CCHIT: IFR underestimates regulatory economic impact

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The Interim Final Rule (IFR) model for costs to EHR vendors and developers is overly simplistic and significantly underestimates regulatory economic impact, according to the Certification Commission for Health IT (CCHIT), which submitted public comments on the IFR to the Office of the National Coordinator (ONC) for Health IT.

The Chicago-based CCHIT commented on the regulatory impact analysis required as part of the rule making process. According to CCHIT, while the IFR concludes that the new rules would not impact a significant number of small businesses, the Commission supplied data and analysis indicating the impact would be very substantial.

According to CCHIT, the IFR model estimates that EHR vendors will each bear a cost “somewhere between $10,000 and $250,000 per certification criterion to prepare a complete EHR or EHR module for testing and certification,” then multiples by the number of new criteria (25 percent of those previously required for CCHIT certification) and finally multiples by an estimated number of vendors to be certified (90 percent of the currently certified cohort).

“This overly simplistic, linear model fails to include a discontinuity any vendor that lacks the immediately available capital and development resources to add the new features required will no longer be competitive in the marketplace,” read CCHIT’s comments on the IFR.

“With regard to the Ambulatory EHR marketplace, vendors with annual revenue under $20 million – the Small Business Administration size standard for small software businesses -- represented 75 percent of certified vendors as of March 2009,” CCHIT stated.

“Based on this data, the assumption in the IFR that ‘many, if not all’ vendors are large businesses is incorrect, and the Health & Human Services Secretary’s certification statement that ‘…this interim final rule will not have a significant impact on a substantial number of small entities’ should be revisited.”

CCHIT also provided comments on the IFR’s requirements. “We congratulate ONC on the development of the IFR, but we believe the criteria and standards need refinement in order to drive an achievable step forward in the meaningful use of EHRs,” said Mark Leavitt, MD, PhD, chair of the Certification Commission, adding that the Commission is “concerned about the possibility of an unintended deceleration in the pace of EHR adoption.”

CCHIT highlighted three broad concerns about the IFR requirements:

•  Scope: According to the organization, the “Complete EHR” inappropriately includes administrative and billing functions, diverting funds and effort into unnecessary certifications of already-installed billing systems for every doctor and hospital seeking the EHR incentives.

Interoperability: Certain criteria and standards in the IFR may represent a step backward in progress toward EHR interoperability, by dropping standards including the standards for receiving electronic laboratory results and implementation guidance for exchanging clinical data that were already federally recognized and widely adopted, while other criteria demand an unrealistic leap forward, according to CCHIT.

•  Functionality: Some IFR criteria define required functions of an EHR too microscopically, adding unnecessary costs and complexity and creating barriers to innovation. “A particular concern surrounds the reporting of quality measures, with the IFR calling for standards and measures that are yet to be defined or that require significant revision to make them computable from EHR-based data,” CCHIT stated.

A copy of the comments is available at on CCHIT's web site,