to discuss the status and the implementation of the HITECH Act. As we know, no legislation is perfect and Congress has a history of revisiting legislation many years after its passage. The HITECH Act is no exception. I am particularly interested in discussing potential changes that need to be made to assist community health centers and mental health providers adopt health IT. The implementation of health IT has dramatically improved the community health center coordination of care in our district and we are excited about the potential this has to improve quality of health care for medically underserved in the district. I do want to discuss how payments to health care IT are made to individual providers at the community health centers rather than the actual health center, which is a more common practice in allowing recurrent funding for health centers. With regard to mental health providers, I sponsored the Community Mental Health Services Improvement Act for many years. This legislation contains funding for the establishment of grant programs to improve health IT for mental health providers. I recently began working with Representative Patrick Kennedy and Representative Tim Murphy on H.R. 5040, the Health Information Technology Extension for Behavioral Health Services Act, which would amend HITECH to give mental health providers, substance-abuse providers and psychiatric hospitals in parity with other health care providers for medical use of health information technology and electronic health. This legislation clarifies the definition of health care provider to include mental health professionals, substance-abuse professionals, psychiatric hospitals, behavioral mental health clinic and substance-abuse treatment facilities. The legislation requires HHS through the National Coordination of Health Insurance Technology to award grants for mental health treatment facilities not eligible for meaningful-use incentives through the HITECH Act. The grants would allow for purchase of certified electronic records training of medical staff and the use of electronic records and improve the exchange of health information between mental health providers and other health care providers. I am hopeful these issues can be discussed in the future the community health centers and mental health providers are an integral part of our health care system. Again, I want to thank the witnesses for appearing. I want to welcome Dr. Roland Goertz, CEO and Executive Director of Heart of Texas Community Health Center in Waco on the second panel, and I yield back my time. Mrs. Capps. Thank you. Mr. Murphy is now recognized for his opening statement. OPENING STATEMENT OF HON. TIM MURPHY, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA Mr. Murphy of Pennsylvania. Thank you, Madam Chairman. We all know that electronic medical records hold enormous potential for the practice of medicine but tools like IT with health are only valuable if we know how to use them and if we have them, and that process began with more than $20 billion in federal resources allocated. Today, only 6 percent of hospitals and 2 percent of physicians rely on these health records. These incentives no doubt are going to increase participation but as I have heard from many doctors and hospitals in my district, that initial requirement for incentive payments seems to be too complex and unobtainable. Now with CMS cutting back on the scope of HIT mandates, it has given providers more time to adopt records that will collect essential patient data, and I look forward to hearing what providers can do before being financially penalized for noncompliance. HIT will be an essential component of medicine, or as Dr. David Blumenthal has put it aptly, as accepted in the daily lives of health professionals as the stethoscope and the exam table. Well said. Health IT is most valuable when it is available to providers across all disciplines, and as it advances, we want to make sure government is not a barrier but a team member to work better, effectively, efficiently and economically. I also believe that health IT needs to be integrated, interactive, interoperable and intelligent in order to provide great patient outcomes, and that is where I am afraid sometimes we may fall short in terms of integrating care, and let me give two quick examples. Patients in skilled nursing homes are extremely ill on average and take eight different kinds of medication. Eighty percent of this population comes from a hospital, but there is little exchange of patient data electronically, so a hospital may discharge a patient to a skilled nursing facility on Friday, the paper records are sent to the skilled nursing facility via fax a day or two later. If it was electronic, that facility could do a better assessment upon admittance and know the patient's medications immediately. Second, we need to be thinking about the overall health of an individual. Unfortunately, the incentives exclude mental health providers. As my colleague, Mr. Green, said, Congressman Patrick Kennedy and I have put in a bill, the HITECH Extension for Behavioral Health Services, H.R. 5040, to make mental health providers eligible for the federal incentive payments. This is a critical bill, and it would extend Medicare and Medicaid reimbursements for meaningful use of electronic health records to mental health professionals across a spectrum. So as Congress continues to support advances in technology, I look forward to working with this committee to secure passage of this bill and others. Keep in mind that those with chronic illness run the risk twice that of the population for having depression and other mental illnesses. We have to make sure that all these records are integrated together so that whatever medical problem they have, whatever complications people with chronic illness have, the key feature of electronic medical records is to make sure we can use them and provide the incentives and provide the facilities for us to be able to make better medical decisions. With that, I yield back. Mrs. Capps. Thank you, Mr. Murphy. Mr. Space, you are now recognized for your opening statement. OPENING STATEMENT OF HON. ZACHARY T. SPACE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF OHIO Mr. Space. Thank you, Madam Chairman. Thank you for holding the hearing on an issue that of considerable important to all of us. When it comes to health IT, there does seam to be a great deal of agreement on both sides of the aisle with very good cause. Both Democrats and Republicans, providers and consumer groups by and large seem to agree that improving the adoption of health information technology around the country will be beneficial to the practice of medicine, reduce redundancies, save money, provide a safer environment for patients and I certainly include myself in this support. How we achieve the adequate adoption of health IT is what has brought us here today. Ensuring that every hospital, doctor and clinic in this country have high-quality record systems that ensure patient safety is not an easy task and there is no simple answer to how we reach that destination. The HITECH Act included as part of H.R. 1 earlier this year offers a promising framework for accomplishing this goal, establishing an Office of the National Coordinator and developing a structure for incentive payments has created a framework for pushing the adoption of health IT in a strategic and meaningful way. However, the meaningful-use rule provided by CMS 2 weeks ago holds some troubling provisions that I fear may steer us away from adoption, and I would like to touch on two of those issues today. First, the multi-campus issue that was brought up earlier I think during Mr. Burgess's statement. I believe firmly that it was the intent of this body in passing the HITECH Act to ensure that each hospital would be entitled to its own incentive payments. The rule offered by CMS denies those payments to hospitals that have chosen to structure themselves with multiple campuses under a single provider number, and I am disappointed in this decision, particularly after we worked with Representatives Burgess, Engel and Stearns to send a letter to CMS that was signed by 240 members of this body. My staff will continue to work with those members and their staffs along with the staff of this committee and the Ways and Means Committee so that this issue can be resolved. And the second concern we have is what this rule will mean for smaller rural hospitals, like the 13 that we have in Ohio's 18th Congressional district. Most of those hospitals, indeed, all of those hospitals, see an exceptionally high caseload of Medicare and Medicaid recipients with an ever-growing number of self-pay cases. That is a euphemistic term for charitable cases. We see these cases increasing with the economy. For these hospitals, investing in the needed capital to purchase health IT systems that meet the criteria spelled out today is especially challenging. Even with the promise of incentive payments, these investments are costly and difficult. I still have concerns about what these requirements will mean for our hospitals and I certainly hope to learn more about how HHS and CMS intend to help small rural hospitals in accessing this vital technology. Thank you, Madam Chair. Mrs. Capps. Thank you. The Chair recognizes Mr. Barrow for an opening statement. OPENING STATEMENT OF HON. JOHN BARROW, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF GEORGIA Mr. Barrow. I thank the Chair for the opportunity to explore this topic. In getting ready for this hearing, I reached out to some of the folks on the ground back in my district and some of the folks who represent them up here, and there still seem to be a lot of unknowns and unanswered questions out there. We spent a lot of time poring over legislative language and debating the definitions of legislative terminology. I would like to bring to the attention of the committee some of the more fundamental challenges that I am talking about. I represent areas that don't even have access to reliable broadband services. I represent counties that are at least an hour's drive away from the nearest IT professional. I am concerned that even if we do everything right up here, we make grant funding available, we offer technical guidance, we provide reasonable rewards for proper implementation, many providers out there are still going to be left behind because we still don't have the proper technological infrastructure in place to take full advantage of this. So my concern is that we make great leaps forward in all other kinds of places with information technology that we don't forget those folks who are still struggling to get on board the IT bandwagon in the first place, and I hope that can be addressed in the course of the hearing. Thank you, Madam Chair, and I yield back the balance of my time. Mrs. Capps. Ms. Harman, the Chair recognizes you for an opening statement. Ms. Harman. Thank you, Madam Chair. It is nice to have a school nurse in the chair, and the quality of school nursing care matters to this committee, and I think electronic IT will be helpful even at that level, and I am sure you agree with me. Mrs. Capps. Absolutely. OPENING STATEMENT OF HON. JANE HARMAN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA Ms. Harman. Most of our colleagues have described what is in this legislation, which is absolutely essential. I just wanted to add a couple of things that haven't been said. One is that a firm in my district makes dog tags, electronic health dog tags for soldiers, and has had some success in selling these to the Pentagon. I have no idea, and probably others would know better than I, whether these could have a civilian application, but the notion that a soldier hit on the battlefield would have all of his health records in this tiny little chip that he wears around his neck is an exciting idea and it might really be useful to people who for any number of reasons could get into problems and urgently need one health provider to be able to download their history. There would obviously be some notion of choice here. I don't assume everyone would be compelled to wear these things, but I just put it out there as something that I think may have promise. The other thing I would want to mention that has been said, I am sure, before but not while I have been sitting here is the issue of both privacy and accuracy of records. I mean, once we consolidate and integrate health data, and boy, do I think ``integration'' is a critical word, it has to be accurate. The goal here is obviously to reduce errors and duplication, but what is on those records really matters and so while our legislation goes a long way in that direction, I just mention to our witnesses that this is something that will need renewed focus. And I congratulate this committee for legislating on a bipartisan basis in an area that is absolutely critical to the quality and cost of health care for Americans including school kids who go to excellent school nurses like our friend Lois. Thank you very much. I yield back, Madam Chair. Mrs. Capps. And on that note, we conclude our opening statements by members of the subcommittee and we turn now to our witnesses. I want to welcome you both and thank you for your patience in listening to all of us. We have on our first panel Dr. David Blumenthal, National Coordinator of Health Information Technology for the U.S. Department of Health and Services, also joined by Mr. Anthony Trenkle, Director of the Office of E-Health Standards and Services, Centers for Medicare and Medicaid Services. Welcome to you both. Dr. Blumenthal, you may begin your testimony. STATEMENTS OF DAVID BLUMENTHAL, M.D., NATIONAL COORDINATOR, HEALTH INFORMATION TECHNOLOGY, U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES; AND ANTHONY TRENKLE, DIRECTOR, OFFICE OF E- HEALTH STANDARD AND SERVICES, CENTERS FOR MEDICARE AND MEDICAID STATEMENT OF DAVID BLUMENTHAL Dr. Blumenthal. Chairwoman Capps, Ranking Member Shimkus, distinguished subcommittee members, thank you for the opportunity to submit testimony on behalf of the Department of Health and Human Services regarding the implementation of the Health Information Technology for Economic and Clinical Health Act. The provisions of the HITECH Act are best understood not as investments in technology per se but as efforts to improve the health of Americans and the performance of their health care system. Three interdependent rulemakings were required to implement the provisions of the HITECH Act generally and the Medicare and Medicaid EHR incentive programs in particular. The first rulemaking establishes the requirements that eligible health care providers will need to satisfy in order to qualify for incentive payments. The second specifies the technical capabilities and standards that certified EHR technology will need to include to support these health care providers, and the third creates the processes for EHR technology to be tested and certified, thus providing confidence and assurance to eligible health care providers that certify the EHR technology they adopt will perform as expected. On July 13th, with the issuance of the Medicare and Medicaid EHR incentive programs' final rule and the initial set of standards, implementation specifications and certification criteria final rule, a 17-month effort was capped to publish the three rulemakings necessary to implement meaningful use, stage 1. These rules cumulatively reflect over 2,000 public comments from stakeholders across the health care system and illuminate the initial pathway to achieving an integrated and electronically connected health care system. Our health information technology policy committee and health information technology standards committee played vital roles in advising me and the Secretary on these rules and many other matters. With the adoption of these three rules, attention now turns to their implementation. The ONC, the Office of the National Coordinator, is now ramping up the development of other processes that will need to be in place to enhance interoperability. Many of these processes will be components of a comprehensive standards and interoperability framework developed by the Office of the National Coordinate to expedite standards harmonization as well as their adoption and use. I am also pleased to report that in the approximately 4 weeks since the temporary certification program rule was finalized, ONC has already distributed 32 applications to organizations seeking to become authorized testing and certification bodies to test and certify EHR technology. I am highly encouraged by the strong interest shown thus far and I am optimistic that multiple organizations will be granted ONC- authorized technology and certification body status and thus be authorized to test and certify complete electronic health records and EHR modules under the temporary certification program. Such a result should create a competitive market and would provide EHR technology developers with multiple options and could lower the costs to EHR technology developers that are associated with testing and certification. ONC has engaged in a number of cross-cutting activities related to administering the provisions of the HITECH Act. The major program investment established to date with the $2 billion appropriated to ONC under ARRA include the Health Technology Extension program, the State Health Information Exchange Cooperative Agreement program, the Beacon Community Cooperative Agreement program, the Health IT Workforce program, and the Strategic Health IT Advanced Research Projects program. The Health Information Technology Extension program includes the establishment of a national health IT research center and a nationwide network of regional extension centers. Regional extension centers will be dedicated to ensuring that providers have all the necessary resources to meet the challenges ahead to adopting and becoming meaningful users of certified electronic health record technology. They will place a special emphasis on providing technical assistance to clinicians furnishing primary care services from individual and small group practices. The State Health Information Exchange Cooperative Agreement program has the overall aim to advance appropriate, secure and sustainable health information exchange within and across States and other jurisdictions. Over $500 million has been obligated to 56 States, eligible territories and qualified State-designated entities to support health care providers, demonstrate the meaningful use of certified electronic health record technology and to leverage the additional efficiencies and quality improvements gained from health information exchange. The Beacon Community Cooperative Agreement program provides certain communities with funding to build and strengthen their health IT infrastructure and health information exchange capabilities. These communities will demonstrate the vision of a future where hospitals, clinicians and patients are meaningful users of health information technology and together the community achieves measurable improvements in health care quality, safety, efficiency and population health. The HITECH Act provides for an unprecedented level of funding to improve the quality and efficiency of health care through HIT and its historic investment will undoubtedly help transition our current antiquated paper-dominated health care system into a high-performing 21st century health care system. It is my privilege to testify before you today and I look forward to continuing to work together in answering any questions you might have. [The prepared statement of Dr. Blumenthal follows:] [GRAPHIC] [TIFF OMITTED] 78126A.011 [GRAPHIC] [TIFF OMITTED] 78126A.012 [GRAPHIC] [TIFF OMITTED] 78126A.013 [GRAPHIC] [TIFF OMITTED] 78126A.014 [GRAPHIC] [TIFF OMITTED] 78126A.015 [GRAPHIC] [TIFF OMITTED] 78126A.016 [GRAPHIC] [TIFF OMITTED] 78126A.017 [GRAPHIC] [TIFF OMITTED] 78126A.018 [GRAPHIC] [TIFF OMITTED] 78126A.019 [GRAPHIC] [TIFF OMITTED] 78126A.020 [GRAPHIC] [TIFF OMITTED] 78126A.021 [GRAPHIC] [TIFF OMITTED] 78126A.022 [GRAPHIC] [TIFF OMITTED] 78126A.023 Mrs. Capps. Thank you very much, Dr. Blumenthal. Now Mr. Trenkle for your testimony. STATEMENT OF ANTHONY TRENKLE Mr. Trenkle. Thank you, Chairwoman. Chairwoman Capps, Ranking Member Shimkus and other members of the subcommittee, thank you for the invitation to discuss the CMS incentive program for electronic health records, which is part of the American Recovery and Reinvestment Act of 2009. Certified EHR technology use in a meaningful way is one piece of a broader health information