ELKHART — At least three Kansas hospitals have received the first available incentive payments for implementing electronic health records systems.

Morton County Health System in Elkhart received $1.4 million in Medicare-based incentives on Sept. 30, said the hospital's financial officer Jeff Weaver. Mercy Health Center in Fort Scott and Mercy Hospital in Independence also received incentive payments, but officials there did not know yet how much was received by their parent organization, Sisters of Mercy Health System.

This is the first year hospitals and providers could apply for incentive payments for adopting EHRs under the American Recovery and Reinvestment Act of 2009.

Two types

Two types of incentive are available: Medicare- and Medicaid-based payments. Hospitals may apply for both the Medicaid and the Medicare incentives. Physicians must choose which program to apply for and then may only switch programs once.

For Medicare-based incentives, providers can receive payments for up to four years as they meet increasingly higher standards for "meaningful use" of their EHR systems.

At Morton County Health System, Weaver said the hospital expects to receive a total of $3.58 million over the four years.

Twelve hospitals have attested that they meet the meaningful-use requirements and should be receiving payments soon, said Melissa Hungerford, vice president at the Kansas Hospital Association. The number of individual medical practices that have received payments is unknown, she said, because the federal Centers for Medicare and Medicaid Services (CMS) has not disclosed that information.

In April, Dr. Jen Brull became the first physician in the state to receive an incentive payment.

"Physicians have been paid much earlier than hospitals," Hungerford said. "In order for hospitals to meet meaningful use, they have to have all physicians and all of their staff trained and using the system. It's a significant effort to get everyone on board and able to use the system well."

Medicaid-based incentives

The Medicaid-based incentives will not be available until February, said Diane Davidson, project director for the state's Medicaid program.

Before providers can apply, Kansas' Medicaid HIT plan must be approved by CMS. Kansas submitted its plan to CMS on Sept. 1 and should receive a response by Nov. 1, Davidson said.

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 each subsequent year.

Davidson said about 2,800 physicians and 70 hospitals have expressed interest in applying for the Medicaid-based incentives.