TOPEKA — The state's Medicaid health information technology plan has been approved by the federal government, which means Kansas hospitals that have implemented electronic health records may be able to apply for Medicaid-based incentives this year.

Diane Davidson of the Division of Health Care Finance said if all goes well, a website where hospitals can apply for the incentive payments will be launched by Dec. 12. The Division of Health Care Finance at the Kansas Department of Health and Environment oversees the state's Medicaid program.

But even if the agency meets its target for launching the website, that would leave hospitals little time — until Dec. 29 — to apply for payments based on 2011 use of electronic health records, given current deadlines set by the federal Centers for Medicare and Medicaid Services.

The deadline for applying for the incentives is 90 days after the annual program period ended, which for hospitals was Sept. 30. Davidson said she expects to hear from CMS next week whether applications can be accepted beyond 90 days.

"I'm fairly confident that next week we'll hear that we can allow longer than that," she said. "Even if we do get up and running in time, (three weeks) is a pretty short period to get applications in, so I think CMS will allow us to take them longer than 90 days afterward."

But Davidson said interested hospitals should start preparing to attest now, if they want the bonus payments.

For doctors and other providers, the Medicaid incentive program period ends Dec. 31, and then they have 90 days to apply. But the division won't accept their incentive payment applications until February, Davidson said.

Davidson announced the federal approval of the state's plan, which occurred Oct. 27, in her report Wednesday to the Kansas Health Information Exchange Inc. board. KHIE is the agency regulating health information exchange in Kansas.

The incentive payments were made available by the federal economic stimulus law passed in 2009 for health care providers whose electronic health record systems meet the federal government's "meaningful use" standard.

This is the first year that payments were available to providers of Medicare or Medicaid services.

Physicians who apply can receive up to $63,750 in incentives during the six-year program — an initial payment of $21,250 and up to $8,500 per year. Hospital payments are based on a number of factors, but begin with a $2 million base payment.

Hospitals may apply for both Medicaid- and Medicare-based incentives. Physicians must choose to apply for Medicare or Medicaid incentives and then may only switch programs once. Kansas doctors started receiving Medicare-based incentives in May, and hospitals in October.

Hospitals can qualify for Medicaid-based incentive payments if at least 10 percent of their patient volume is Medicaid. For doctors the threshold is 30 percent, although pediatricians can qualify if their patient load is 20 percent Medicaid.

However, the formulas for calculating the percentages were not available until the state's Medicaid HIT plan was approved. Officials had planned to have the plan ready and approved earlier this year but announced in July that the timeline had been pushed back because the plan wasn't ready to be submitted.

The percentage formula for hospitals is now available on the state Medicaid website.

About 60 of the state's 127 community hospitals likely will qualify for the incentives, said Melissa Hungerford of the Kansas Hospital Association.

"We don't know whether they will all apply," Hungerford said.