technology infrastructure needed to reform our Nation's health care system and improve the quality and safety of care for both Medicare and Medicaid beneficiaries. On January 13, 2010, we published a proposed regulation that defined meaningful use and described the eligibility and payment methodologies for the EHR incentive programs. This NPRM was developed through close cooperation between CMS and the Office of National Coordinator and also allowed for extensive stakeholder input and recommendations from several federal advisory committees, in particular the HIT policy committee. The NPRM laid out three stages of meaningful use with stage 1 covering the first 2 years of the program. We received more than 2,000 comments on the proposed rule from interested stakeholders including health care providers, associations and patients. Most of the commenters felt that the proposed set of objectives was too difficult for stage 1 and asked for some flexibility in meeting them. The agency carefully reviewed and considered all submitted comments and took them into account in making policy decisions for the final rule. Our goal was to be as inclusive and flexible as possible within the bounds of the statute. We continued to work closely with ONC and received additional recommendations from the HIT policy committee. It is important that this program provides payment incentives for both Medicaid and Medicare. The programs have different statutory requirements but we tried to harmonize the meaningful-use requirements as closely as possible for stage 1. Both the CMS rule and the ONC certification standard rule, which sets out the functionality requirements for EHR, were displayed the Federal Register on July 13, 2010, and will be published in the Federal Register tomorrow, July 28, 2010. I will now discuss some of the key areas of the final rule. Eligible professionals, the major change in that was to expand the definition of ``eligibility'' to hospital-based physicians who work primarily in outpatient departments. This is made possible by a change to the original statutory language made in the Continuing Education Extension Act of 2010. Most Medicare Advantage-affiliated eligible professionals will also quality for this incentive if they are able to show meaningful use, and on the Medicaid side we provide additional flexibility for determining patient volume in order to quality more EPs. Eligible hospitals--we have received, as was noted by a number of the committee members, much comment and request that CMS recognize each campus of a multi-campus hospital for the incentive payments. We understand that this issue of importance to Members of Congress, the hospitals and the public. However, from the agency's perspective, we believe it is important to treat hospitals consistently, and the decision to deviate from longstanding policy in this particular instance without clear statutory direction to do so would have made CMS vulnerable to legal challenges asserting our policies are being implemented in an arbitrary manner. We intend to remain consistent with other payment policies and make incentive payments based upon how hospitals have organized themselves under provider numbers. There is a more detailed discussion of this issue in my written testimony and I am happy to respond to questions on this. We will continue to work with all interested stakeholders in future rulemaking related to the implementation. The other major hospital issue was with the Medicaid program, and in response to public comments on the proposed rule, we added critical-access hospitals to the definition of a Medicaid acute hospital in order to allow CAHs to quality for both programs. The major changes we made in the rule were with the meaningful-use definitions. As we mentioned in the NPRM, we received a number of comments that asked for more flexibility, and we decided to make some changes based on these comments that I will address in the next few moments. Some of the major changes were modifying the all-or-nothing approach to objectives that must be met for meaningful use and reducing this requirement to a required set or a core and a menu set or optional set. Eligible hospitals and professionals have the flexibility to defer up to five of the menu set objectives. Where appropriate thresholds to meet meaningful-use requirements were reduced in the final rule in response to comments. We also removed the administrative transaction requirements in the final rule in response to comments these transactions are often done through practice management software as opposed to EHRs. We also modified the States' ability to impose more-robust requirements that would have made it more difficult for Medicaid providers to achieve elevated targets. We believe it is important for States to have some flexibility so we preserved the flexibility. However, in response to the concerns raised, it was limited to four public health measures. We also added additional objectives for patient-specific education resources and advanced directives for hospitals were added in response to numerous requests in the comments and the HIT policy committee recommendations. It is important to note that Medicaid providers are not required to meet meaningful-use criteria in their first participating year. Instead, they may qualify for an incentive payment if they adopt, implement or upgrade certified EHR technology. In subsequent years, Medicaid providers must demonstrate meaningful use in order to receive the EHR incentive payments. The meaningful-use definition described for Medicare will also be the minimum requirement for the Medicaid EHR incentive program. Unlike the Medicare program, however, there are no Medicaid penalties for EPs and hospitals that will unable to demonstrate meaningful use. Finally, I want to mention that Congress recognized the critical importance of reporting quality measures through EHRs in the HITECH legislation. We support this requirement but recognize that the infrastructure to support the reporting of quality measures through EHRs is not yet available. In response to comments, CMS limited CQMs to only those which have electronic specifications. Eligible providers will now be required to report on three core measures from a set of 41 measures. Hospitals will be required to report on 15 measures as applicable to their population. In conclusion, the CMS and ONC final rules lay the groundwork for establishing a robust national health care infrastructure that supports the adoption of EHR technology that can help providers practice safer, more effective medicine. CMS understands the scope of these programs is vast and the doctors and facilities across the country have varying awareness of EHRs and of the program. We are working closely with ONC to conduct wide-scale outreach to educate those eligible for the program as well as working with the States and provider stakeholders. We look forward to working with Congress and our many stakeholder partners as we implement this rule and future rules and advance the use of HIT in our health care system. Thank you very much for allowing me to testify. [The prepared statement of Mr. Trenkle follows:] [GRAPHIC] [TIFF OMITTED] 78126A.024 [GRAPHIC] [TIFF OMITTED] 78126A.025 [GRAPHIC] [TIFF OMITTED] 78126A.026 [GRAPHIC] [TIFF OMITTED] 78126A.027 [GRAPHIC] [TIFF OMITTED] 78126A.028 [GRAPHIC] [TIFF OMITTED] 78126A.029 [GRAPHIC] [TIFF OMITTED] 78126A.030 [GRAPHIC] [TIFF OMITTED] 78126A.031 [GRAPHIC] [TIFF OMITTED] 78126A.032 [GRAPHIC] [TIFF OMITTED] 78126A.033 [GRAPHIC] [TIFF OMITTED] 78126A.034 [GRAPHIC] [TIFF OMITTED] 78126A.035 [GRAPHIC] [TIFF OMITTED] 78126A.036 Mrs. Capps. Thank you, Mr. Trenkle. And the statements of both of our witnesses in the first panel will be made a part of the hearing record. Each witness may also submit additional pertinent statements in writing and at the discretion of committee be included in the record, and now I recognize myself for 5 minutes of questioning. My first question is for you, Dr. Blumenthal. Dr. Blumenthal, I believe that health information technology will benefit all of us but it can also be particularly important in improving the health of individuals with complicated comorbidities such as people with severe mental illness. I am aware that mental health providers are not authorized to participate in Medicaid and Medicare reimbursement under the HITECH Act. Because of that omission, I am a cosponsor of a bill I want to acknowledge by our colleague here, Mr. Murphy, and our colleague in Congress, Mr. Kennedy, H.R. 5040, to correct that situation. I do worry that without health information technology it will becoming increasingly difficult for behavioral health providers to provide the necessary coordinated care for people with serious mental disorders. They cannot receive reimbursement for adopting HIT. Can behavioral health providers participate in any part of the HITECH Act technical assistance regional extension center program and will you describe that for us? Dr. Blumenthal. Sure. Thank you, Madam Chair. Well, as a long-term primary-care physician, I well understand the value of behavioral health information. I treated many patients with dual diagnoses, that is behavioral health and problems or substance-abuse problems as well as so-called physical problems. So it is absolutely vital that that information be available for accurate and careful management of patients. There is no question that the regional extension centers can serve any physician who is using electronic health record and intends to become a meaningful user of that electronic health record. There are certain priority providers that we have outlined in order to achieve the intent of the law and we have focused on primary-care physicians, critical-access hospitals, physicians in small groups and in underserved areas but there is no restriction that prevents a regional extension center in addition from serving mental health providers. Mrs. Capps. And you are reaching out to these communities? Dr. Blumenthal. Yes, we are. Mrs. Capps. OK. So that they know about what services they can be eligible for? Dr. Blumenthal. We certainly are making every effort to make those services known. Mrs. Capps. May I also mention another topic? The HITECH Act provided $2 billion to the Office of the National Coordinator for Health Information Technology, partly to build an infrastructure that promote the electronic exchange and use of health information. Can you describe how the health information network and the health information exchanges are critical to this effort? Dr. Blumenthal. Well, exchange is absolutely essential to good health-care management. Knowing what your patients' experiences have been in other locations is a great benefit, potential benefit of health information technology. At the same time, we need to make it possible for exchange to occur. It is not something that is under the control of individual providers. Exchange is in many ways a team sport. You need to have someone out there to get your pass when you throw the pass and you need to be able to take the pass when it comes back to you. So the health information exchange cooperative agreement programs that provide funds to the States are meant to empower the States and encourage the States to lead in the development of health information exchange capabilities within state jurisdictions and across state jurisdictions. Similarly, the Office of the National Coordinator has undertaken an aggressive program for the development of new standards and technologies that can provide a tool kit for exchange that the States can use and that local service providers can use. Mrs. Capps. One final question to you. Your office, I know, has been in touch with the providers that are required to start exchanging health information electronically but once they have begun that, is there the national infrastructure to allow it to continue to work forward? In other words, are you building a network? I have just a half a minute left for you to respond. Dr. Blumenthal. We want very much for this to be an ongoing feature of the health-care system and of health information technology so we are working hard with our health information exchange groups at the State level to make them sustainable over time. Mrs. Capps. So there is a network that is building within the State and then will that filter---- Dr. Blumenthal. Absolutely. That network has to be created or else exchange will not continue. Mrs. Capps. Thank you very much. Mr. Shimkus. Mr. Shimkus. Thank you, Madam Chair. First, I want to segue into and follow on the line of questioning that Mrs. Capps talked about. Also, there is a provision on the absence of physical therapy as part of being not eligible to receive and I just want to throw that out there. I think your answer would be very similar in the response. But I think it is worth noting that there are some gaps there and there will be a debate on who is eligible and who is not eligible. Dr. Blumenthal, what happens to eligible professionals and hospitals that fail to meet the meaningful-use requirements? Are they penalized? Will they be penalized? Dr. Blumenthal. Well, Congressman, the law specifies what will happen for failure to meet meaningful use. Mr. Shimkus. And since you are implementing that law, what would that be? Dr. Blumenthal. Well, as of 2015, eligible providers that have not implemented, not become meaningful users would be potentially penalized in their Medicare and Medicaid---- Mr. Shimkus. When? When will that start? When will the penalties start? Dr. Blumenthal. Twenty fifteen. Mr. Trenkle. Yes, 2015 is specified in the legislation. Mr. Shimkus. We don't have any idea based upon where people are in a survey of projection of how many providers may be penalized? Dr. Blumenthal. I think it would be premature to speculate about that. Mr. Trenkle. We put some estimates in the impact analysis as part of the regulation, but---- Mr. Shimkus. And what would those analyses show? Mr. Trenkle. We had both a high- and a low-end projection for that. Mr. Shimkus. I will give you a chance to look for that. Mr. Trenkle. No, I have got them right here, actually. The projection we had on the low end was by 2015, 21 percent of EPs would be meaningful users, and on the high end, 53 percent would be meaningful users, but keep in mind that that represents numbers based on previous studies that our actuaries used to come up with these numbers. They don't take into account what the effects of outreach and other activities that will be done under this Act will do. Mr. Shimkus. You know, and I think from colleagues on both sides of the aisle, especially those of us who represent rural communities, I think, you know, our one of many concerns would be major institutions have the capital or the foundations to move in the aggressively upfront cost. Poor, rural hospitals do not, and our concern is the timeline and our concern would be then when they are servicing in poor areas that they will then have a penalty when they are still trying to comply. So that is part of the question. Mr. Trenkle. Excuse me just a second, but the numbers I gave you were for the professionals, not for the hospitals. Mr. Shimkus. Well, it is true for them too. Mr. Trenkle. Right. I understand. Mr. Shimkus. What about the other issue that we have heard of is interoperability between the family practitioner and maybe the hospital, and the question would be, and it deals with the incentive payment issues. Who would pay if you have two systems that are not compatible and then you have to develop a compatibility software system? The family practitioner may balk and say well, that is our deal. The hospital may say well, that is not our deal. How are you going to take into consideration those issues? Dr. Blumenthal. Well, one of the reasons why we put back to stage 2 some of the more complete exchange capabilities was to give the local providers a chance to work those things out, come to agreements locally on who is going to do what to create exchange. I think the two key factors at work here are the incentives which will be available if exchange occurs, and perhaps for some the avoidance of penalties. And the second, the availability of good tools for exchange including open source free software, which we are developing. Mr. Shimkus. And my time is real short, but I want to just ask, in your testimony, Mr. Trenkle, you have a range of estimates between $9.7 billion and $27.4 billion over the next 10 years, and that is a pretty large range. Can you explain why that is the case and that can't be narrowed down a little bit more? Mr. Trenkle. For the purpose of the impact analysis, we did both a high- and a low-end scenario. As I mentioned a few moments ago, those are based on studies and actuarial projections. We also changed some of the numbers based on input we received from a number of organizations including the American Hospital Association, which allowed us to actually we had to lower the lower end because some of the cost projections and projections of getting up to speed had to be lowered because of the longer implementation lead time they projected. Mr. Shimkus. Thank you, Madam Chair. Mrs. Capps. Mr. Waxman, the chairman of the full committee, is recognized for his questions. The Chairman. Thank you, Madam Chair. The gathering of health IT should not be a goal in itself. It is a worthy goal, but that is not the only reason we want it. The lack of timely clinical information is a contributor to our Nation's well-documented problems with uncoordinated care. Health IT is a tool that can help deal with that problem right at the time of the patient's visit. The health reform legislation contains numerous policies to improve the delivery system such as establishing accountable care organizations, reducing hospital readmissions and moving towards greater bundling of services. Dr. Blumenthal and Mr. Trenkle, what role will health IT play in making sure these kinds of delivery system reforms are successful? Dr. Blumenthal. Well, Mr. Chairman, you can't have accountable care organizations without knowing how to make them accountable, and to be accountable you need to know what you are doing, and health IT is the best possible source of good information about performance in real time quickly. Once you have a system up and going, the system should generate information about quality and efficiency and cost in real time as a product of the work, not post-retrospectively through chart review, which is costly, lengthy, and by the time it is available often no longer relevant to the performance of the organization. So it is really I think enormously empowering for enabling providers to take responsibility for their performance. Mr. Trenkle. I would follow up on what Dr. Blumenthal with the fact that we are actually building infrastructure over the next several years that will support much of the health reform from the electronic specifications for the quality measures to the health information exchanges and the other work we are doing will allow us to have the infrastructure, that will allow the flow of data and support many of the objectives of health reform, so we feel this is a critical first step in moving towards some of the goals set out in the legislation. The Chairman. Is it fair to say that without health IT we wouldn't be able to have the reforms be as successful as we hope them to be? Dr. Blumenthal. Well, I would certainly agree with that, Mr. Chair. The Chairman. Now, there is another value in electronic health records. The availability of information in these records has the potential to support population research to better understand disease and treatment patterns. What plans are underway with other agencies to make use of the information for public health planning and what role do you think this can play in improving the quality and efficiency of health care delivery? Dr. Blumenthal. That is an excellent question. We are working with our sister agencies to try to define how records can privately and securely capture and make available information that is relevant to the missions of other agencies like the Food and Drug Administration or the National Institutes of Health or the Agency for Health Research and Quality or the Centers for Disease Control and Prevention, how we can, for example, in real time learn about the occurrence of influenza-like illness so that we can keep track of influenza epidemics and know where vaccine needs to be administered or keep track of foodborne illness outbreaks though real-time availability of information on related types of illness. So there is an