Executive Summary
On December 27, 2013, the Centers for Medicare & Medicaid Services (“CMS”) and Office of Inspector General (“OIG”) published final rules that amend regulations commonly known as the “EHR Donation Regulations.” The EHR Donation Regulations consist of an exception to the physician self-referral law (Stark) (42 CFR 411.357(w)) and a safe harbor to the Anti-Kickback Statute (42 CFR 1001.952(y)). The EHR Donation Regulations allow certain entities to provide non-monetary remuneration to physicians and other health care providers in the form of software and information technology services. The final rules amend the EHR Donation Regulations by (1) extending the sunset date of the EHR Donation Regulations from December 31, 2013 to December 31, 2021; (2) excluding laboratory companies from the types permissible donors of electronic health record (“EHR”) items and services; (3) updating the provision under which EHR software is deemed interoperable; (4) clarifying the requirement prohibiting any action that limits or restricts the use, compatibility or interoperability of donated items or services; and (5) removing from the EHR Donation Regulations the requirement that the donated items and services have electronic prescribing capability. Hospitals and other health care providers who currently maintain EHR donation programs should consider how the final rules affect those programs.
The Sunset Provision
After considering comments received to the proposed rules, OIG and CMS have decided to extend the expiration of the EHR Donation Regulations by eight years to December 31, 2021. The EHR Donation Regulations were set to expire on December 31, 2013. Please note that some donation agreements may automatically expire on December 31, 2013 and will require a written amendment to extend the term of the agreement. This extension of the EHR Donation Regulations is effective as of December 31, 2013. All other changes to the EHR Donation Regulations will not take effect until March 27, 2014. (See 42 CFR 411.357(w) and 42 CFR 1001.952(y).)
Protected Donors
CMS and OIG are excluding laboratory companies from the types of entities that may donate EHR items and services under the EHR Donation Regulations due to the perceived potential for abuse. Effective March 27, 2014, anatomic pathology service laboratory companies and clinical pathology laboratory companies are excluded from the list of eligible donors. The amendment does not apply to hospitals who furnish clinical laboratory services through a laboratory that is a department of the hospital (however, it would apply to a hospital-affiliated or hospital-owned company with its own supplier number that furnishes clinical laboratory services that are billed using a billing number assigned to the company and not to the hospital, as it would be a laboratory company). (See 42 CFR 411.357(w)(1) and 42 CFR 1001.952(y)(1(i)).)
The Deeming Provision
Effective March 27, 2013, the EHR Donation Regulations have been amended to align with the Medicare and Medicaid Electronic Health Record Incentive Programs to state that software is deemed to be interoperable if, on the date it is provided to the recipient, it has been certified by a certifying body authorized by the National Coordinator for Health Information Technology to an edition of the EHR certification criteria identified in the then-applicable version of 45 CFR part 170 (or in other words, the definition of Certified EHR Technology at 45 CFR 170.102). The EHR Donation Regulations require that donated software be interoperable. Prior to this amendment, the software was deemed interoperable if a certifying body recognized by the Secretary of HHS has certified the software within no more than twelve months prior to the date it is provided to the recipient. The amendment links the definition of interoperable for donation purposes to the definition of Certified EHR Technology as used for the Medicare and Medicaid Electronic Health Record Incentive Programs. CMS and OIG believe this clarification will ensure that donated software is as interoperable as feasible, given the prevailing state of technology at the time it is provided to the recipient, and will provide donors and recipients a means to have certainty that donated software satisfies the interoperability requirement of the EHR Donation Regulations. (See 42 CFR 411.357(w)(2) and 42 CFR 1001.952(y)(2).)
Data Lock-In and Exchange
In order to achieve the goals of preventing misuse of the EHR Donation Regulations that results in data and referral lock-in and encouraging the free exchange of data, CMS and OIG have made limited clarifications to require that a donor (or any person on the donor’s behalf) does not take any action to limit or restrict the use, compatibility or interoperability of the items or services with other electronic prescribing or EHR systems (including, but not limited to, health information technology applications, products or services). The bolded language has been added by way of example and is a non-exhaustive list of some of the forms of technologies that are believed included within the meaning of the existing regulatory language. (See 42 CFR 411.357(w)(3) and 42 CFR 1001.952(y)(3).)
The Electronic Prescribing Provision
CMS and OIG believe that electronic prescribing is critically important; however, effective March 27, 2014, in light of developments since publication of the original EHR Donation Regulations that encourage adoption and use of this technology, the requirement that the donated software contain an electronic prescribing capability has been removed. The original EHR Donation Regulations required that donated software contain an electronic prescribing capability. Please note, however, that electronic prescribing technology will still be eligible for donation under the EHR Donation Regulations and under the separate electronic prescribing exception in 42 CFR 411.357(v) and safe harbor in 42 CFR 1001.952(x). (See 42 CFR 411.357(w)(11) and 42 CFR 1001.952(y)(10).)
Practical Takeaways
Providers who are donating or receiving items or services pursuant to the EHR Donation Regulations should review and amend the associated documents before providing or receiving a donation after January 1, 2014. Providers should determine whether:
- The donation agreement must be amended to prevent expiration on December 31, 2013.
- The software was donated by a laboratory company.
- The desired EHR system that lacks electronic prescribing capabilities or was not considered “interoperable” prior to amendment is now eligible for donation.
- There is limitation or restriction in the use, compatibility or interoperability of the items or services with other electronic prescribing or EHR systems (including, but not limited to, health information technology applications, products or services).
Please contact Michael Batt at 317.977.1417 or mbatt@hallrender.com, Alisa Kuehn at 317.977.1475 or akuehn@hallrender.com or your regular Hall Render attorney for assistance with examining and/or amending your EHR donation program or with any questions relating to the EHR Donation Regulations.
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