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Doctor safe harbor on free hospital EHRs nears expiration

Organized medicine groups support extensions to anti-kickback and physician self-referral protections to encourage the growth of interoperable health information technology.

By Charles Fiegl — Posted June 24, 2013

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Physician organizations are urging federal health officials to continue protections that exclude donations of electronic health record software and services from federal anti-kickback and self-referral statutes.

The Centers for Medicare & Medicaid Services and the Health and Human Services Dept. Office of Inspector General have proposed extending a current anti-kickback safe harbor and an exception to the physician self-referral law for EHR arrangements among physicians and other entities, such as hospitals and Medicare insurers. The safe harbor and exception are set to expire Dec. 31.

The exclusions were created in a regulation published in August 2006. CMS has proposed a new rule that would prevent the exception and safe harbor provisions from sunsetting and make several updates to the regulations. For instance, the proposal would remove a requirement that eligible donated interoperable EHR software have an electronic prescribing capability.

“In addition to these proposals, we are soliciting public comment on other possible amendments to the exception, including limiting the scope of protected donors and adding or modifying conditions to limit the risk of data and referral lock-in,” CMS wrote in the draft rule.

The American Medical Association has advocated for federal officials to prevent the exception and safe harbor provisions from expiring. The Association offered comments on the proposed rule in a June 10 letter to administration officials.

“We strongly urge CMS and OIG to adopt an indefinite extension of the Stark law exception and anti-kickback statute safe harbor for the donation of EHR products and services,” the AMA wrote. “While we support CMS’ and OIG’s effort to extend the current Dec. 31, 2013, sunset date, the proposed sunset date of Dec. 31, 2016, is too near in the future to be effective.”

The proposed rule discusses an alternative sunset date of 2021. CMS chose the 2016 date because it is the last year in which physicians and other health professionals are eligible to receive Medicare payments for adopting and using EHRs.

CMS may narrow donor list

The OIG has received complaints alleging that when some EHR donors use the safe harbor to provide physicians software that allows for interoperable exchange of information, it leads to a “lock-in” under which the doctors find they are limited in where they can send data and patient referrals. CMS may revise the exception to cover only donors at hospitals, group practices, prescription drug plan sponsors and Medicare Advantage organizations instead of protecting any designated health services entity that donates EHRs.

“We are considering excluding suppliers of ancillary services associated with a high risk of fraud and abuse, because the donations by such suppliers may be more likely to be motivated by a purpose of securing future business than by a purpose of better coordinating care for beneficiaries across health care settings,” CMS stated. “In particular, we are considering excluding laboratory companies from the scope of permissible donors, as their donations have been the subject of complaints.”

The AMA said it understands the concern, but it also urged CMS and OIG to proceed carefully.

“Instead of narrowing the EHR safe harbor and exception, we think that CMS’ and OIG’s efforts should focus on education regarding the existing bounds of the safe harbor and exception, as well as appropriate enforcement, and we urge CMS and OIG to take that approach,” the AMA wrote.

The American Academy of Family Physicians wrote in a June 5 letter that it is concerned that many EHR systems are incompatible with new care models, such as the patient-centered medical home. The AAFP advocated “for systems that are capable of integrating information from multiple, diverse sources into a single system to support the comprehensive information needs of primary care.”

The AMA, AAFP and other organizations representing physician specialties supported removing the requirement that e-prescribing technology be included in any donated EHR software. Other programs, such as a Medicare incentive for reporting patient encounters that use e-prescribing, have encouraged physicians to adopt paperless drug orders.

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