enormous public health benefit and there is enormous value with patient consent and agreement recruiting patients into clinical trials for relevant new experiments whether it is in cancer or heart disease or diabetes, patients who want to be part of these experiments but who might otherwise be located without the benefit of the information that is available in electronic form. Mr. Trenkle. Let me also mention that under the meaningful- use objectives, one of the major goal areas was to improve population in public health and we included a number of objectives that provide for the capability to exchange public health data, and as I mentioned in my testimony earlier, we are also allowing States to have the flexibility to make some of these objectives core measures and core objectives for the purposes of meeting the meaningful-use criteria for the incentive program. The Chairman. Thank you. I yield back my time. Mrs. Capps. Thank you, Mr. Chairman. The Chair recognizes Mr. Gingrey for 5 minutes of questioning. Mr. Gingrey. Madam Chair, thank you very much. I don't know who to ask this so I will ask both of you. The HIT policy committee adoption certification work group recently recommended that ONC work with the FDA and representatives of patient clinician vendor and health care organizations to determine the role that the FDA would play to improve the safe use of certified electronic health record technology. Recently the FDA has suggested that direct-to-consumer genetic tests--we had a hearing on that just last week--that those should be classified as medical devices for the purpose of oversight. Do either of you believe that the FDA should consider electronic medical records as medical devices for the purposes of regulating these records? Dr. Blumenthal. Congressman, our concern and the concern of the policy committee that you cited was to take maximum advantage of health information technology and electronic health records to improve the safety of concern, and what actually the committee focused on in addition to the FDA was other alternatives for collecting information about the implementation of electronic health records to make sure that those implementations are as safe as they could possibly be. So we also discussed using patient safety organizations and using our new certification to collect post-market, post surveillance, post-certification surveillance information. So I think that the mandate to us, the recommendation to us, not a mandate, was to develop and look at all the ways we could collect information to make sure that our work was doing everything it possibly could to enhance patient safety. Now, whether or not the Food and Drug Administration takes any action beyond what it already has I think is premature to speculate about. They have no plans right now that I am aware of to do anything further than what they have already done. So we are right now at the Department looking at these information collection opportunities that we already have and have created and not looking at anything else beyond that. Mr. Gingrey. Mr. Trenkle, do you have any further comments on that? Mr. Trenkle. No, I agree with what Dr. Blumenthal said. Mr. Gingrey. I thank you. I hope that I understood correctly your response, Dr. Blumenthal, that you really don't think that the FDA should treat electronic medical records as a medical device. Dr. Blumenthal. Well, there are issues, there are legal issues which I am not qualified to speculate about as to what a device is or isn't. From the standpoint of policy, I would say there is no plan right now for the FDA to do anything of that sort. Mr. Gingrey. Thanks. I have got about 2 minutes left. Technology companies have told me, and we have a very good one in my district, the 11th of Georgia, in Carrollton, Georgia, I won't mention the name of the company but they are very good and they have been out there doing this for a while, that is, providing electronic medical record hardware and software to specialty-specific groups, general surgery, OB/GYN, et cetera, and they have told me how critically important it will be to have 12 to 18 months of lead time in order to align their products with the stage 2 criteria. Understanding how critically important quality products are to the viability of our future nationwide network, can you give these companies like the one in my district some public reassurance today that the development of stage 2 criteria will allow these companies a 12- to 18-month window in order to bring their products into compliance? Dr. Blumenthal. We are going to do everything we can to give companies as much warning as we can about what the criteria will be, and we want to have time to learn from stage 1 about what the experience has been of providers and vendors and others, patients, with the new rules and implementation efforts. So we want to wait a while before we get that experience. Then we also want to get the rules done as early as possible. Mr. Gingrey. Well, I don't want to interrupt you, but I definitely want to ask Mr. Trenkle a question before my time runs out. I have 10 seconds. You said to one of my colleagues that the issue of the final rule on the hospitals that have multiple campuses, that they would just be eligible for one meaningful-user incentive payment for Medicare and Medicaid. How about physician groups, let us say a family practice group of five individual physicians, they are affiliated in some way, how would you deal with them? Would that group only be eligible for one payment, $44,000 or $77,000, whatever it is, or multiple payments for each individual doctor? Mr. Trenkle. I just want to add one thing to the previous question on the meaningful use stage 2. We have, in addition to what David mentioned, we have also signaled in the preamble for this particular rule that we were going to move the menu items to the core objectives for stage 2 and also signaled our intent to add administrative transactions in stage 2 as well as increasing the percentage measurement for computerized physician order entries. So we have given some signals. But to answer your second question, we have--for this particular rule, we have payments are made to individual eligible professionals so they are not made by group, they are made by professionals, and we made that decision very much after listening to some of the comments, reading some of the comments that came in and listening to some of the concerns that people had on both sides where they felt the way the legislation was written and the ability to track the dollars spent in the performance to meet the criteria, we have determined that we would go with the individual eligible professionals. So if there are five members of a group practice, each one of them would have to show meaningful use to meet the requirements to get an incentive. Mr. Gingrey. But they would each be eligible if they did for the bonus payment? Mr. Trenkle. That's correct. Mr. Gingrey. Mr. Chairman, thank you. I thought that was very important. I am glad you let him answer. Mr. Pallone. Thank you. Our chairman emeritus, Mr. Dingell, is recognized. Mr. Dingell. Thank you, Mr. Chairman. Dr. Blumenthal, would you agree that lack of certified EHR technology has the potential to hinder our progress and discourage physicians from participating in the EHR incentive, yes or no? Dr. Blumenthal. I don't think that is going to be a problem, Mr. Dingell. Mr. Dingell. It does have the potential, though, does it not? Dr. Blumenthal. If certified technology were not available, yes, it would have that. Mr. Dingell. Now, if eligible providers don't know which technology will eventually pass the test, they will be slow to go out and buy it. Isn't that correct? Dr. Blumenthal. I don't think that is going to happen, but yes, that is correct. Mr. Dingell. It is a possibility. So it is critical that we have a strong certification program in place as soon as possible to provide some level of certainty for providers. Do you agree with that? Dr. Blumenthal. I agree with that. Mr. Dingell. And I don't want you to be defensive about this. I just want you to understand, I have the apprehension if we don't make these things flow, there is going to be trouble. Now, while the Medicare/Medicaid incentive programs begins next year, the permanent certification program is not expected to be fully operational until early 2012. Is that correct? Dr. Blumenthal. That is correct. Mr. Dingell. Now, what has the Administration done to remove the potential uncertainty surrounding certification to ensure that we have as much as early participation for providers as possible? Dr. Blumenthal. Well, we have already published in mid-June a final rule creating a temporary certification process which will be in existence until the final permanent process is available. That process can certify records, will certify records, will certify them by the fall, so that we believe there will be ample time for eligible providers to have not only installed a record but have some time to look them over, think about what they want to install, and then some time to install them, and still qualify for the full payments available under the incentive plan. Mr. Trenkle. Congressman Dingell, can I make a comment also? One of the things we took into account when establishing the criteria for meaningful use is to have a 90-day reporting period in year one in recognition of the fact it will take some time to set up the certification program and also to allow the providers and hospitals additional time to sign up for the program and demonstrate meaningful use. Mr. Dingell. Thank you. I think you are both telling me then that the temporary program is necessary but that it is not going to be sufficient over the long haul. Is that correct? Dr. Blumenthal. The temporary program will be, we hope, a high-quality program but it won't meet all the criteria that certification bodies should meet in order to meet international standards. Mr. Dingell. Now, will the technology certified through the temporary program be subjected to additional certification under the permanent program? Dr. Blumenthal. It will continue to be certified for stage 1 until additional criteria come into play. Mr. Dingell. Now, Dr. Blumenthal, I note that HITECH has made substantial program investments including funding for support of the Beacon Community Cooperative Agreement program. The first round of awards were announced, and I understand that there were strong applications from Michigan, but I also understand that none of the Michigan applications were selected. Am I correct that you plan to announce two additional awards? Dr. Blumenthal. You are correct, sir. Mr. Dingell. And am I to assume that Michigan will be most sympathetically considered? Dr. Blumenthal. We will give it every sympathetic consideration, sir. Mr. Dingell. I will be looking forward to that. What will be the timeline for this announcement? Dr. Blumenthal. Middle of August, I believe. Mr. Dingell. Beg your pardon? Dr. Blumenthal. Mid-August, I believe. Mr. Dingell. Now, I would like to get your assessment of the current EHR marketplace. HITECH included a provision that would require your office to make certified EHR technology available if the marketplace fails to do so. Is that correct? Dr. Blumenthal. That is correct. Mr. Dingell. Now, what is your current assessment of the marketplace? Do you feel that there is adequate innovation currently going on so that I don't need to be apprehensive about the prior point? Dr. Blumenthal. I do believe so. Mr. Dingell. Mr. Chairman, I note my time has expired and I thank you for your courtesy. Mr. Pallone. The gentleman from Texas, Mr. Burgess. Mr. Burgess. I thank the chairman. Dr. Blumenthal, the American Medical Association in the brief that was submitted by Dr. Gingrey for the record makes note about the need for small physician practice representation on your policy committee. How are you addressing that? Dr. Blumenthal. I think that is a fair point. We certainly want to make sure that we have heard from the full spectrum of physician practices and perspectives so we would be, I think, open to that suggestion. Mr. Burgess. Another thing that I have encountered, I don't know if it has come up---- Dr. Blumenthal. Congressman, if I could just make one amendment to that? Mr. Burgess. Yes. Dr. Blumenthal. The membership of that committee is actually determined by the GAO and the Congress and then specified by law as to who else the Secretary can appoint. The only way we could appoint small physician practice representatives would be as a member of a working group, not as a member of the policy committee per se. That is just a matter of the way the law is written. Mr. Burgess. How many of those working groups do you have? Dr. Blumenthal. We have several, so it would be quite possible to include them. Mr. Burgess. I would also then ask you to consider, I know I have heard from a number of physicians who practice orthopedics that they face a particular challenge in instituting this technology from their offices and that the packages that are available to them, the products that are available to them that also include digital imaging, the broadband requirements are so high, the storage requirements so high that they are sometimes looking at systems that cost in excess of several hundreds of thousands of dollars which obviously is a barrier to entry. So I would encourage you to hear voices from across the spectrum of the real world in practice because ultimately these are the individuals you are going to count on to make this work, and if it is not workable for them, clearly we will have a problem. What happens to professionals who fail to meet the meaningful-use requirements? Dr. Blumenthal. Well, in the period between 2011 and 2015, they fail to accumulate the incentive payments that are available. In 2015 and beyond, they are subject to the penalties that were placed in the law with respect to Medicare reimbursement. Mr. Burgess. So if a practice elects to do nothing, it is not that they will just ultimately be left alone, they ultimately would be penalized by the provisions of HITECH and ARRA? Mr. Trenkle. Yes, if they are under the Medicare program if they qualify. Mr. Burgess. And what---- Mr. Trenkle. And that was legislatively mandated. That was part of---- Mr. Burgess. But what are the penalties that they are looking at? Dr. Blumenthal. I will let Mr. Trenkle answer that. Mr. Trenkle. The penalties are as they were put into the legislation. It is 1 percent in 2015 and then it goes upward beyond that, but we implement them as they were put into the legislation. Mr. Burgess. And just for the record, I argued strenuously against that type of punitive approach to this because I don't know if we have allowed ourselves enough time to ramp this up. Dr. Blumenthal, you have worked a Herculean effort this past year to get where you are right now. Imagine putting that effort on top of a small physician practice working 16 hours a day just to take care of their patients and pay their bills and keep their doors open with all of the other stipulations we have put up them. This one does seem onerous. For either of you, how many providers are going to be penalized? Do you have some notion as to how extensive this is going to be? Dr. Blumenthal. There are estimates that were made by the Office of the Actuary which I will let Mr. Trenkle summarize, but I will add a prior comment to say that all those estimates were based on experience prior to the availability of incentives and prior to the availability of the regional extension center program, the Beacon community program, our workforce training program and all the other efforts we are making to assist providers in becoming meaningful users. Mr. Trenkle. As I had mentioned earlier in a similar question, we had scenarios both high and low in the impact analysis that were compiled by our actuaries using data from studies and other information that they had. Mr. Burgess. Maybe you could get back to me with that in writing because I am going to run out of time and I would be interested in your response to that. Mr. Trenkle. OK. Mr. Burgess. But I guess one of the other follow-up questions I have is, obviously there are going to be people who have these systems for sale. Now, the people who have the systems for sale, the vendors, are they under any sort of punitive aspects under this law or do they just simply present their wares for sale and that is that? Mr. Trenkle. No, they are not under any penalties. The only issue with the payment adjustments was what was in the legislation. Mr. Burgess. Let me just see if I have this right. The doctors are under penalty, under threat of penalty if their practices are not compliant, but the doctors technically don't really make any money off of having an electronic medical records system. It may be good practice and it may be important for patient safety but they don't actually benefit on the bottom line from these systems and yet the vendors are going to significantly benefit from the forced sale to practices of these systems. Are you doing anything to mitigate that discrepancy? Dr. Blumenthal. Well, the provisions of the law are the provisions of the law, Mr. Congressman, as you well know, so we have limited--what we are doing is working very hard to make sure that every well-intended provider who wants to be a meaningful user has the opportunity to become a meaningful user and that--but they won't fail through any lack of effort on our part. So that is I think our commitment at the Office of the National Coordinator and from the federal government. Mr. Burgess. But with all due respect---- Mr. Pallone. The gentleman's time is a minute and a half over. Mr. Burgess. I will follow up with this in writing because this is an important point, and we have already seen how your rulemaking has progressed since the beginning of the year, and it is going to affect practices all over the country. Mr. Pallone. Thank you. Let me mention that you will get additional questions from us in writing, and any member is entitled to do that. The gentlewoman from the Virgin Islands, Mrs. Christensen. Mrs. Christensen. Thank you, Mr. Chairman, and thank you both, Dr. Blumenthal and Mr. Trenkle. My first question is to you, Mr. Trenkle. The territories are not included in the EHR program under Medicare and Medicaid. It is just the 50 States and the District of Columbia. Is the reason because we don't use a prospective payment program? I don't see why that should make a difference but you can explain if it does. And Medicaid is different in the territories, and while I don't agree with that either, Medicare is not. And in the territories, Medicaid can only be used in public hospitals and public clinics. So why are we excluded? Mr. Trenkle. In determining eligible professionals and hospitals, we followed what was in the statute. Mrs. Christensen. OK. So we did it? Mr. Trenkle. Right, so you did it. Mrs. Christensen. We will try to see what we can do about that because it really shouldn't--in the territories, Medicare beneficiaries and Medicaid beneficiaries should benefit from the same benefits of HIT as everyone else. Don't you agree? Mr. Trenkle. Yes, I agree. As I said, we followed what was in the statute, so---- Mrs. Christensen. Thank you. Dr. Blumenthal, on the Beacon Community Cooperative Agreement program, and we heard that the first round has been awarded, certain communities are provided with funding to build and strengthen the HIT infrastructure and HIT capabilities. Could you describe briefly the criteria for other communities that are chosen? I am trying to get at--and if you know this, if you would help me to understand, what proportion of racial and ethnic minorities and low-income communities were served in the first round? Dr. Blumenthal. Well, I would like to get back to you with specific numbers. I can tell you that my memory is that the communities' populations are representative of the underserved populations in the country as a whole. The beacon community program was awarded, vendors were chosen through an objective review competitive process. As a matter of fact, it took place in the record-breaking snowstorm in February, and we funded those programs in the order in which they were picked by the external reviewers, just as an NIH grant would be awarded. The criteria took into account of course the quality of the application. It did take into account diversity. Seven of the 15 are rural communities. And it took into account the commitment of the communities, the quality of the health IT infrastructure, the governance