Saved By The New Year’s Bell — EHR Donation Stark Exceptions And Anti-Kickback Safe Harbors Are Modified Under The Final Rule

Posted by Donna Craig in Jan, 2014

Stark and Anti-Kickback electronic health record (“EHR”) donation rules that were scheduled to expire on December 31, 2013 where modified in a final rule on December 27, 2013 to extend certain arrangements for the donation of EHR software or information technology and training services. The Department of Health & Human Services and the Centers for Medicare & Medicaid Services issued final rules allowing certain health care organizations to subsidize up to 85% of the donor’s cost of certain EHR items and services, subject to certain modifications.

 In contrast to the 2006 EHR donation rules, the final rule excludes lab companies (anatomic and clinical pathology service providers) from the list of acceptable donors.  In excluding lab companies from the scope of protected donors it was felt to be the best way to reduce the risk of misuse of donations by both donors and recipients.  The final rule would eliminate redirecting referrals for lab services following donations from lab companies.

 On issuance of this final rule, donation rules are now extended through the year-end 2021.  The final rule also removes the requirements that donated EHR include electronic prescribing capabilities, although e-prescribing software may still be donated.  Software interoperability will not require software to be certified by the Office of the National Coordinator (“ONC”) within the previous 12 months, provided such software meets the interoperable criteria in the final rule. The use of donor software must be necessary and used predominantly to “create, maintain, transmit or receive” EHR, which includes information services related to patient care, but may not be used for separate research or marketing support services.

 Practical Tips –

1.  Current donation arrangements that have qualified pursuant to the 2006 rule should be reviewed to determine if such agreements must be amended to ensure there are no gaps in the timeframes established by the final rule;
2. Labs and lab donation recipients may need to terminate donation agreements or restructure the arrangements before March 27, 2014;
3. Confirm that any donation arrangement does not contain a quid pro quo to take into account the volume or value of referrals or other business generated between the parties; and
4. Donors other than labs, need to evaluate that all donated items and services relate to patient care in the form of software, information technology, or training services are necessary and used predominately to create, receive, maintain, or transmit EHRs.

 If you have any questions on how current EHR donations arrangements are affected, or need to restructure current agreements, feel free to contact Donna J. Craig, RN, JD at The Health Law Center, PLC.