By Neil Versel, contributing editor

October 7, 2008 | BOSTON—With less than three months to go before Medicare starts paying incentives to physicians for electronic prescribing, the Centers for Medicare and Medicaid Services (CMS) is working frantically to get the word out about the benefits of such technology.

At least 1,400 people are gathering in a Boston hotel today for a whirlwind conference intended to tout the incentives and raise awareness among doctors, pharmacists, practice administrators, IT staff, vendors, and others who might have a role in e-prescribing before the program starts Jan. 1.

Acting CMS administrator Kerry Weems says Congress included “one very small but very valuable gift,” namely the e-prescribing financial incentives, buried deep in the Medicare Improvements for Patients and Providers Act that passed—over the president’s veto—in July. (See “Medicare Legislation Provides Incentives for ePrescribing.”)

The program will provide physicians with 2 percent bonus payments on top of regular Medicare fees in 2009-10, then a 1 percent bonus in 2011-12, followed by 0.5 percent in 2013. Starting in 2012, CMS will start docking providers 1 percent for failing to e-prescribe, a penalty that rises to 1.5 percent in 2013 and 2 percent in 2014. This money is in addition to the 2 percent bonuses doctors can earn for participating in the Physician Quality Reporting Initiative program.

CMS estimates that Medicare could save $156 million over the five-year life of the program through error prevention and efficiency improvements, but that figure is based on the 6 percent of physicians said to have e-prescribing systems at the end of 2007. That number now is around 8 percent and rising, according to CMS. “Our goal for this conference is to make [the savings] very different from those estimates,” Weems says.

“The key message of this conference is that you can’t qualify for the bonus if you don’t have an e-prescribing system,” says CMS chief medical officer Barry Straube.

David Brailer, the former national health-IT czar who now runs investment firm Health Evolution Partners (San Francisco) calls e-prescribing “bite-sized in terms of what physicians need to change and do,” something that help doctors make the first step toward adopting full electronic health records.

“You won’t go wrong investing your time and money,” says Brailer, whose company chose e-prescribing vendor Prematics as the recipient of one of its first investments.

“What’s the thin end of the spear? What’s the thing that really drives this into physician offices?” Brailer believes e-prescribing is the answer, and that bonus payments are the enticement. “Doctors are never sure what to focus their time on, so they do follow the money,” Brailer says.

“Our theme is accelerated adoption of this technology,” Weems says. CMS put the conference together in just six weeks, even including continuing medical education credit for physicians. “This conference is meant to jump-start that process,” Weems adds. “It’s about kicking down barriers and stepping on the accelerator for the next couple of months.”

CMS promises a final rule in November as part of the 2009 Medicare Part B fee schedule, to include a definition of “successful” e-prescribing, as well as the CPT codes which are eligible for the bonuses. “We wanted to hold the conference before [the rule comes out] to get a sense of where the industry stands,” Weems says.

“I think these Medicare incentives will go a long way in terms of overcoming some of these barriers,” says Jeffrey Smith, vice president for strategy and business development at pharmacy chain and pharmacy benefits manager CVS Caremark (Woonsocket, R.I).