arrangements and the believability, the credibility of their goals which were very precisely laid out in the applications. Mrs. Christensen. Did you identify or have to respond to any unique challenges in the implementation process or through the comment process from poor, rural or communities of color? Dr. Blumenthal. We certain tried to. There is a beacon community in the Mississippi delta. There is one in the Piedmont area of North Carolina. There is one in Tulsa, Oklahoma. So they really go from Hawaii to upper New York and I think are quite representative of the country as a whole. Mrs. Christensen. And I guess to both of you, and you may have answered this already but I didn't see it in reading your testimony specifically. How have the providers been incorporated into the setting of the standards, not just in the comment period but as you were developing the standards? Were doctors, hospitals, other providers included? Dr. Blumenthal. We have two advisory committees that you all provided us under the statute, the policy committee and standards committee. They meet in public. Their work groups meet in public. We have had over 180 public meetings of those groups. We have had testimony from a wide range of advisors. Mrs. Christensen. One other question. I am sorry. I am hearing your answer. But there is room, because many older doctors are used to dictating. Is there room in EHR for including the dictation transcription process in the implementation since that might provide an easier transition? I needed to get that question and I have to leave, so I am sorry for cutting you off but I hear where you were going with your answer. Dr. Blumenthal. Well, progress notes are not part of the requirement for meaningful use in stage 1, so yes, there would be an opportunity to dictate into the record in stage 1. Mrs. Christensen. Thank you, Mr. Chairman. Mr. Pallone. Thank you. Next is the gentleman from Ohio, Mr. Space. Mr. Space. Thank you, Mr. Chairman. Mr. Trenkle, like many of my colleagues, the hospitals, as I mentioned in my opening, in my Congressional district are going to be impacted, at least some of them, by your decision on multiple-campus hospitals, and in fact, Genesis, which is one of the largest hospitals in my district in Zanesville, Ohio, the largest city in my district, stands to lose about $2 million in incentive payments based on your rule and, as you might understand, they are little frustrated by that rule. Won't decisions like this ultimately make it more difficult for hospitals like Genesis Hospital to adopt the very technology that this law is designed to promote? Mr. Trenkle. As I mentioned in my written and in my oral testimony that we base this on existing policy and the provider number is based on how the hospitals choose to organize themselves for payments under other Medicare programs, so what we did here without clear statute intent was to be consistent with the payment policies that we have adopted for other programs, many of which, as I said, were due to hospitals themselves wanting to be organized in this manner to be paid in a certain way. Mr. Space. So absent clear statutory intent, at this point you don't envision reconsideration of that rule? Mr. Trenkle. That is correct, although we are happy to be working with committee staff and others to look at potential ways to work with us. We recognize that there has been a lot of public comment as well as comment from yourself, your staff and other staffs here that express concerns about them. We have heard, of course, from many hospital groups as well. Mr. Space. I appreciate your working with us on it because it is a real problem for us and for our health care providers which already are at so many disadvantages, given the rural nature of our district, and the class of patients, the Medicare, Medicaid, self-pay percentages are so high. In fact, we have got one hospital now that is desperately attempting to avoid bankruptcy and if these hospitals can't survive, it will have a direct and profound impact on the folks that live in places like Ohio's 18th district, and broadband and health IT represents an opportunity to bridge many of the divides that exist between rural America and urban and suburban area. So I am grateful that you have expressed a willingness to work with us. Dr. Blumenthal, I understand last week you testified before Ways and Means and you mentioned that Secretary Sebelius had convened a working group on rural providers. Can you talk a little more about how this working group will help hospitals like the ones that I represent meet the health IT standards? Dr. Blumenthal. Secretary Sebelius, as you know well, Congressman, was the governor of a rural State so she has been very interested in the issues that pertain to HIT access in rural areas. She is convening the secretaries of commerce, Agriculture, the Veterans Administration and the chairman of the Federal Communication Commission actually next week for a first meeting to discuss ways in which we can work together using the resources of these different departments to bring to rural communities the resources they need to be meaningful users of health information technology. I don't want to presume what is going to come of that meeting, it hasn't been held yet, but there are broadband resources available at Commerce and USDA. There are tele-health resources. The VA does a lot of outreach in its communities. The FCC spends $400 million a year on broadband and communications so we are trying to make sure that between the Department of Health and Human Services and these other agencies that we are dedicating all the resources we can to making up for the differences, the special burdens that rural communities have. Mr. Space. Thank you, Dr. Blumenthal and Mr. Trenkle. I yield back my time, my one second. Mr. Pallone. I thank the gentleman and recognize the gentleman from Connecticut, Mr. Murphy. Mr. Murphy of Connecticut. Thank you very much, Mr. Chairman. Thank you both for your all your work and for being here today. I wanted to build on a question that Chairman Waxman raised, and let me first pose it to you, Dr. Blumenthal. I think one of the most exciting pieces of the health care reform bill is the path forward we have set on the change in delivery system and the change in which we pay for medicine to really move from a system in which we today value volume to a day in which we can place the appropriate value on outcomes and quality. I am obviously very happy to hear your emphasis on the connection between health care IT and the day in which that can happen. I think your response to him was in regard to accountable care organizations, which I think will be transformative. I wanted to ask you about some other potential payment changes and new models of delivery. One of the pilot programs that I and others worked very hard on was looking at new ways to bundle payments in particular with respect to post-acute care, and in that setting, you are dealing with complex patients that are coming in and out of hospital and physician settings, often having some of their most expensive care in, for instance, skilled nursing facilities. I know we can't cover everybody with the payments in this law but I wanted to get your thoughts on how we continue to broaden out the number of providers that are eligible for these payments, or in the absence of doing that, how we find a way to get comprehensive health care information technology to places like skilled nursing centers so that we can really implement these payment delivery system changes that we know have the potential to do some great things. Dr. Blumenthal. Well, in my role as a provider, as a practitioner, a primary-care practitioner, I am extremely sympathetic to the need to bring long-term care, home care, rehab in coordination and get the information from those sites into the acute care part of the system. As you pointed out, the law as currently structured does not make incentives available to those provider settings, and that is a limitation. It doesn't prevent, though, those institutions from finding electronic heard record technology themselves, especially if bundled payment arrangements were to make available some savings that they could get access to and if having that technology enabled those savings as I am certain it would. So I don't think we should forget that the rest of the health care world continues to march along and that this technology is really inevitable. It is the way to collect and use information and it will take over other sectors as well. Mr. Murphy of Connecticut. I don't know exactly what the number is but the statistic always given about the very small number of patients who comprise a very large number of costs, these are patients that are obviously in and out of hospital settings and so whether it is through bundled payments or another way, I do think we have to find a way to get some help, especially skilled nursing. Maybe I will ask the question, a little different version to you, Mr. Trenkle. As HHS is looking at and CMS is looking at how to implement these new payment methodologies or these new pilot programs for delivery system change, are you looking at implementing them on a time schedule that is consistent with the rollout of health care information technology and specifically on this change, post-acute-care bundle payments, are you worried that there will be a lag in development of good IT systems in skilled nursing facilities that might present a barrier to that particular pilot program? Mr. Trenkle. I don't have all the implementation dates here but I will tell you, we are working closely with other parts of the agency to ensure that we are coordinating with the rollout of the health care reform implementation and the HITECH provisions. Mr. Murphy of Connecticut. One last question, back to you, Dr. Blumenthal. Talking about certification, the temporary system that we have set up today, obviously one of the things you hear a lot about is providers and hospitals who have been early adopters and who fear that they are going to be forced to make some expensive and onerous changes going forward. Do we expect that the certification process will be only for new technology or do you think we will have existing technology that might be out there today, it might have been out there for a period of time certified as well? Dr. Blumenthal. The requirements for certification are new because the meaningful-use requirements are new, and we know that frequently technology that is in place, though it may be beneficial, doesn't meet the standards or the certification requirements that meaningful use has created. So we can't assume that technology in place right now is capable of supporting meaningful and therefore we can't assume that it is certified. So yes, if you have technology right now that hasn't been certified under the new certification process, you will have to get it certified. It may be quite easy to do that. It may be that you have technology that is very capable. But we can't assume that, and we don't want to create the impression for providers that something they are using now will be capable of meaningful when it is not. Mr. Murphy of Connecticut. Nothing preventing an existing system from being stamped as certified as long as it meets that requirement? Dr. Blumenthal. Absolutely not. Mr. Murphy of Connecticut. Thank you. Again, thank you for all your work. This is incredibly important. I appreciate your being here. Mr. Pallone. Thank you, Mr. Murphy. I am going to recognize myself since I wasn't here earlier. I assume, and I missed the beginning, that there was some discussion about meaningful but it is the most or one of the most controversial aspects of this round of rulemaking, and demonstrating meaningful use is the key to attaining eligibility for incentives for Medicare and Medicaid so there is a lot of interest from provider communities about how those rules are structured. So I wanted to ask each of you, first, Mr. Trenkle, you have been criticized for setting the bar too high for providers to demonstrate meaningful use. Others have said the agency isn't demanding enough from providers. I actually haven't heard that one. Please, if you would explain to the committee how you define the balance between high standards and reasonable expectations and how the final rule reflects that balance.--- Mr. Trenkle. Yes, I would be happy to do that. I think it is important to point out that the final regulation reflects a 17-month process. The Recovery Act was passed in February of 2009. The final rule came out in July of 2010. And during that time we convened several committees that as Dr. Blumenthal mentioned received input from a number of stakeholders. We had a public comment period of 60 days. We came out with a notice of proposed rulemaking. We heard back from the community that a lot of the objectives were too high so we adjusted in response to the comments. So I think a combination of all these efforts have led us to what we believe is a balance between a strategic framework for promoting future adoption and meaningful use and recognizing the realities of the infrastructure and the adoption rates today. Mr. Pallone. I mean, I guess the concern that I hear is that a lot of providers simply won't meet the bar and then our efforts are in vain, but at this point you don't feel that is the case? Mr. Trenkle. Well, I think we heard loudly from the community that the bar was too high so we have added flexibility in terms of the objectives. They have a core and they have a menu set. We lowered some of the thresholds. We eliminated the administrative transactions and we did a number of other changes to the meaningful-use requirements that reflected a need to lower but also maintain a framework that will propel us towards future stages. Mr. Pallone. All right. Let me ask I guess essentially the same question of Dr. Blumenthal. from your experience, do you believe that providers will be able to meet the meaningful-use criteria laid out in the final rule? Dr. Blumenthal. I believe they will. I believe there are tens and even hundreds of thousands of physicians who are already effectively using electronic health records and are close to meeting meaningful-use criteria. By the way, that is true of many small hospitals as well, critical-access hospitals. I have met with them and seen them with my own eyes. So I think it is quite possible to do this, and the question will be whether the physicians and hospitals feel that it is possible and will devote themselves and make the effort. We have to make sure that the taxpayer was rewarded with getting real value from these records for the tens of billions that were in the legislation, but at the same time we have to make sure that it was achievable, and that is a balance that we have been trying to find constantly over this 17-month period. We will closely at what the experience is, try to learn from that experience and see whether we have set the bar at the right level. So we have done our due diligence. We have made our best analyses and we are moving forward from there. Mr. Pallone. I heard some of the members say that they were concerned about the penalty if someone doesn't move forward at a certain point with the HIT, but there is also an exemption. Do you want to address that, Mr. Trenkle, in case we run into a situation where they are facing the penalty but---- Mr. Trenkle. Yes, I should have mentioned that earlier, that there is a legislative exemption in case of hardship on a case-by-case basis, and we will need to define the criteria for that hardship in future rulemaking. Mr. Pallone. But that is not something you are doing in this first round, in other words? Mr. Trenkle. No, because the adjustments aren't scheduled to come in until 2015 so we will be addressing that in future rulemaking. Mr. Pallone. All right. I know I have got a couple minutes here. I just wanted to ask, you know, I always get the questions, Dr. Blumenthal, about the small practices. The majority of physician practices continue to be small practices of one or a few physicians and of course, you know, given the economics today, a lot of them are struggling, and it is an investment obviously to move towards health IT and they say it is going to decrease productivity when it is initially implemented, a lot of things of that nature. What would you say about that? I mean, the HITECH Act provides $2 billion to your office but there is also the regional extension centers and beacon community programs. Is this going to be some way to help these single practitioners, or how do you envision that? Dr. Blumenthal. Well, the small practice if the target of the Regional Extension Center program. That is where we are focusing our effort because we realize that those are the practitioners who are going to have the hardest time and are going to be the least attractive and have the fewest resources to attract a commercial vendor, a commercial consulting company or a so-called integrator to help them. So we are intending to enroll 100,000 small practices through the Regional Extension Center program in programs to assist them becoming meaningful users, and I think that is going to be a big opportunity for small practices, and over time I think we will learn how to do that better and better and we will continue to provide that. That is over the first couple of years. Later on I think we will be able to do more as time goes on. So they are very much aware of this group and the practice is changing and younger physicians are much more adept at adopting these technologies than physicians my age, and so I think over time this problem is going to largely take care of itself. Mr. Pallone. All right. Thank you. The gentleman from Texas, have you been recognized? I wasn't here earlier. The gentleman is recognized. Mr. Gonzalez. Thank you very much, Mr. Chairman. I apologize. I have been absent for much of the hearing, but I do thank the witnesses. I have a couple of questions. One is going to be more parochial. I will start with the more general one, and that is going to be--and first of all, the sources of the questions come from the medical community, hospitals and such in my area because my staff is very sensitive to getting their input, and they say why don't you ask these particular questions, and they are much better questions than I would come up with on my own, so I want to make sure that I get some of the, I guess the verbiage here, the quality improvement organizations and the proposed rules, and back home they are saying because of preexisting relationships with these quality improvement organizations with the regional extension centers, what do you see prospectively as those particular right now it may be prime or subcontractors with individuals in San Antonio--I am from San Antonio--as we go forward? Will you have some of these same individuals, organizations playing a role? It seems like it would be a good idea just because of preexisting relationships and of course the expertise that they would bring to the table. Dr. Blumenthal. Our regional extension centers, which is what you are referring to, I think, here were chosen on a competitive basis. We had many more applications through the regional extension centers than we were able to fund. I think about a third, if I am not mistaken, of our regional extension centers are quality improvement organizations so that that coincidence, that overlap already exists. Where are there are not quality improvement organizations, we are instructing the regional extension centers to work with quality improvement organizations and with all the other pertinent organizations in their community. Mr. Gonzalez. The other question, and I don't know how unique it is to San Antonio but obviously we have a very large military presence. At the present time we have two major military hospitals. One actually just closed recently, Wilford Hall, but BAMC is being plussed up, Wilford Hall will have a state-of-the-art ambulatory center, and we have a major VA hospital. The issue that comes up is of course can they still-- will they be able to communicate, the interoperability issue that comes up, the different guidelines and requirements that maybe a military hospital or a VA may be subjected to as opposed to the other hospitals in San Antonio because there is quite a bit of overlap, believe it or not, as far as patient care. Your thoughts on that? Dr. Blumenthal. We work very closely with the VA and DOD to help them achieve seamless interoperability between their local facilities. As a matter of fact, we prioritize some beacon