It's been widely reported that 17% of eligible providers dropped out of the meaningful use program after 1 year of participation. There are hundreds of reasons one can point to in order to explain this statistic. But there's only one reason that matters: poorly designed incentives. With better-designed incentives, all of the other issues would have worked themselves out, and providers would've begrudgingly jumped through the meaningful use hoops.
Incentives matter. Our nation's healthcare cost problem is the result of decades of misaligned incentives (fee-for-service). Wall street collapsed in 2008 because bankers were structuring securities based on shortsighted, greedy, poorly designed incentives. People will act to maximize the clearly defined financial incentives laid out for them.
The problem with the meaningful use payout program is that the financial rewards decrease over time:
Year 1: $18,000
Year 2: $12,000
Year 3: $8,000
Year 4: $4,000
Year 5: $2,000
As the meaningful use program progresses and gets more complicated and rigorous, providers are given less incentive to stay the course. Year 1 only requires 90 days of attestation (aka headache). Year 2 requires 360 days (aka 4x the headache). On the other hand, consider an alternative payment structure:
Year 1: $5,000
Year 2: $8,000
Year 3: $9,000
Year 4: $10,000
Year 5: $16,000
In this scenario, if after one year a provider got sick of the government's bullshit, they would have only recouped $5,000 of the $30,000+ they probably spent on an EHR. They probably would've felt compelled to stay the course to recoup their initial capital outlay. Initial adoption may have been a bit slower than it actually was, but in the long run, that wouldn't have mattered much anyways. There're three distinct classes of providers: those that accept EHRs, those that reject EHRs, and those that avoid EHRs because they don't accept Medicare or Medicaid. There's nothing the government can do to change the minds of the providers in the latter two groups, so instead they should've aimed to maximize the success and participation of those in the first group.