Health Law Update

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As the final days of 2013 passed and the sunset of the Stark Law exception and anti-kickback law safe harbor for electronic health record (EHR) donations loomed nearer, the U.S. Department of Health and Human Services (HHS) Centers for Medicare and Medicaid Services (CMS) and Office of Inspector General (OIG) issued last-minute final regulations to extend the expiration date of the provisions through 2021, subject to certain exclusions. CMS cited as its reason for extending the sunset date that the adoption of interoperable EHR technology remains an important goal of HHS.

CMS and OIG each limited the categories of protected donors of EHR technology in the final rule in an effort to curb potential fraud and abuse identified by commenters arising from such arrangements. Specifically, CMS and OIG excluded laboratories from the list of protected donors due to reports of labs conditioning donations of EHR on physicians' referrals. CMS stated it was concerned that such abusive arrangements may impact patient care if physicians make referral decisions based on the donation of EHR technology rather than the quality of services provided by a lab. Laboratories that are departments of a hospital and billed under the hospital's provider number will continue to qualify as protected donors. CMS and OIG also clarified that any action taken by a donor or any person on behalf of the donor, including the EHR vendor or the physician recipient, to limit the use of the donated items or services would not be protected under the exception and safe harbor. The agencies specifically stated that a vendor that charges high interface fees to nonrecipient providers or the donor's competitors may pose concerns that parties were improperly locking in referrals. The final rules also updated the interoperability deeming provision and removed the electronic prescribing capability requirement.

OIG and CMS Extend Expiration Date for EHR Donations