communities where there were VA and DOD facilities that were trying to communicate because we wanted to support that activity. So one of the ways we are doing that is by developing software and standards that will work specifically to facilitate their interoperability so very much on our radar screen, Congressman, and we hope we can continue to help them and make this a reality because I know it is also of great concern to the President that our current servicemen and our veterans get integrated care that benefits from all the information that is available about them. Mr. Gonzalez. Well, thank you very much, and I yield back, Mr. Chairman. Mr. Pallone. Thank you. I want to thank both of you for your testimony and answering our questions. As I mentioned before, obviously some members have said they are going to follow up with written questions as well, but this is an issue that is hugely important to our hospitals and our providers, so thanks a lot really for---- Mr. Shimkus. Mr. Chairman, will you yield? Mr. Pallone. Sure. Mr. Shimkus. And I would hope that our first panel would follow the hearing record. On the second panel, we have seven folks on there. They are from small hospitals. They are from family practitioners. A lot of these questions that we have addressed come from them. I know you probably won't stay, but I would encourage you to get the hearing record and see some of the issues that have been raised in the second panel. Dr. Blumenthal. Absolutely. Mr. Pallone. I agree with Mr. Shimkus. Thank you very much. Dr. Blumenthal. Thank you. Mr. Trenkle. Thank you. Mr. Pallone. And I will ask the second panel to come forward. Now, we are expecting votes on the floor fairly quickly so I doubt we will get through all seven people that are on the panel but we are going to try to start and get as far as we can because there are seven of you, I believe. Well, first of all, let me welcome everyone. I know we have a large panel here. I am going to introduce each of you. Beginning on my left is Frank Vozos, Dr. Vozos, who is Executive Director of Monmouth Medical Center speaking on behalf of the New Jersey Hospital Association. Thank you for being here, Frank. Monmouth Medical Center is in my hometown of Long Branch, and I was actually born there. Next is Mr. Gregory Starnes, who is CEO of Fayette County Hospital. That is Fayette County, Georgia? Mr. Starnes. Illinois. Mr. Pallone. Fayette County, Illinois. OK. Sorry. And then we have Ms. Christine Bechtel, who is Vice President of the National Partnership for Women and Families; Dr. Roland Goertz, who is President-elect of the American Academy of Family Physicians and CEO and Executive Director of the Heart of Texas Community Health Center; Dr. Matthew Winkleman, who is a physician with the Primary Care Group in Harrisburg, Illinois; Dr. Glen E. Tullman, who is Chief Executive Office of Allscripts; and Dr. Peggy C. Evans, who is Director of the Washington and Idaho Regional Extension Center with Qualis Health. We ask each of you to limit your testimony to 5 minutes. You can certainly add additional testimony if you like and then you will get more written questions from us later, and I will start with Dr. Vozos. STATEMENTS OF FRANK J. VOZOS, M.D., FACS, EXECUTIVE DIRECTOR, MONMOUTH MEDICAL CENTER, ON BEHALF OF NEW JERSEY HOSPITAL ASSOCIATION; GREGORY D. STARNES, CEO, FAYETTE COUNTY HOSPITAL; CHRISTINE BECHTEL, VICE PRESIDENT, NATIONAL PARTNERSHIP FOR WOMEN AND FAMILIES; ROLAND A. GOERTZ, M.D., M.B.A., PRESIDENT- ELECT, AMERICAN ACADEMY OF FAMILY PHYSICIANS, CEO AND EXECUTIVE DIRECTOR, HEART OF TEXAS COMMUNITY HEALTH CENTER; MATTHEW WINKLEMAN, M.D., PHYSICIAN, PRIMARY CARE GROUP, HARRISBURG, ILLINOIS; GLEN E. TULLMAN, CHIEF EXECUTIVE OFFICER, ALLSCRIPTS; AND PEGGY C. EVANS, PH.D., CPHIT, DIRECTOR, WASHINGTON AND IDAHO REGIONAL EXTENSION CENTER, QUALIS HEALTH STATEMENT OF FRANK J. VOZOS Dr. Vozos. Good afternoon, Mr. Chairman, Ranking Member Shimkus and distinguished members of the committee. Thank you for inviting me to testify today. I am Dr. Frank Vozos, Executive Director of Monmouth Medical Center located in Long Branch, New Jersey. Monmouth Medical Center is a member of the San Barnabas Health Care System, the largest not-for-profit integrated health care delivery system in New Jersey and one of the largest in the Nation. I am also here on behalf of New Jersey Hospital Association. I am pleased to appear before you today to highlight how the HITECH Act will support the transformation of Monmouth Medical Center by helping us successfully fulfill our goals related to the acquisition and implementation of health information technology and to applaud the federal government for establishing a program that will provide incentive payments through Medicaid and Medicare to doctors and hospitals who demonstrate meaningful use of the certified EHR system. By way of background, Monmouth is a 527-bed community teaching hospital that provides a full spectrum of services from neonatology to geriatrics with more than 800 medical and dental staff members. The medical center admits more than 22,000 adult and pediatric patients and cares for over 120,000 outpatients annually. We are one of the largest and oldest teaching hospitals in New Jersey and we are the largest academic affiliate of Drexel University College of Medicine and that is a relationship that we have had for over 4 years. We are further distinguished among the landscape of health care providers in New Jersey by our relationship with the Long Branch federally qualified health center, which opened in April 2004 and grew directly out of Monmouth Medical Center's longtime motto of providing primary care to the community through charity care clinics. It is important to note that Monmouth is the leading health care provider in the city of Long Branch, a multi-ethnic enclave of residents who are disproportionately poor, young, uninsured and members of minority groups. More than 35 percent of the city's population lives at or below 200 percent of the federal poverty level. There are four census tracks with the city that have been federally designated as low-income, medically underserved populations, and although there are 40 primary care health care providers located in the area, most do not accept Medicaid or offer charity care. So as a result, the medically indigent population of Long Branch and its surrounding communities use the low-income clinics or our emergency room at Monmouth as their only source of health care. While Monmouth was moving fairly well down a path of HIT adoption before the passage of the HITECH Act, the new law certainly strengthens our ability to effectively transition to more comprehensive adoption. I think we have pursued this goal enthusiastically, embarking on a facility-wide effort to upgrade our health information technology capabilities on multiple fronts. As an example, in our emergency department we have invested significant resources to install many sophisticated information technology components including directing the interface between the emergency room clinical information system and hospital charts using the EDIMS computer framework. All records and tests are available of the care of the patient and it links to our medical center health information record. Repeating testing unnecessarily has declined and patient safety combined with more timely care has been the core outcome of this initiative. Monmouth Medical Center's clinical information system suite of products, which is current the Cerner Millennium, is currently CCHIT certified. These products adhere to requirements dealing with functionality, security and interoperability. On a regional level, we are one of the leaders in developing protocols and an infrastructure to share clinical data with four medical centers through Monmouth and Ocean County, and that is regardless of our competitive marketplace. One aspect of the new system we are very focused on is computerized physician order entry. We are dedicating significant time and effort to changing behavior of physicians to enter orders into the computer instead of handwriting them. In a teaching hospital, it becomes important to leverage that technology infrastructure such as CPOE as a teaching modality as well as a recordkeeping modality as the large resident staff interacts most frequently with the patients and completes written orders. Moving outward from our emergency department, the extent of EMR use is varied throughout the rest of the hospital. In the emergency department, EMR includes medication orders, lab results, radiology readings, history and physicals, nurse and physician notes as well as discharge instructions. On the floors, the EMR has lab results, radiology readings and other test results and other parts of the record are still handwritten, although with easy access. So it is part of our global IT initiative that all areas of the medical center will be EMR active by 2011. Further meaningful-use requirements with a compliance goal of 2011 at Monmouth include provisions for a physician to take advantage of EHR in their own private practice. Private physician offices and their style of practice are being taken into account as vendors are linked with these clinical partners to create the EMR interface with Monmouth. By 2011, there will be active physician connectivity with the hospital. Part of this deliberate strategy includes the costs associated with linking physicians and the medical center through EMR. What can be subsidized and what is funded by the medical center or physicians are important factors as we work through this connectivity goal. The ability to eliminate potential errors and medical errors including handwriting and timeliness of order gives clear quality markers for both private physician practice and care provided at Monmouth Medical Center. In addition, we were recently selected and are currently actively engaged as one of only two hospitals in New Jersey to begin a CMS-funded 21-month pilot project to test and model transitioning Medicaid patients who present to the emergency department with non-emergent care needs to the appropriate primary care setting through collaboration with our federally qualified health center. This data-driven pilot has further integrated electronic referral systems and electronic health records through infrastructure enhancements and a recommendation to the State and federal agencies administering and coordinating the pilot in New Jersey and in 19 other States. Currently, the FQHC clinicians can electronically access the hospital record for a previous hospital history and test results for their patient. By 2011, the new CPOE functionality will be fully interoperable between the emergency department and the Long Branch federally qualified health center, allowing for truly comprehensive EMR for our patients as well as CPOE for our physicians and other clinicians both in the medical center and private offices. Mr. Pallone. Frank, I am going to have to ask you to summarize the rest. Dr. Vozos. OK. I am done. I just want to let you know that for the patients in this pilot study, we have seen a 70 percent conversion rate from people that have been using the emergency room as their medical home now to the federally qualified health center as their primary care. So again, thank you for inviting me. I appreciate this opportunity to appear before you today and I will answer any questions. [The prepared statement of Dr. Vozos follows:] [GRAPHIC] [TIFF OMITTED] 78126A.037 [GRAPHIC] [TIFF OMITTED] 78126A.038 [GRAPHIC] [TIFF OMITTED] 78126A.039 [GRAPHIC] [TIFF OMITTED] 78126A.040 [GRAPHIC] [TIFF OMITTED] 78126A.041 [GRAPHIC] [TIFF OMITTED] 78126A.042 [GRAPHIC] [TIFF OMITTED] 78126A.043 Mr. Pallone. Thanks so much, really. Now, that was the bell. I think we can get at least two more in, maybe three, before we go vote. Mr. Starnes. STATEMENT OF GREGORY E. STARNES Mr. Starnes. Chairman Pallone, Ranking Member Shimkus and other distinguished members of the committee, thank you for this opportunity. My name is Greg Starnes and I am the Chief Executive Officer of Fayette County Hospital and Long Term Care in Vandalia, Illinois. I have been in health care administration my entire career, and I consider it an honor to be here today to talk with you about the HITECH Act. First, please know that my colleagues and I support the HITECH initiatives. Fayette County Hospital and Long Term I is a critical-access hospital with 25 beds and 85 long-term care beds. The facility serves a county of 21,000 people and resides in the county seat of Vandalia with a population of 7,000. The average household income is below the State average. The percentage of elderly in the population is higher than the State average. The unemployment rate is 10.8 percent. The number of Medicaid eligible has increased in the last year and the numbers of individuals who find themselves with no ability to pay for health care services have also risen. They represent the reality in today's rural health care environment and many parts of Illinois. The challenges I have faced during the last 18 months have been the most difficult of my career. In early 2009, my hospital began to feel the effects of the changing economy. July of each year has typically been the month during which I have been able to provide merit pay increases for my dedicated employees. In May of 2009, I informed my employees they would not be receiving any wage increases in July. The hospital finances did not improve in the ensuing months as a local employer with 140 employees relocated to another State. In early October 2009, I conducted numerous meetings with all employees to inform them that I was reducing the work hours by 5 hours per 2-week pay period, which represented a 5 percent decrease in their wages. My managers and I accepted a 10 percent reduction in our salaries. I reduced vacation accruals and temporarily halted the employees' 401(k) match and I eliminated several positions. We saved a great deal of month in the fourth quarter of 2009 yet we finished the year in the red with a net income of a negative $74,000. On January 1, I increased the managers' salaries 5 percent. Since that time there have been no hour or wage increases for anyone. The number of full-time-equivalent employees in September of 2009 was 225. The total now is 195. I represent only one example of many hospitals that have faced those same challenges, hospitals that are within the top three employers in the communities we serve. We are not just about health care in our communities, we are also about jobs. We are about jobs for nurses, nurse aids, physicians, lab and X-ray technicians, housekeepers, cooks, maintenance workers, therapists and so on, and of course, information technologists. In some of these jobs categories, there are shortages of qualified personnel. In all of these categories, these workers need the proper tools to do their jobs to the best of their abilities. CT scanners, MRI units, operating room equipment, ambulances, et cetera are hugely expensive. Software, hardware and training are extremely cost. To achieve the expectations of our patients along with those of the governing authorities requires a great deal of money. Awareness of this among our Congressmen and Congresswomen is vital as we endeavor to improve health care in America. There are 51 critical-access hospitals and another 15 rural hospitals in Illinois out of 200 plus total hospitals. All are taking steps toward meaningful-use criteria. At least 10 of the critical-access hospitals have less than 20 days cash on hand because of the impact of increased Medicaid and self-pay patients. A reasonable estimate would suggest that roughly half of the hospital have inpatient health information systems and two-thirds of them have lab and radiology systems. However, only 20 percent have physicians using computerized physician order entry. The new meaningful-use rule with allow other practitioners to enter orders into the system and that will help but it will also place additional burdens on the hospital staff. Thank you for your support of the changes in the final meaningful-use objectives. Some of them indeed lessen the burdens for critical-access hospitals to achieve those objectives. The loosening of the CPOE requirements as well as inclusion of critical-access hospitals for Medicaid incentives represent a very positive change from the original proposed guidelines. That said, the challenges our hospitals still face should not be underestimated. The capital necessary to procedure the software and hardware is still less accessible in today's economy than it was 12 to 18 months ago. In my case, the estimated cost for software and hardware necessary to achieve meaningful use will likely be close to $750,000. There will also be substantial costs associated with establishing interfaces to enable hospitals and providers systems to connect. An additional $50,000 to $100,000 will be necessary for training and process changes. So these numbers are large for my hospital and for many others. At this time my hospital needs a new CT scanner for a minimum of $350,000 because the one we currently have is 8 years old and increasingly unreliable. We also need to buy a digital mammography unit for approximately $350,000 so that women in the community can take advantage of up-to-date technology and so that unit can work with an electronic health records system. There are numerous other needs that are very expensive, and we all face challenges like that already, and I know that we face the acquisition implementation of EHR as well. I believe there may be rural hospitals that will not meet the imposed timeline under HITECH. Additionally, qualified health IT professionals are in high demand and the supply is currently a problem. So increased need for them in order for hospitals to achieve the IT requirements for EHR systems may present real-time and cost concerns. It is indeed fortunate that there are efforts underway to boost the health IT workforce through funding for community colleges. However, the boost might not materialize in time for hospitals to realize the currently structured incentives for meaningful use. Failure on the part of some hospitals to arrive at meaningful-use capabilities could jeopardize patient safety. It is my understanding that assistance to overcome these challenges will be available through the RECs, and I applaud that effort. However, I am concerned as we have seen through other federal offices and programs there will not be a sufficient focus on the challenges---- Mr. Pallone. Mr. Starnes, I am going to have to ask you to summarize the rest, too. Mr. Starnes. All right. Thank you. My colleagues and I truly want to offer patients the benefits of a fully functional electronic health record system. We understand the advantages it can have in reducing overall costs, duplication and errors while also improving accountability and patient safety. However, I also want this committee to understand that rural providers and patients face unique challenges. A recent survey exemplifies that only about 30 percent of the critical-access hospitals nationwide would quality for stage 1 incentives. Thank you for this opportunity to offer my testimony. I look forward to working with you to ensure that all hospitals, providers, urban and rural, realize the benefits of electronic health record systems. Thank you. [The prepared statement of Mr. Starnes follows:] [GRAPHIC] [TIFF OMITTED] 78126A.044 [GRAPHIC] [TIFF OMITTED] 78126A.045 [GRAPHIC] [TIFF OMITTED] 78126A.046 [GRAPHIC] [TIFF OMITTED] 78126A.047 Mr. Pallone. Thank you. We still have another 6\1/2\ minutes, so I am going to ask Ms. Bechtel to go and then we will break. STATEMENT OF CHRISTINE BECHTEL Ms. Bechtel. Good afternoon, Mr. Chairman, Congressman Shimkus, Congressman Gonzalez. Thank you for having me here with you today. I am Christine Bechtel and I am the Vice President of the National Partnership for Women and Families. We are a nonprofit consumer advocacy organization here in D.C., and I was also appointed as a consumer representative to the Federal Health IT Policy Committee. So I am honored to be with you today to discuss the ways in which meaningful use of information technology will benefit patients and their families. That said, our discussion today shouldn't actually be about technology. It should be about the ways in which changes in health care payment and delivery can create the kind of truly patient-centered system that we all envision and that every consumer deserves. That means designing systems around what patients say they want and need to improve their