Looking forward to getting your hands on the $42,500 in federal stimulus package money for the EMR you’re buying? I’ve talked to too many physicians who seem almost bewitched by the idea of solving all of their information technology troubles with stimulus funds. Although the details of how money will be doled out are yet to be determined, there are several issues about which you should be aware:

There are two pools of funds to which dermatologists will have access: Medicare (up to $42,500) and Medicaid (up to $63,750). The Medicare funds are capped at 75 percent of the Medicare allowed charges and doled out over five years. In order to access the $18,000 maximum initial-year bonus from Medicare, you’ll need to have billed at least $24,000 in Medicare allowed charges that year. If you’ve set your fees at 300 percent of Medicare, that translates into a minimum of $72,000 in gross Medicare charges. (Of course, fee setting varies by practice, and this example is for illustrative purposes only.) If you have less, you won’t qualify for the entire $42,500. To access to the $63,750 in Medicaid funds, you need to have at least 30 percent Medicaid patient volume (pediatricians are the only exception, but even they are required to have 20 percent). Importantly, you won’t have access to both funds – if you qualify for Medicaid, you can’t get the Medicare money too.

The Medicare monies are for physicians only; your physician assistants and nurse practitioners won’t qualify for the stimulus money through the Medicare program. The Medicaid monies do include nurse practitioners, but, according to Section 4201, (3)(b) of the American Recovery and Reinvestment Act, physician assistants only qualify “insofar as the assistant is practicing in a rural health clinic that is led by a PA or is practicing in a Federally qualified health center that is so led.” 

The Medicare ePrescribing program offers participating physicians a 2% bonus in the current year, as well as in 2010. If you decide to go for the EMR incentives, you give up access to the ePrescribing bonuses.

Finally, it’s unlikely that either bonus—$42,500 from Medicare or $63,750 from Medicaid—could cover the cost of your entire system. Yes, you may be able to buy the software for less than either amount, but don’t forget that you’ll also need hardware, training, support—and most importantly, your time—to get your practice up and running with the EMR.

Don’t get me wrong: I encourage you to implement an EMR. But, let’s stop believing in the myth that the implementation will be profitable for your practice because you qualify for the stimulus packing funding. Understanding the nuances of the stimulus package - and how it relates to your dermatology practice - will help you make better decisions as your practice embraces technology.