Health Professional Shortage Area (HPSA) refers to an area determined to have a shortage of health professional(s). Medicare eligible professionals (EPs) participating in the EHR Incentive Program who predominantly furnish services in a geographic HPSA are entitled to an incentive payment limit increase for each payment year. In the Medicare EHR Incentive Program, an EP is considered eligible for the HPSA incentive if more than 50% of his or her covered professional services (e.g., Medicare Part B payments) are furnished in an area that is determined to be a geographic HPSA as of December 31st of the prior year.
Per the statute and the final rule, EPs who predominately furnish their services in a geographic HPSA and who have received the maximum non-HPSA incentive payment have their annual EHR incentive payment limit increased by 10%. The calculated allowed charge amount of the incentive payment for an EP who has predominantly furnished services in a geographic HPSA is 75% of the total allowed charges minus the non-HPSA incentive payment amount.
The EP who has predominantly furnished services in a geographic HPSA will earn a HPSA payment incentive of either the full payment increase amount or the calculated total allowed charge amount, whichever is the lesser amount.
EXAMPLE:
For 2011, if an EP who has predominantly furnished services in a geographic HPSA receives the maximum non-HPSA incentive payment of $18,000, the will receive a payment limit increase of $1,800.
Scenario 1: If this EP has $30,000 in total allowed charges for 2011, their calculated allowed charge amount would be $4,500. This amount exceeds the full payment increase amount of $1,800. Therefore, the EP will receive HPSA incentive payment of $1800.
Scenario 2: If this EP has $25,000 in total allowed charges for 2011, their calculated allowed charge amount would be $750. This amount is less than the full payment increase amount of $1,800. Therefore, the EP will receive the calculated allowed charge amount of $750.
Scenario 3: If this EP has $20,000 in total allowed charges for 2011, their calculated allowed charge amount would be less than $0. This amount is less than the full payment increase amount of $1,800. Therefore, the EP will not receive a HPSA incentive payment.
In 2011 CMS made the HPSA eligibility determination using the provider’s office location rather than the place of service for each individual claim. Payments for 2012 and later will use the place of service in the line item claim to determine HPSA eligibility.
Last Updated 2/7/2013
(FAQ7733)