own health outcomes, and what patients want is simple and straightforward. They want their doctors to talk to each other. They want information about their conditions. They want providers to know them well enough to make treatment recommendations that actually make sense for them and they want their care team to have the information and support that they need to do the best job they can. Technology plays a critical role in delivering this kind of patient-centered care. It cannot be done right, done well or done consistently without interconnected health IT, and the regulations issued by the Administration on meaningful-use lay the groundwork for doing just that. I would like to highlight some of the ways that the meaningful-use program will result in tangible improvements for patients and families by sharing with you the story of Susan Crowson, who is a family caregiver from Maryland. Susan looks after her father, Pop, who has Alzheimer's disease, heart arrhythmia, prostate problems, low blood platelets and is susceptible to other infections. He sees a primary care physician, a cardiologist, a urologist, a hematologist and a neurologist. Each monitors and treats a separate problem and yet they don't talk to each other. So Susan had to build a spreadsheet to keep track of it all. She leaves copies with each doctor and asks that Pop's records be sent to his primary care physician and his other specialists, but it is rarely done. When she takes her dad for lab tests, she is the one who makes sure that each doctor gets the results or it just doesn't happen. Pop takes there prescription drugs, two over-the- counter drugs and vitamins as well as occasional antibiotic. These drugs are prescribed by different doctors. When his doctors prescribe a drug, they actually tell Susan to make sure that she checks with Pop's other doctors about potential drug interactions. Susan's situation is common. Millions of patients struggle to gather and update hundreds of pages of medical records if they can get them at all, toting them from doctor to doctor, knowing that no provider is likely to have their full medical history and test results. Mr. Chairman, I am confident that we can help Susan and other patients and families get better care by leveraging the requirements that are now part of the meaningful-use program. The new regulations are strong, sensible and patient-centered. If the members of Pop's team were meaningful users of EHR today, they would maintain up-to-date problem lists of his conditions and medications. They would check those lists for drug-drug interactions and allergies. They would provide Susan with education resources, summaries of care after every office visit, reminders about follow-up care and more, and his care team would also start to develop the ability to communicate with each other electronically. Stage 1 of meaningful use also builds the foundation for overall improvements in the quality, safety and efficiency of care. For example, it requires the collection of race, ethnicity, preferred language and gender data so that we can identify and target health disparities. It asks physician meaningful users regardless of specialty to focus on hypertension, smoking and obesity so that we can better address the public health challenges are driving the increase in chronic conditions and causing costs to skyrocket, and it advances an important set of criteria for protecting the privacy and security of health information. But our work on meaningful use is not done. Stage 2 should enable the robust, secure exchange of clinical information across all the providers in settings involved in the patient's care in compliance with federal and State privacy laws. Patients and families should have timely, ongoing access to their health information in a way that is portable so that they can assemble it in a secure place and quality measures should assess outcomes, functional status and patient and caregiver experiences. Put simply, future criteria should be driven by the goal of high-patient patient-centered care. It is what Susan deserves and what all patients deserve. After all, health care transformation is not about money and it is not about technology, it is about people and it is about leadership, and we thank you for yours. [The prepared statement of Ms. Bechtel follows:] [GRAPHIC] [TIFF OMITTED] 78126A.048 [GRAPHIC] [TIFF OMITTED] 78126A.049 [GRAPHIC] [TIFF OMITTED] 78126A.050 [GRAPHIC] [TIFF OMITTED] 78126A.051 [GRAPHIC] [TIFF OMITTED] 78126A.052 Mr. Pallone. Thank you. We have three votes which normally takes about half an hour, so we are going to recess and then we will come back and hear from the rest of you and then take questions, so the subcommittee now stands in recess. [Recess.] Mr. Pallone. The Subcommittee on Health will reconvene, and we left off with Ms. Bechtel, so Dr. Goertz, you are next. STATEMENT OF ROLAND A. GOERTZ Dr. Goertz. Thank you, Chairman Pallone and Ranking Member Shimkus and other members. As you said, I am Dr. Roland Goertz, President-elect of the American Academy of Family Physicians and I really am excited about the opportunity to give you our testimony. As a user of EHR for nearly 14 years, the CEO of a federally qualified health center that has won the HIMS award for EHR use, and a representative of 94,700 members of the AAFP, many in small- and medium-sized practices, I believe my perspective and the AAFP's will be useful, particularly as to how to implement HIT in small practices, how to serve diverse populations with its use and how the HITECH subsidies will help them. Nearly one in four of all office visits is made to family physicians. We provide more care to America's underserved and rural populations than any other medical specialty. Our commitment to improving patient care and clinical outcomes has long made us supporters of HIT. We believe that the recent meaningful-use regulations will support what the AAFP already has been doing for many years. Our focus has been to ensure that the meaningful-use rules are achievable by physicians in small- and medium-sized practices and also improve patient care. Our members want to accomplish what Congress intends. Fifty-nine percent of our members currently have electronic health records but their use of it varies greatly. We need to help the rest purchase IT, encourage those who have it to become more comprehensive users of it and have all begin to use it more effectively. We ask that your committee ensure that the first rounds of reporting and incentives from CMS be both consistent and reliable. Let me talk briefly about my FQHC's experience with HIT. The mission of FQHCs is to provide health care to those under 200 percent of poverty, which includes Medicaid patients and those who are dual eligible. Our center serves almost 50,000 people in the Waco-McClellan County area of Texas. That is about 18 percent of the total population of the county. Our center has 13 sites, two of which are in rural communities. I am absolutely convinced that our use of EHR has led to improved patient care and efficiencies. Fourteen years ago, a number of our physicians were uncomfortable with computers. Indeed, some even got cold, clammy, sweaty hands when they came close to a keyboard. We also are in a rural area, which is more challenging for physicians using EHRs. Today, not one of our providers would return to paper records. Let me make two general observations about adoption of HIT. One, physicians coming out of residency today expect to use HIT and do so almost automatically. The issue of adoption is a generational one and will resolve over time. However, we are in the middle of a significant health care transition and must assist all physicians by supporting the regional extension programs, beacon communities, medical-home pilots and dissemination of best practices. Two, small, solo, rural practices in particular are short of time and dollars. They are busy focusing on patient care and operating on small margins. Assisting them is critical to making HIT work in the United States. As an example, if your office has a major computer problem, you have an outside support team to analyze and fix the problem. I think of the regional extension centers as a comprehensive support team for small practices. These centers will provide not only technical assistance but general information when these small practices need help. Therefore, we ask you to closely monitor the implementation and resources of the regional extension program because they are essential to success of these practices. We strongly support the HITECH Act incentives. These investments are staged and crucial to improve quality and cost- effectiveness of patient care. FQHCs also will need similar support. Let me conclude by restating three points. Number one, HIT is critical to improving quality and effectiveness of patient care; number two, physicians in small rural practices must receive effective technical support during implementation and use of HIT; and number three, the HITECH grants are crucial as physicians make these transformative changes to their practice. I thank you again, and I am personally excited about the potential for improving patient care that the tools of HIT offer us. [The prepared statement of Dr. Goertz follows:] [GRAPHIC] [TIFF OMITTED] 78126A.053 [GRAPHIC] [TIFF OMITTED] 78126A.054 [GRAPHIC] [TIFF OMITTED] 78126A.055 [GRAPHIC] [TIFF OMITTED] 78126A.056 [GRAPHIC] [TIFF OMITTED] 78126A.057 [GRAPHIC] [TIFF OMITTED] 78126A.058 [GRAPHIC] [TIFF OMITTED] 78126A.059 Ms. Schakowsky. [Presiding] Thank you, Goertz. Dr. Winkleman. STATEMENT OF MATTHEW WINKLEMAN Dr. Winkleman. Chairman Pallone, Ranking Member Shimkus and Congressman Gonzalez, let me begin by thanking you for the opportunity to provide testimony today. My name is Matt Winkleman. I am a family physician practicing in Harrisburg, Illinois. Our community is in rural southern Illinois and has a population of about 10,000. I practice full time and I am one of the owners of Primary Care Group in Harrisburg where we serve patients not only from Harrisburg but from several surrounding communities and rural counties. Our practice is a rural health clinic that includes eight primary care doctors, five mid-level providers and a general surgeon. In total, the clinic employs around 50 people. I am honored to share with you today our experience with an electronic health record and a little bit about it impacts our practice and the care we provide to our patients. One of the obstacles many physicians cite in the decision to employ an electronic record is the initial upfront cost. Not only is the software, hardware and necessary infrastructure costly but the process of seeing patients at least in the initial weeks of transitioning requires changes in work flow that will likely decrease efficiency and the number of patients seen. As you are all aware, under our current reimbursement system, fewer patients means less added to the bottom line, and as a result, many physicians calculate they cannot afford the initial financial investment. This is especially true for physicians like myself who practice in rural areas where the average payer mix includes minimum commercial insurance and where profit margins may already be thin. Thankfully, the HITECH bill is going to help physicians address many of the challenges and begin reaping the benefits of electronic health records. The approach taken within the legislation to reward utilization and not just purchase was smart. The regional extension centers will be immensely useful to small practices without the know-how to feel comfortable moving to an EHR on their own and the funds going to develop broadband networks and other infrastructure will be crucial in eventually allowing us to exchange clinical information. The benefits of EHR use, as I said, are significant. At a time of great uncertainty within the general health care industry, at least one thing seems clear to me: technology will have a role in helping us provide the kind of high-quality, safe, efficient care our patients deserve. On nearly a daily basis, my EHR helps me avoid prescribing a medication to a patient because they have an allergy to it, allows me to print out materials for patients to help them understand their diagnosis and reminds me to order a mammogram on a 55-year-old patient who came in only for a sore throat. It is not uncommon for me to see patients struggling to manage six to eight medications, caring for three to four chronic diseases. Medicine is complex, and the reality is that even the most astute of clinicians can benefit from the safety checks provided by an electronic health record. Furthermore, while the individual patient benefits from the improved safety that stems from use of an EHR, my practice has begun to see the benefits to the population as a whole. With the use of our EHR, we were recently able to generate a report of all the diabetic patients from the practice's census who had not received appropriate follow-up and proactively schedule an office visit to get them back in, giving them a much greater chance of avoiding the costly complications that can result from diabetes. Additionally, after the recently controversy surrounding the diabetes drug Avandia, we were able to generate a list of all of our patients receiving this medication within a matter of only minutes. These types of things would have been nearly impossible with a paper system. It is also important to keep in mind, however, that all of these things I am describing would have been just as impossible if the information in our EHR such as lab data and medication history were not included as discrete structured elements in a database. Had they been scanned copies of paper reports, the information may as well have been in a paper chart. There must be standards in place which foster the use of technology in such a way that it truly benefits patients and provides the most value to the physicians when they are making care decisions. For this reason, while I am not generally an advocate of large-scale government involvement and government management of health care, I do think this is an area where focused guidance steering the medical community is absolutely needed. In summary, as a rural family physician practicing with an electronic health record, I have seen the benefit they can provide by helping improve safety, increase compliance with recommended preventative care and proactively manage chronic diseases. My practice is located in a county ranked by a recent Robert Wood Johnson Foundation study as 98th out of 101 in Illinois with regard to the health of its population and many of the neighboring counties were also near the bottom of that list. I am optimized that the meaningful-use incentives and the work of the regional extension centers can help providers in rural areas like Harrisburg to begin not only to take advantage of health information technology but recognize it as another instrumental tool in the pocket of their white coats. I am excited about what the future holds and look forward to the next steps in the process as we move even further forward in connecting providers to allow the exchange of health information. Thank you for the opportunity to provide testimony today. [The prepared statement of Dr. Winkleman follows:] [GRAPHIC] [TIFF OMITTED] 78126A.060 [GRAPHIC] [TIFF OMITTED] 78126A.061 [GRAPHIC] [TIFF OMITTED] 78126A.062 Mr. Pallone. Thank you, Dr. Winkleman. Dr. Tullman. STATEMENT OF GLEN E. TULLMAN Mr. Tullman. Actually I am not a doctor. Mr. Pallone. Mr. Tullman, CEO Tullman. Mr. Tullman. Chairman Pallone, Ranking Member Shimkus and other distinguished members of the committee, thank for the opportunity to testify today. My name is Glen Tullman and I serve as the Chief Executive Officer of Allscripts. Allscripts is the largest provider of electronic health records, electronic prescribing, practice management software and other software that helps physicians manage their patients. More than 160,000 physicians, which is one-third of all practicing physicians outside the four walls of the hospital, use Allscripts software along with 800 hospitals and over 10,000 other health care providers in post-acute care facilities and home care agencies to manage their patients. Allscripts solutions automate daily activities and connect their clinical and business operations. It is now 17 months since the passage of the American Recovery and Reinvestment Act and it is clear that health care information technology as an industry is forever changed. It is my belief that we are at the beginning of the single fastest transformation of a major industry in the history of our country. Congress and the Administration in a sign of true leadership have provided an investment in technology that will lead to the delivery of better care for all Americans, improve patient safety and deliver significant savings due to efficiency. I speak to hundreds of health care professionals every month across the entire spectrum of care and it is clear from them that the meaningful-use incentives in the stimulus package are an essential component of the sea change that health care is undergoing and that will benefit all of us today. However, understanding how the stimulus and meaningful use applies to our clients and how to implement an electronic health record can be challenging. This is especially true because our clients span the entire continuum of care from single physician primary care practices and rural geographies to federally qualified health centers to the largest and most prestigious academic medical centers in the country. Allscripts have committed extensive resources over the past 17 months to educating all of these groups, not just our clients, about meaningful-use incentives. We have hosted hundreds of free educational sessions across the country and webcasted many more, and in 2 weeks since the release of the final rules on July 13th, we have already provided educational content to thousands of webcast attendees. We expect our educational efforts to continue as we work closely with regional extension centers in the coming months and years. The HITECH incentives had a measurable stimulative effort on our business in three ways. First, inquiries about our electronic health records have been at record levels since the initial passage of ARRA. Second, we have increased our annual R&D expenditures a full 25 percent from $72 million to $90 million, which will help drive innovation into the industry. And third, we have hired more than 560 people since the passing of ARRA with plans to hire several hundred more in the next year. These are high-paying technology-centered jobs, just the kind of jobs that the American workforce needs. Even more importantly, our clients are also hiring directly as they work to ensure success in their health care IT adoption efforts. For example, Denver-based Catholic Health Care Initiatives, in part spurred by the meaningful-use incentive program, has announced that they will be hiring 200 health IT professionals over the next year, and we have many other clients with similar plans. So if you had any questions, the health care incentive stimulus plan is working in our industry. Now, the final rule is out and hospitals and health care organizations among our client base are very pleased. The uncertainty about meaningful use has been removed and many of the changes that the provider community requested during the comment period were in fact incorporated. This process was a positive example of a productive public-private partnership. Many physicians particularly appreciated the flexibility related to what constitutes meaningful. You have created real incentive and real momentum with meaningful and with health care reform efforts. Now I would encourage you to take three steps to build on that success. First, push vendors like Allscripts and providers to achieve even higher standards related to more-robust connectivity. All systems should be able to connect and accept data from outside systems as if it were their own by using common standards as the banking industry does today. Second, it is time to mandate electronic prescribing. This is a patient safety issue and one we believe we can address. And finally, let us continue to focus on performance metrics and use payment and delivery system reforms to reward physicians who demonstrate positive outcomes for their patients. In summary, the final rule on meaningful use will result not only in a higher number of providers participating in the incentive program but more importantly higher quality and safer care for patients. We expect