• Donations of Technology to Providers Program Extension
  • January 6, 2014
  • Law Firm: Holland Hart LLP - Denver Office
  • The Stark exception and Anti-Kickback safe harbor allowing for donations of electronic health records items and services to providers were both set to expire on December 31, 2013. With just days to spare, the Department of Health and Human Services’ Office of the Inspector General (“OIG”) and the Centers for Medicare and Medicaid Services (“CMS”) released final rules, extending the sunset dates through December 31, 2021.1 The proposed rules issued in April of 2013 would have only extended the sunset dates through 2016. However, both OIG and CMS agreed to extend the sunset dates to coincide with the expiration of the Medicaid meaningful use incentive payments.

    Health care providers should review these final rules and consider how they may affect currently existing electronic health records donation programs. Donation agreements may need to be updated to account for the extended sunset deadline.

    The final rules also:

    • Update the “Deeming Provision” - the new rules deem the software to be interoperable if, on the date it is provided to the physician, it has been certified by a certifying body authorized by the National Coordinator for Health Information Technology to an edition of the electronic health record certification criteria identified in the then applicable version of 45 CFR part 170;

    • Remove the electronic prescribing capability requirement - while both OIG and CMS recognize the importance of electronic prescribing, the rules remove the requirement, stating, “[w]e do not want to undermine important public policy goals by requiring redundant and sometimes expensive software capabilities that may not contribute to the interoperability of a given system" 2;

    • Exclude laboratory companies from the types of entities that may donate electronic health records items and services - due to a high risk of fraud and abuse, effective March 27, 2014, laboratory companies are now excluded from the scope of protected donors and such donations will not receive protection under either the Stark exception or the Anti-Kickback safe harbor; and

    • Clarify the conditions that prohibit donors from taking any action to limit or restrict the use, compatibility, or interoperability of the donated items or services--arrangements will not qualify for protection under the final rules if "the donor (or any person on the donor's behalf)" takes any "action to limit or restrict the use, compatibility, or interoperability of the items or services with other electronic prescribing or electronic health records systems (including, but not limited to, health information technology applications, products, or services). 3

    1 See Medicare Program; Physicians’ Referrals to Health Care Entities With Which They Have Financial Relationships: Exception for Certain Electronic Health Records Arrangements, 78 Fed. Reg. 78751 (December 27, 2013) (to be codified at 42 C.F.R. pt. 411); see also Medicare and State Health Care Programs: Fraud and Abuse; Electronic Health Records Safe Harbor Under the Anti-Kickback Statute, 78 Fed. Reg. 79202 (December 27, 2013) (to be codified at 42 C.F.R. pt. 1001).
    2 78 Fed. Reg. 78755; 78 Fed. Reg. 79206.
    3 78 Fed. Reg. 78769; 78 Fed. Reg. 79220.