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Medicare and Medicaid Incentives for EHs

Medicare EHs

EHs can begin receiving EHR incentive payments in any federal fiscal year (FY) from FY 2011 to FY 2015, but payments will decrease for hospitals that start receiving payments in 2014 and later. To receive the maximum EHR incentive payment, Medicare EHs must have begun their participation by 2012. The last year to begin participating in the program is 2014. See the EHR Payment Tables for more information.

Incentive payments to EHs are based on a number of factors, beginning with a $2 million base payment.

  • To qualify for Medicare EHR incentive payments, Medicare EHs must successfully demonstrate MU each year they participate in the program.
  • Incentive payments for EHs are based on the calendar year (January to December). The reporting period for the first year is any 90 continuous days during the calendar year. The reporting period for all subsequent years, will align with the calendar year. All participants in the program during 2015 will have a 90-day reporting period.
  • Beginning in 2015, Medicare EHs who do not successfully demonstrate MU will be subject to a payment adjustment.

Medicaid EHs

To participate in the Medicaid EHR Incentive Program, an EH must adopt, implement, or upgrade to a certified EHR during the first participation year. The EH must also meet the minimum patient volume threshold (10 percent).

The Medicaid EHR Incentive Program, which will continue to pay incentives through 2021, is administered voluntarily by states and territories. EHs can participate for a total of six years and, unlike Medicare, participation years do not have to be consecutive. The last year that an EH can begin participating in the Medicaid EHR Incentive Program is 2016. See the EHR Payment Tables for more information.

  • Medicaid EHs can receive an incentive payment for adopting, implementing, or upgrading to certified EHR technology in their first year of participation. In subsequent participation years, Medicaid EHs receive incentive payments for successfully demonstrating MU.
  • Unlike Medicare, Medicaid has a patient volume requirement. To meet this requirement, EHs must have a Medicaid patient volume of at least 10 percent. Learn more about calculating patient volume.
  • Medicaid EHs will not be subject to payment adjustments, but Medicaid EHs who also treat Medicare patients will have a payment adjustment to Medicare reimbursements starting in 2015 if they do not successfully demonstrate MU.

See the EH Incentive Estimator [XLS - 151 KB] for help calculating provider payments under Medicare and Medicaid. (Persons using assistive technology may have limited access to the information in these files. For assistance, contact JoAnne Hawkins at (505) 767-6600, ext. 1525, or

Meet with your area MU coordinator or MU consultant for details about state-specific Medicaid requirements for demonstrating MU.