most providers not only to meet but to exceed the requirements of meaningful use, which we call meaningful value, by doing more than the minimum. We have key clients across the country who are doing just that. For example, the University of South Florida and Wellspan in Pennsylvania are both using electronic health records to deliver better diabetes care and better inform patients. Sharp Healthcare in San Diego is approaching 90 percent electronic orders. Heritage Valley Health System in Pittsburgh is writing 100 percent of their prescriptions electronically and there are a host of others who are leading the way. We also see leaders like North Shore Long Island Jewish, Hartford Hospital and the University of Massachusetts, who are leading the way by connecting their communities for better care with the goal of one patient record. Your actions have served to both encourage and accelerate all of these activities and to spur other organizations to take similar actions. As the technology becomes part of the regular work flow and electronic health records provide critical information, we will see that meaningful use is essentially a jumping-off point, ultimately resulting in the connected system of health that we are all working towards. Thank you for all of your efforts and the opportunity to testify today, and I would be happy along with the panel to answer your questions. Thank you. [The prepared statement of Mr. Tullman follows:] [GRAPHIC] [TIFF OMITTED] 78126A.063 [GRAPHIC] [TIFF OMITTED] 78126A.064 [GRAPHIC] [TIFF OMITTED] 78126A.065 [GRAPHIC] [TIFF OMITTED] 78126A.066 Mr. Pallone. Thank you, Mr. Tullman. Dr. Evans. STATEMENT OF PEGGY C. EVANS Ms. Evans. Thank you. Good afternoon, Mr. Chairman and members of the subcommittee, thank you for inviting me here today. I am Peggy Evans, Director of WIREC, the Washington and Idaho Regional Extension Center for Health Information Technology. I represent Qualis Health, a private not-for-profit health care consulting firm and a Medicare quality improvement organization for the States of Washington and Idaho. I am honored to be here today to tell you about how WIREC will provide vendor-neutral EHR adoption services to help health care providers attain meaningful. Providers often start their EHR adoption believing that once the technology has been installed, they are at the end of their EHR implementation journey. In fact, once implementation has occurred, the journey has just begun. Technology is a great tool when it works well, but no matter how well it works, it is just a tool. Training people to utilize their technology is an essential component of successful EHR adoption. Our initial experience working with providers strongly indicates that there is a need for EHR technical assistance service through the REC program. For example, there is a community health center in the readiness planning stage of EHR adoption. They received a bid from a commercial, that is a non- REC, consultant for services at $225 an hour for a total bill of $45 million. The cost of a commercial consultant was prohibitively expensive for a community health center and they enrolled in WIREC, thus saving $45,000 for support of patient care and other administrative needs. Another story is that at our first site with another small clinic, we learned that the practice had not considered designating a project manager for their EHR implementation with only six weeks until their go-live date. While EHR vendors help providers with a bulk of their implementation and technology needs, providers often need to understand that there are tasks on their end that should be completed in order to help them help themselves, which is where WIREC steps in. WIREC's program strategy is threefold. First, we provide on-the-ground health IT coaches that deliver one-on-one customized technical assistance to providers. Second, we establish and maintain network IT communities of practice to share learning. For example, we have implemented an EHR regional group purchase committee with an independent consultant who is facilitating the process and committee members supporting the work. Third, we plan to support peer-to- peer networking activities that will allow participating providers to learn from one another, a very powerful method of communication. Our WIREC staff delivers a suite of services to providers across the three stages of the EHR adoption continuum: selection, go live and optimization. For providers in all stages, we disseminate information about the CMS incentive payments, help providers understand the meaningful- use criteria within a framework for reaching that level of EHR use and provide assistance in workflow evaluation and redesign. The importance of workflow redesign cannot be stressed enough. Many providers are under the assumption that they will transition from paper to EHRs but continue to use the same workflow processes that supported their paper-based records, but if they do that, they are unlikely to succeed with their EHR adoption. Health IT professionals and researchers have shown time and time again that workflow redesign is critical for successful EHR implementation and that it is not business as usual. Recognizing that providers in our region may have already adopted a multitude of EHR systems as a starting point toward meaningful use, WIREC offers vendor-neutral services and will work with providers regardless of their choice in EHR systems. Among the first several hundred providers who have enrolled with WIREC, they are currently 14 different EHR products already in use which hopefully you can see displayed on the screen. There you go. I won't take the time to read them all but you can see that there is a wide variety of EHRs that we currently support. Because one of WIREC's major objectives is to assist providers in meaningfully using their EHR systems, our consultants help identify the gaps between where the provider is now and where he or she needs to be in order to reach meaningful use. We then lay out a customized path for how to achieve meaningful use. We have received feedback from many providers that the meaningful-use criteria just seem like a long list of unorganized requirements. WIREC staff provides a framework for organizing the criteria in a way that is more readily digestible by providers and their staff and then suggest doable chunks that providers can tackle without being overwhelmed. To date, we have successfully enrolled practices that represent about 500 primary care providers as indicated on the map. Among our initial enrollees, there is a distribution of practice locations across the two-State region that includes both urban and rural sites. The REC program focuses on smaller provider offices, community health centers, rural health clinics and other ambulatory practices affiliated with the critical-access hospitals and rural hospitals and providers that primarily treat the underserved and uninsured. As you can see on the display graph, a vast majority of our enrolled providers are from smaller practices. Of the larger practices that we are serving, mostly all are community health centers or rural health clinics. The WIREC consulting team has now begun providing educational programs and direct assistance in the field to our participating practices. Initial survey results suggest that providers find REC services to be valuable. As you see on the display screen, among our practice sites thus far, 100 percent of the providers have reported satisfaction with WIREC services. The number of practices surveyed thus far is small but the results are encouraging. Additionally, our educational webinar series for providers has been well received with evaluation responses showing consistent ratings around 90 percent of respondents agreeing that each of the sessions has been a value as indicated again on the display. In conclusion, Qualis Health's startup experiences show that providers across our region, both urban and rural, are enrolling into the WIREC program and initial feedback from providers shows that they are finding value in working with the REC program as a supplement to the support that they may receive from their EHR technology vendor. Implementing an EHR system and moving toward meaningful use is a transformation far beyond the technical aspects of implemented a computer system. WIREC looks forward to helping providers embark on that transformation through our vendor-neutral support. Thank you again for the opportunity to share our experiences. [The prepared statement of Ms. Evans follows:] [GRAPHIC] [TIFF OMITTED] 78126A.067 [GRAPHIC] [TIFF OMITTED] 78126A.068 [GRAPHIC] [TIFF OMITTED] 78126A.069 [GRAPHIC] [TIFF OMITTED] 78126A.070 [GRAPHIC] [TIFF OMITTED] 78126A.071 [GRAPHIC] [TIFF OMITTED] 78126A.072 [GRAPHIC] [TIFF OMITTED] 78126A.073 [GRAPHIC] [TIFF OMITTED] 78126A.074 [GRAPHIC] [TIFF OMITTED] 78126A.075 [GRAPHIC] [TIFF OMITTED] 78126A.076 [GRAPHIC] [TIFF OMITTED] 78126A.077 [GRAPHIC] [TIFF OMITTED] 78126A.078 [GRAPHIC] [TIFF OMITTED] 78126A.079 Mr. Pallone. Thank you, Dr. Evans. We are going to take questions now, and if we don't have votes, we will do two rounds. I just don't know when the votes are coming to come. I will start with myself for 5 minutes. I want to start with Dr. Vozos. One of the most important functions of health IT is to connect a patient's doctor and hospitals together across a patient's illness, and EHR could follow a patient from an outpatient clinic to the hospital, back home again, facilitating communications and care along the way, and of course, I am following up on my visit to Monmouth Medical Center where we discussed this. You describe how Monmouth is integrating its health records across settings including with your affiliated federally qualified health clinics. Just tell us more about how that project is progressing, and I of course witnessed part of it when I was there a few weeks ago. Dr. Vozos. Our health system, as you know, was developed really back in 2004, April 2004, and the reason we put it together was that though we had a lot of clinics, you know, we saw that the long-term evolution of those clinics was going to be a continuing loss of money and plus we had declining of services to the community in our area there. So converting that to a federally qualified health center and also with the reimbursement that was available to a federally qualified health center, you know, really kind of saved it, not only saved it, actually grew it to where it is probably one of the premier health providers in the area. In fact, it provides pretty good competition to private practitioners. Mr. Pallone. I used an example about one day when I visited and there was a guy sitting there in a business suit, which I thought was unusual, but may not anymore. Dr. Vozos. Well, what is a little bit unique about this particular FQHC is that it was necessary that we incorporate our teaching programs into the FQHC because the clinics, as everybody knows, are a major source of teaching for residency programs so we did incorporate them in, so our faculty actually are doctors in the clinic and the residents are also there. So it is a little bit unique, maybe not quite as efficient as Dr. Winkleman's FQHC or, I mean, Dr. Goertz's FQHC, but it is an excellent source of care. So it has grown tremendously. Mr. Pallone. How does the HIT fit in with---- Dr. Vozos. What we did was initially we connected them. It is a one-way connection right now from the FQHC into our hospital, meaning that they can access all the record of the patients that are in our hospital that they see in the clinic, and as you could imagine, most of the patients in that clinic when they do need to come to the hospital, they use Monmouth Medical Center or the Monmouth emergency room. So the physicians of the FQHC have direct access through the Internet into our---- Mr. Pallone. But wasn't there also something where if you went to the emergency room and they thought that you could use the services of the community health center, that they set up an appointment or something for you, right? Dr. Vozos. Well, that is our other pilot program where, you know, under a grant we---- Mr. Pallone. This is the demonstration program? Dr. Vozos. Right. Mr. Pallone. That was my second question. Dr. Vozos. Yes, and that program, what the pilot was to take all the patients who really were using our emergency room as their medical home, so to speak, identified those that really needed to have a primary care provider and arranged for them to be followed up in our federally qualified center. We thought initially we could easily make that happen once but we were kind of curious as to what the true conversion was going to be where they were not going to use the FQHC as their private, you know, physician office. There has been a 70 percent conversion. It has been really a tremendous success, and what it has done is, it has decompressed the emergency room, improved the throughput for the emergency room and really unclogged our emergency room and created a whole--a much better atmosphere even in our emergency room. Mr. Pallone. But it also made it possible for the people that have regular care so they didn't---- Dr. Vozos. Well, they now have---- Mr. Pallone [continuing]. End up just using the emergency room. Dr. Vozos [continuing]. A regular physician in the FQHC. Mr. Pallone. Now, is there also a Medicare demonstration program that looked at whether gain sharing between hospitals and physicians can reduce cost? Dr. Vozos. Right. Mr. Pallone. And then there was an electronic health records component of that too? Dr. Vozos. Yes, there is. We are part of a Medicare demonstration project, which is 12 hospitals in New Jersey, where we put together a set of criteria with the coordination of the New Jersey Hospital Association, a set of criteria to measure quality care, and if in the performance of these measures there was a savings of money, you know, the federal government has kind of relaxed itself a little bit and allowed us to share in those cost savings. So we have recently gone through the first phase of that where there was not only the signing up of physicians but we completed the first 6 months of measuring data, and what we are looking at right now is length of stay, complications, mortality rates and readmission rates, and there was--we actually issued the first set of checks and now we are going through the second phase of additional enrollment because initially not everybody wanted to enroll. They either didn't trust the project, they didn't want to have their name in some file that the federal government could be steering. There is all kind of reasons why doctors wouldn't sign up. But after the first phase of this, not we have had about three times the number of physicians signing up. So we are going to be well over 200,000 physicians signed up for this, and it has actually produced savings. Mr. Pallone. All right. Thanks. Mr. Shimkus. Mr. Shimkus. Thank you, Mr. Chairman. I have been writing and scratching notes all over the place, so this may get really disjointed, which would be very similar to most of my questions that I ask. But it has been very educational. I am a very outspoken critic of the stimulus bill but obviously we can se some future benefits down the line in this provision. My first question is, all of the examples of health care information technology that is being used now, how many have been deployed based upon stimulus dollars? I mean, there are a lot of examples of health information technology that have been talked about. Mr. Tullman, you sell it. Dr. Winkleman, you are using it. Dr. Vozos, you are using it. How much of that deployment was based upon taxpayer dollars? Dr. Vozos. I would say at Monmouth the upgrade to the Cerner Millennium---- Mr. Shimkus. Let us talk about stimulus dollars. Dr. Vozos. Right. I mean, we need to do that in order to be able to qualify at any point for the stimulus dollars. Mr. Shimkus. So your upgrade was, but your original deployment was not? Dr. Vozos. No, original deployment was Cerner. Mr. Shimkus. And Dr. Winkleman, I know that none of yours was done based upon--your practice made the decision on their own and incurred the capital expense and assumed the risk. Dr. Winkleman. Yes. I mean, our practice made the decision to move forward with this several years ago before there was discussion of money available. Mr. Shimkus. OK. I just want to put that--I mean, it is an important thing to be placed on the record. Again, no one is argue that is not beneficial and that we shouldn't be all in but I also want to point out that a lot of the examples being used are people who have done it without government help and government intervention. I want to go to the--again, Mr. Tullman, we understand how this really does benefit your business plan and your ability to hire a lot of folks because there is a new market being generated by this government push, which we hope will provide savings and better recordkeeping and hopefully lower medical liability costs based upon all those benefits. But Mr. Starnes from my district, in your opening statement you made some compelling arguments about the crisis in rural America of operating a small rural hospital. Can you incur these costs and provide the continued service? Mr. Starnes. Well, the economic downturn did play a very devastating role for us, so we have had to make lots of changes in order to rebound from that. What we find and what I was commenting about was we do have several capital needs, you know, diagnostic equipment---- Mr. Shimkus. And you would put those above HIT? Mr. Starnes. If I have a person come into the emergency room and need a CAT scan, I need a reliable CAT scan machine in order to provide that service, so I have got to put that just ahead of EHR at this point. Mr. Shimkus. Right, and that does segue into kind of Dr. Evans' point because I think your testimony mentioned about how you can be in essence a low-cost consultant for small rural hospitals and practitioners but you are paid on the government dole, you are not a private consultant that is for profit, paying taxes, paying for the office space, paying properly taxes and other issues because you are part of this government payout that we are doing, but I am not going to argue with the help but there is probably some computer consultants who now, you are the lowest bidder on providing, you know, consulting services and so they are probably going to Mr. Tullman trying to find a job over in his sector. Let me--my time is short. For the two hospitals here, the CMS actuary stated that about 15 percent of Part A providers would become unprofitable within 10 years based upon the new health care law because of lower payments, and the new health care law cuts $500 billion from Medicare. Dr. Vozos, are you going to be one of those 15 percent? Dr. Vozos. If that it all that occurs, yes. Mr. Shimkus. You would be? Dr. Vozos. Of course I would be. Mr. Shimkus. You are a major---- Dr. Vozos. I am a major teaching hospital but I am going to rely on those 32 million or the 1.3 million people in New Jersey who now have insurance to cover that reduction in Medicare reimbursement. I have to rely on that. Mr. Shimkus. Well, we can talk about that later on. And Mr. Starnes, kind of the same question. I am shocked. I thought you would be saying I can survive it because we are big. Now Mr. Starnes. Mr. Starnes. Under the critical-access hospital designation, then hopefully we will be fine, but it is not going to be easy for sure. We will have to be lean from---- Mr. Shimkus. You are already lean. You already can't provide needed capital equipment to your hospital. Mr. Starnes. Right. Yes. Mr. Shimkus. Mr. Chairman, my time is expired and I will yield back. Mr. Pallone. Mr. Gonzalez. Mr. Gonzalez. Thank you very much, Mr. Chairman. My first question, and it may have been covered in the absence with the other witnesses and it would have been appropriate for them, but it is a situation that in San Antonio the hospitals have made me aware of, and I want to make sure that I frame the question, that is that the Medicare incentives to grantees would be based on a CMS provider number if you have multiple campuses, so if there is anyone on the panel can explain the consequences of having one Medicare number but having more than one campus as far as the incentives and how that would be paid. I don't know if Doctor, is it Vozos? Dr. Vozos. Yes. I mean, it doesn't affect us because we have our own Medicare provider number but I can explain to you how it works. You know, there are hospital systems, let us say, five hospitals within one system