Fitch Ratings: EHR Incentive Pay Boosted Hospitals' Bottom Lines

Meaningful use incentive payments helped boost the bottom line of for-profit hospital companies by nearly $400 million in 2011, according to a report from Fitch Ratings, Modern Healthcare reports.

Under the 2009 federal economic stimulus package, health care providers who demonstrate meaningful use of certified electronic health record systems can qualify for Medicaid and Medicare incentive payments.

The report -- titled, "For-Profit Hospitals Quarterly Diagnosis" -- found that all of the investor-owned hospitals analyzed by Fitch Ratings received some EHR incentive payments last year.

According to the report, the incentive payments led the hospitals to experience a cumulative $396 million increase in earnings before interest, taxes, depreciation and amortization, as well as a cumulative $440 million boost in cash from operations.

The report authors said that last year's EHR incentive payments were "modest" and that they expect to see larger payments this year and in 2013 (Kutscher, Modern Healthcare, 4/26).

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