The Health Information Technology for Economic and Clinical Health (“HITECH”) Act provides incentive payments through the Medicare and Medicaid programs to hospitals and certain individual health care providers – referred to as Eligible Professionals – that adopt and “meaningfully use” certified electronic health records (“EHR”) technology. As more and more individual health care providers receive these payments, an increasing number of medical practices have inquired about receiving these payments via reassignment from the individual providers.

The HITECH Act and the related rules do not provide for automatic payment of the EHR incentive payments to an Eligible Professional’s medical practice (including a medical practice affiliated with a hospital) or other entity which bills for the Eligible Professional’s services. However, the HITECH Act and the related rules do permit (but do not require) Eligible Professionals to reassign their right to receive the EHR incentive payments to an employer or other entity with which they have a contractual arrangement allowing the entity to bill for the services of the Eligible Professionals.4 This reassignment must be consistent with the general rules governing reassignment of Medicare and Medicaid payments. As a result, medical practices, medical practice foundations, community clinics and hospital outpatient clinics that bill for their Eligible Professionals’ services may receive the EHR incentive payments, provided that these organizations have taken appropriate steps to ensure receipt of such payments.