Medical Services

Medicaid Electronic Health Records Incentive Payment Program

Eligible Hospitals

Eligible hospitals include:

  • Acute care hospitals meeting the minimum 10 percent Medicaid patient volume.
  • Children’s hospitals that are certified and predominantly treat individuals less than 21 years of age.

Eligible Hospitals per Requirements

Eligible Hospital Minimum 90-day Medicaid
Patient Volume Threshold
Average Length of Stay Last four digits of CMS Certification Number
Acute care hospitals including Critical Access Hospitals
10 percent
25 days or fewer
0001 – 0879 or 1300-1399
Children's Hospitals

The Centers for Medicare and Medicaid Services (CMS) Certification Number will be used as a unique identifier of an eligible hospital for participation in the incentive program. Eligible Hospitals demonstrate patient volume annually, measured by a ratio where the numerator is the total number of Medicaid patient encounters over any continuous 90-day period in the most recent calendar year and the denominator is all patient encounters over that same 90-day period.

Medicaid encounters are:

  • Services rendered to an individual, qualified through inpatient dischrages or emergency departmetn on any one day where Medicaid:
    • paid for part or all of the service, or
    • paid all or part of their premiums, co-payments, and/or cost-sharing.

Adopt, Implement, Upgrade or Meaningful Use Requirements

In the first year of participation, eligible providers can adopt (acquire, install), implement (commence utilization of EHR such as training or data entry), or upgrade (expand) to a certified EHR capable of meeting meaningful use requirements.  Eligible providers are not required to demonstrate meaningful use in the first year and no EHR reporting is required.  Eligible providers who have already adopted, implemented or upgraded would still receive a 1st year payment.  For a list of certified EHR technology, visit the Certified HIT Product List.

Eligible providers should demonstrate meaningful use through:

1.  Use of certified EHR technology in a meaningful manner such as e-prescribing.

2.  Use of certified EHR technology for electronic exchange of health information to improve quality of health care.

3.  Use of certified EHR technology to submit clinical quality measures (CQM) and other measures.

Reporting Information

Reporting period is 90 days for first year demonstrating meaningful use.  For subsequent years, reporting period is one full year in federal fiscal year.  There is no EHR reporting period for adopting, implementing, or upgrading.

Meaningful use reporting for subsequent years of participation consists of:

  • 14 Core and 5 Menu Measures and
  • 15 total Clinical Quality Measures 

Payment Information

Payment is determined by using a formula of overall EHR amount times Medicaid share. Payment is calculated then disbursed over 3 years based on a Federal Fiscal Year. The payment schedule is at 40% in the first and second years and at 20% in the last year of participation.  Payment is calculated then disbursed over 3 years based on a Federal Fiscal Year. Hospitals cannot initiate payments after 2016 and payment years must be consecutive after 2016 through 2021.

Eligible hospitals who qualify for both Medicare and Medicaid Incentive Programs

Eligible hospitals can participate in both the Medicare and Medicaid programs to receive incentive payments. The Medicare program is run by the Centers for Medicare and Medicaid Services (CMS) while the Division of Medical Services oversees the state's Medicaid program.    

Registration Information

  • Eligible hospitals must initially register with CMS. For the CMS Registration User Guide and additional information, visit the CMS website.
  • After registering with CMS, you can register and attest for the South Dakota Program.