July 30, 2010 
“Skipping years” means losing incentive money.  
While we all keep a laser focus on achieving Stage 1 of Meaningful Use, it is important that we plan for the requirements of the subsequent stage as well. There is a new concept of “skipping years” that has been introduced in the final Meaningful Use Ruling. This concept is one that needs to be considered as we look to our long-term IT strategic plans related to Meaningful Use for the next few years.  
How does this work?
The first consideration is to determine when the eligible hospital wants to register with The Center for Medicare and Medicaid Services (CMS) for their first Meaningful Use adoption year. This is the first year that the hospital will begin reporting and attesting to the Meaningful Use core and chosen menu standard. This process starts with a 90-day continuous-reporting period.
Outlined below is the revised CMS payment table in the final rule. Changes include the removal of Stage 3, FY2015 requirements at this time, and a relaxing in the 2014 requirement for first adopters in 2013 to jump to Stage 2 in a single calendar year. Stage 3 requirements will be forth coming. The changes have been highlighted in yellow in table 1.
                      CMS Payment Table – (Table 1)



The next consideration topic for the timing for achieving Stage 1 Meaningful Use criteria is the implication and timing of achieving Stage 2 requirements. This is how the “skipping years” concept needs to be part of the planning process.  
This “skipping years” concept is related to two requirements in the final ruling;
  1. The incentive program is available to an eligible hospital for four contiguous years.
  2. A hospital cannot remain at Stage 1 for more than two years.
So why is this important to the eligible hospital?  
If a hospital starts the reporting process in FY2011, they must be ready to move to Stage 2 in FY2013 (October 1, 2012). If the hospital cannot meet Stage 2 at that time they will be forced into “skipping a year” of incentive (in this case a 50% incentive calculation) and will forfeit incentive payments at that time. If that same hospital achieves Stage 2 in the next fiscal year (FY2014), they will be eligible for incentive money but it will be at the next logical year’s tiered calculation or 25%.
Since the incentive is only available for four consecutive years, this will be the final year that the hospital will be eligible for incentive money under this program. In this case the hospital will only receive three of the potential four years of potential incentive dollars at the tiered incentive rate of 100%, 75%, and 25%. If they never achieve the Stage 2 criteria prior to FY2015, then they would only receive the incentive dollars for the first two payment years.  
Skipping years does not apply to Medicaid in the same way. There is no reporting requirement for meeting Meaningful Use criteria for Year One. Year Two requires 90 days of reporting and Year Three requires a full year of meeting all requirements.
Takeaway
Meaningful Use has implications over a number of years. It is essential to consider the Stage 1 and Stage 2 requirements in our gap analysis and IT strategic planning. Future capital requirements, operational and clinical ramifications will need to be considered, as well as the governance to shepherd the process. Planning, timing, and milestones to consider;  
  • Incentive dollars are available for (at most) four years.
  • Make sure you are ready for Stage 1 and have a plan to get to Stage 2 in the given timeline.
  • You can wait until FY2012 to register for Stage 1 and still receive all four years of incentives.
  • If Meaningful Use is not met in a given reporting year, then the incentive is “skipped.”
  • The reporting year for FY2011 begins October 1, 2011.
  • CMS registration website will be open in January, 2011.
  • It is anticipated that the earliest possible payment will be May, 2011.
  • Te latest a hospital can start to demonstrate Meaningful Use and still be covered in the FY2011 is July, 2011.
“Strong governance and planning are key factors in the success of meeting Meaningful Use goals in the short and long-terms.”
Paula Gwyn, Strategic
Planning, CareTech Solutions
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