all operating under one provider number so therefore they are going to get the stimulus once, not for each of the five hospitals. So theoretically some of the smaller or more rural hospitals in that system on a standalone basis would never be able to probably go through all this. Mr. Gonzalez. Anyone else have an opinion on the problems that that may present? Mr. Starnes. We just have the one campus and so it really doesn't apply for us, but I can imagine that it is going to be devastating for hospitals with several campuses because each facility is going to have its own separate staff to be trained and all of those costs that they will incur. Mr. Gonzalez. I understand a rural setting is totally different from what I have described, and Mister--let us see. Where is--well, it is Dr. Winkleman. I apologize. Mr. Shimkus has touched on the cost and how we would go about assisting. We know about the stimulus money but of course that is finite and such, but prospectively, as a physician, how is someone's practice going to afford the technology and the training? We introduced a bill a couple of years ago and it was a bipartisan bill. It was never passed, but we had everything in there. But I want your opinion, anyone on this panel that could give me an opinion as to the best way to assist the physicians to make that transition. We could have grants, a combination of grants. We could have low-interest loans, guaranteed, or tax credits or tax incentives. Is there any way that we should rank those or just have them all available? Anybody? Dr. Winkleman. Well, I think that having money and grants available to help physicians use electronic records is a positive thing but ultimately I think even better than that is that physicians begin to get paid for doing a good job and that as we start to--that our practice gets transformed by things like electronic health records, that industry will be motivated to make a product that works well, they will be motivated to make a product that produces better care, I am going to be motivated to use that product to provide better care, not just intuitively for my patients but because I am rewarded for it. So I think creating an environment where we are encouraged to use things like this to improve the quality helps make that transition make financial sense to a doctor because when you look at it on paper, sometimes it is a tough sell. There is a lot of upfront capital cost. There is initial reductions in productivity. On the long term, there are gains. I think a lot of practices become more efficient. They certainly do a better job of billing and coding to get paid for what they actually do. So I think one of the ways to do it is to make them make financial sense, and part of that would involve creating a situation where our reimbursement is tied to us doing a good job, not just seeing a volume of patients. Mr. Gonzalez. I think that is built in as far as the incentives and how we proceed with that and do it right. Of course, any time you have some positive reinforcement or reward or whatever you want to call it that encourages that behavior, there is another way of doing that, and that is obviously you are penalized for not adopting, for not being more efficient in the use of the technology, so there is all sorts of different angles. Of course, we would like to do it in a positive mode, and I appreciate your testimony today and I yield back, Mr. Chairman. Mr. Pallone. Thank you. I am going to have a second round for anyone who would like to participate, and I will start with myself. I am going to go back to Dr. Vozos, but I guess any of you could answer it. When I was--I mean, we asked many of you to come here today because we knew that you were being innovative with HIT, you know, before we passed the Recovery Act and we put in this legislation that we have been discussing. I mean, the idea at least in my mind was to hear from those who have sort of been the precursors and did this before there was any money from the federal government through the Recovery Act. But I would like to know, because I know when I went to Monmouth Medical Center that even though we discussed all the things that we are doing, you also discussed with me what you could do if you were able to tap the funds under this legislation. So maybe you should talk to me a little bit about where you would go from here, assuming you participated in this program. Dr. Vozos. I mean, we are on the road and we are making a lot of moves but we are far from there, and it is going to be a tough journey and an expensive one, so really funding for us it going to be a big issue going forward. You know, for Monmouth Medical Center the full-blown HIT system is going to be about $19 million over some period of time, and when I listened to Mr. Starnes talk, I said I want to go find out where you are buying that one, that $750,000 one. So it is a $19 million project for our system. It is just shy of $100 million. So as you can imagine, there needs to be all type of incentives to be able to spend that kind of money. Now, there is the return on investment so I would say right now, you know, we are moving forward on a regular basis. We still have to install more modules into our system to be able to get to the level where we are fully operable to even qualify for the stimulus money and that is what we are doing right now. So it will change the practice at the hospital for sure. I mean, it will change even how testing is done and what the residents are learning and the efficiency of the hospital but we have a road to go, but there is a bit team working on it and continues to work on it. And our big thing is linking the physicians and private practices and private offices and having a two-way exchange of information. We want to be able for them to populate the record in the hospital from what they're doing in the office but at the same time what is happening with their patients in the office should be able to go the opposite direction back into their office records too, so that is why we view as very important to have very compatible EMRs in the physician office and at the hospital with the appropriate interfaces set up, and we are putting a lot of effort into doing that. Mr. Pallone. Maybe I will go to Mr. Tullman because Dr. Vozos gives me the analysis from the hospital, but what about you in terms of your systems? I think I said in my opening statement that currently less than 20 percent of hospitals and 10 percent of physicians are using electronic health records, and CMS is saying that they are going to go to 95 to 100 percent of hospitals and 70 percent of physicians. How are you going to get there? Are you prepared, and what are the pitfalls? Mr. Tullman. I think it is a good question. What we have seen, and you recognized that this panel includes a number of innovators who have taken those steps, and I commend Dr. Winkleman and the other physicians and members of the panel for taking those first steps, but in technology adoption generally you get the first 20 percent are early adopters. The next 70 percent are where the real dollars and the benefits are and they take longer, and so the incentive program that you have put into place will help us get the next 70 percent and drive that throughout the rest of the market. From our perspective, we believe we are ready. We are investing heavily in making sure that the systems are easier to use, more easily deployed, and again produce the kind of measurable results that we need in health care, and I think the RECs, the regional extension centers, the other programs that have been designed are going to help us move that along. There are tremendous employment opportunities. There is tremendous work to do, and that is not just from the vendors, that is from actually the medical centers across the country. You know, the one thing I would say in terms of a recommendation that we were asked about before is, I think there is an opportunity to open the program even further to rural providers who in some cases are excluded because they are not off the same revenue schedules and to certain other programs like Medicare Advantage where some of our leading clients like Sharp Healthcare in California in fact have problems in terms of getting their physicians covered to use that, and they cover a significant amount, but overall, we think we are ready and we think the country is ready for better health care. Mr. Pallone. All right. Thank you, Mr. Tullman. Mr. Shimkus. Mr. Shimkus. Thank you, Mr. Chairman. Mr. Starnes, do you know, what is your closest REC? do you know it? Mr. Starnes. It is Northern Illinois University. Mr. Shimkus. And that is located where? DeKalb? Mr. Starnes. Yes. Mr. Shimkus. And how far is DeKalb from Vandalia? Mr. Starnes. I couldn't tell you. Somebody else? Mr. Shimkus. Four and a half, five hours. Mr. Starnes. OK. Mr. Shimkus. I know Idaho-Washington is a big area too, so, I mean, it is just a point I wanted to raise. If we follow up on the chairman's point, Mr. Tullman, about trying to get those numbers of 75 percent to 90 percent, that is really a rush for obviously a population that you and the other 12, 15 providers--Dr. Evans, you had that list up, I don't know how many there were, 12, 15 providers who provide the same type of services as Mr. Tullman. Are we concerned that they will go to the bigger institutions prior to the smaller ones? Mr. Tullman. We really--I will take the first shot at that. We believe and what we are seeing is accelerated adoption across the board, so we know that at least until the stimulus package, the larger organizations were in fact advantages because they had CIOs, they had a capital budget and the like. What the stimulus program does it open it up so smaller physician groups and offices and independent physicians can do that. That is number one. Number two, a lot of the larger organizations, for example, I mentioned North Shore Long Island Jewish, what they have done is, they not only bought licenses for their 1,200 employed physicians but they have actually extended that offer to 7,000 affiliated physicians in the community to help connect them up and bring those benefits. The last point is that many of the vendors have come out with innovative programs like a financing program with no payments for 6 months to help bridge the gap until smaller providers actually get the stimulus funding. So I think you are seeing a lot of innovation. Mr. Shimkus. And I appreciate that. My time is short and I don't mean to be disrespectful but I think that is going to be an interesting case study to follow to make sure that happens. There are just in the broadband world, the other committee I serve on is Telecommunications. There are still communities on dial-up. There are still communities not--and one of our attacks on the stimulus bill is they are overbuilding broadband areas and not deploying to what we call unserved areas. Well, Dr. Evans, you probably know that. Probably in Idaho and the eastern part of Washington State, there are unserved areas. So the stimulus on the other end has to get broadband out so everyone can take advantage of this. I got a chance to visit with Dr. Winkleman earlier today, and he brought up this issue that even though he is--and I have to do this before I do that. I am sorry. Two letters, I ask for unanimous consent, and one is a compelling argument of a community of 15,000--Mr. Starnes would know-- Washington County Hospital, Nancy Newby, president and CEO, a population of 15,000. They are on HIT already and did the risk, did the same thing. So there are folks who realize the importance of this and did it previous to the government intervening. In the HITECH Act, incentives are based on charges under the Medicare fee schedule or a provider can qualify for more than 30 percent of their volume is from Medicaid patients. As a rural health clinic, will you meet either of these criteria? Dr. Winkleman. We will have a very hard time achieving the standard under the--well, let me back up. We will be very close under the Medicaid, the arm of being 30 percent. Our problem under the Medicare arm is that since our reimbursement comes via the rural health clinic system and not directly from Medicare. Our charges to the Medicare fee schedule are very limited. The only thing we bill to Medicare fee schedule under fee-for-service are some ancillary things. So we really don't have a Medicare option despite the fact that we see a good percentage of Medicare patients. You know, we really are limited to the Medicaid option. And so for some of my partners--it would be different for me, I do family medicine where a see a good portion of children and a lot of them are Medicaid, but some of my partners that do primarily internal medicine, primary care and see mostly adults, a lot of those patients are Medicare and then they could be sort of left out in the cold. Seeing a large number of Medicare patients, having adopted EHR, using them meaningfully, and yet we don't really have the Medicare charges per se technically that qualifies under the incentive. Mr. Shimkus. Thank you, Mr. Chairman. My time is expired but I want to note Dr. Evans was nodding yes, I think and I guess she would agree with pretty much of that analysis. Ms. Evans. Yes, and actually we have heard the same concern from many of the rural health clinic providers that we have been talking to that they are shut out because they may not-- they basically bill via a bundled mechanism rather than the provider fee schedule so that leaves them out of Medicare, and then they don't see the 30 percent patient panel required for Medicaid or 20 percent of their pediatricians. So they are really very much interested in how CMS is going to address the fact that there may be no incentive payments coming to them. Mr. Shimkus. Well, hopefully CMS is paying rapt attention to this hearing and that is part of the record. We haven't talked about HIPAA implications. We haven't talked about the whole privacy debate. That is really critical when data is flowing, and I am not smart enough to go into, Mr. Chairman, so I yield back. Mr. Pallone. Thank you. Mr. Shimkus has asked unanimous consent to enter these two documents into the record. Without objection, so ordered. [The information appears at the conclusion of the hearing.] Mr. Pallone. Mr. Gonzalez. Mr. Gonzalez. Thank you, Mr. Chairman. This question will go to Dr. Evans. Has it been your experience--now, my understanding is, you are vendor neutral. That means when you go on site, the hardware has been purchased, the software. The system is in place, you just--I am going to read something to you. I am almost embarrassed, Mr. Chairman, and I am hoping Mr. Shimkus is not listening as to my sources of information. Mr. Shimkus. I usually don't. Mr. Gonzalez. That is an understatement. But anyway, this is Hilda Gorito of Kaiser Permanente: ``If you give a lumberjack who has been using an ax his whole life a chainsaw and he starts hacking at a tree with it, it is not going to help him at all. It is what you do with the technology that makes the difference.'' So you go there, and so now the physician who used to be a lumberjack now has the chainsaw, and you are going to teach him basically how to use that effectively about the technology. When you go on site, are you discovering that many times--I don't know how to put this--they have overpurchased? One size doesn't fit all, and my experience has been with my friends who are physicians and a couple of friends who actually sell the systems that a lot of physicians really are not--because you are coming after the fact, that prior to the purchase of what is a very expensive investment that it is not done many times with the knowledge. And Mr. Tullman, I want you to chime in as soon as Ms. Evans finishes. Where does a physician or a small practice get the direction and the advice to purchase only that which they really need and to make an investment and not realize the return that they could? Ms. Evans. Well, my experience in doing some of the consulting out in the field is that many times providers purchase something and then underutilize the system for a variety of reasons. I can't really speak to whether they have overpurchased, but what I have seen is that there are many functions and features that are available to them, particularly for reaching meaningful use, that they haven't even necessarily looked at or they don't know exist. And so we go into the practice to educate them about some of the availability of the features and functionality as well as determine the workflow by which they might be able to use the system is a more effective manner. Mr. Gonzalez. Your thoughts, Mr. Tullman? Mr. Tullman. Yes, I think I would concur, and we think the largest problem, most significant problem is underutilization, and that would be true in most pieces of software that people buy. They tend to use them not at the maximum but the minimum, so we think the RECs are a good idea. We also are seeing more and more physicians get counseling from a variety of ratings services so as a vendor we are evaluated by a number of different organizations and of course CCHIT, there are minimum requirements, so there used to be about 300 different electronic health record providers. Last year under CCHIT to meet the minimum standards, that 300, only 70 qualified as meeting the minimum requirements. Those requirements are now even greater and will continue to get greater, and we think that is a good thing. We think that it improves the value of the products. But your point I think is very important, and that is, and we believe it is one reason this legislation made sense and that was you weren't simply buying physicians electronic health records, you were saying we will help pay for them if you use them, and that is really the critical aspect of meaningful use, which we are very supportive of. Mr. Gonzalez. Last question. I have a minute. Ms. Bechtel, you represent the consumer and such, and I am one of those that just believe that a patient goes in there believing that the doctor is up to date on the latest literature, continuing education, has the best equipment and so on. Do you believe that HIT should be part of that equation, that each patient should expect that that particular physician have that electronic medical records and the efficiency, effectiveness and cost savings that it should bring? Ms. Evans. I do, and I think it is interesting because there are a number of consumers who see technology in every other sector in this country and assume that their physicians have it as well, but then they experience the acute challenge of trying to communicate with the care team, trying to coordinate their own health care, understanding that doctors just aren't talking to each other fully and in the way they could be without interoperable health IT and so we have done actually a fair amount of research with consumers directly to understand what do they think about information technology and the reasons that it appeals to them are exactly those but they get that it will begin to reduce the burden that they face, particularly around care coordination. So we would be delighted to start to see consumers asking their physicians are you a meaningful user of information technology, do you have an electronic health record. I know that when I chose my own doctor recently, it took me several months to find out that has an electronic health record, and I did, but to the point of this hearing, the practice actually doesn't use it in a meaningful way whatsoever. They really just actually automated paper. So I think the conversation has to start with, do you have an electronic health record, but it can't end there. It has to be, how are you giving me access to my health information, how are you sending me reminders, how are you summarizing my care for me and other benefits of technology. Mr. Gonzalez. Well, I thank all of you for your testimony. I yield back, Mr. Chairman. Mr. Pallone. Thank you. That concludes our questions, so we want to thank all of you for spending all of your time here today, and obviously this is very helpful and it is probably just the beginning of what we are going to have to look at in dealing with HIT. The way the rules work, you will get some written questions from members. We try to have them to you within 10 days, and then of course we ask you to respond as quickly as you can, and if you want to submit testimony, you can. But thank you very much. I really appreciate it. Without objection, this meeting of the subcommittee is adjourned. 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