United States: Final EHR Donation Rules Issued In Time For The New Year

On December 27, 2013, the U.S. Department of Health and Human Services' (HHS) Office of Inspector General (OIG) and the Centers for Medicare & Medicaid Services (CMS) issued final rules revising the Stark exception (42 CFR 411.357(w)) and Anti-kickback Act safe harbor (42 CFR 1001.952(y)), which permit certain health care organizations to donate electronic health record (EHR) items and services (the 2014 Donation Rules). Besides extending the expiration date for protected donations, the 2014 Donation Rules exclude laboratory companies from protected donors, eliminate the e-prescribing requirement, and clarify covered technologies and the provisions impacting EHR interoperability.

The current Stark and Anti-kickback EHR donation rules, published in 2006 and scheduled to sunset December 31, 2013, protect various entities that subsidize up to 85% of the donor's cost to provide recipients certain software and information technology, training, and services "necessary and used predominantly to create, maintain, transmit, or receive [EHR]." As with the 2006 rules, the CMS and the OIG harmonized the 2014 Donation Rules by considering comments on each other's proposed rule and finalizing revisions that are almost identical, accounting for statutory differences.

Effective March 27, 2014 (except for the extension of the sunset period in 42 CFR 411.357(w)(13)), the 2014 Donation Rules make the following modifications and clarifications.

Sunset Provision

The 2014 Donation Rules finalize a December 31, 2021, expiration date (instead of the proposed December 31, 2016, expiration date) and waive the 30-day delay in effective date for this provision to protect ongoing arrangements beyond December 31, 2013. Although commenters recommended making the exception and safe harbor permanent, the CMS and the OIG believed a permanent donation regulation would be a disincentive to EHR adoption in the near term and expressed concern that inappropriate donations of EHR would "lock in" data and referrals between recipients and donors.

Donors: Who's Out & Who's In

As with a handful of states that have limited or banned lab companies from donating EHR technology based on fraud and abuse concerns, the agencies drew a bright line and finalized their proposal to exclude lab companies from the scope of protected donors. The agencies cite wide-ranging stakeholder comments and specific complaints about donations in return for referrals as evidence of the necessity for the lab exclusion. As a result, donations of EHR items and services from both anatomic and clinical pathology service providers must be terminated or properly restructured before March 27, 2014, to qualify for protection.

While targeted donations and quid pro quo referral arrangements do not qualify for protection in any event, the agencies believe that an outright ban on lab company donations will address concerns about such conduct in that industry segment. Protected donations from hospitals that bill labs under their Medicare provider number and lab interfaces limited to order entry and result reporting will continue to qualify for protection despite the revision.

Software: Certification, Function, and Use

Interoperability – The current EHR donation rules in §§ 411.357(w)(2) and 1001.952(y)(2) require that the donated software be "interoperable" at the time it is donated. Software is "deemed" interoperable if it has been certified by an HHS Secretary-recognized body no more than 12 months before the date it is provided to the recipient. The agencies finalized the proposed modification that links "deemed" interoperability to the Office of the National Coordinator for Health Information Technology (ONC) certification criteria. Both the CMS and the OIG concluded that since the ONC's criteria and standards are implemented via a public process, interested parties would have more input and the process would offer more certainty to donors and recipients.

In a second revision to the "deeming provision," the agencies eliminated the 12-month look-back requirement in favor of recognizing certification to the then-applicable version of the criteria (editions that have been adopted but not yet retired by the ONC). The agencies intend to better track the ONC certification program and assure donors that their donation meets the interoperability requirement at the time of the donation. In finalizing the "deeming" provision changes, the agencies noted that software is not required to meet the deeming provision. Software meeting the definition of "interoperable" in the regulations will still be eligible for donation even if it is not certified.

Function – The 2014 Donation Rules finalize the proposed elimination of the e-prescribing feature of donated software in §§ 411.357(w)(11) and 1001.952(y)(10). Other policies now drive e-prescribing such that its requirement is no longer necessary. The agencies confirmed, however, that e-prescribing technology will remain eligible for donation under the 2014 Donation Rules or the Stark e-prescribing exception in § 411.357(v) and the Anti-kickback safe harbor at §1001.952(x).

Use – The agencies did not change the scope of covered technology or elaborate on the test for whether the items and services are equivalent to those currently possessed by the recipient. They did, however, reiterate that the software and functionality must be necessary and used predominantly to "create, maintain, transmit or receive" EHR, including "information services related to patient care (but not separate research or marketing support services)." Donated software used for research separate and apart from patient care-related clinical support and information services is not protected, nor is software conferring an independent value on the recipient unrelated to the need for EHR. Nonetheless, the elimination of the e-prescribing feature and the confirmation that the technology itself need not be certified to be interoperable permit donors to apply the "necessary and used predominantly" test to software relating to EHR (e.g., transitions of care software).

Donor Restrictions on Use, Compatibility, or Interoperability of Donation – Any donor limitations or restrictions on the use, compatibility, or interoperability of donated EHR items and services are prohibited under current rules to safeguard against data or referral lock-in. The 2014 Donation Rules clarify the prohibition of these restrictions on donated items or services with other e-prescribing or EHR systems by providing a nonexhaustive list that includes health information technology applications, products, and services.

Takeaways

The 2014 Donation Rules will have a positive impact on most donation arrangements (the exception being those involving lab donors) in the following ways:

  • Current donation arrangements that otherwise qualify for protection may be continued beyond 2013, although the parties will need to review their donation agreement to ensure there are no gaps in the time frames established and amend the agreement as necessary.
  • Labs and lab donation recipients will need to terminate donation agreements or properly restructure an arrangement under existing rules before March 27, 2014.
  • Before proceeding further, the parties may wish to validate that the prior arrangement fully satisfied the 2006 rules and state-law restrictions, especially with respect to any explicit or implicit provisions that could be characterized as an improperly targeted, quid pro quo donation or having been donated in a manner that directly takes into account the volume or value of referrals or other business generated between the parties.
  • Donors (other than labs) that submit claims for items and services covered by federal health care programs may wish to evaluate the scope of technology now that the e-prescribing component has been eliminated. Donated items or services related to patient care in the form of software, information technology, and training services that are necessary and used predominantly to create, receive, maintain, or transmit EHRs can be donated provided that all other conditions are met.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions