In 2006 and extended in December 2013, CMS issued Stark and Anti-Kickback exceptions/safe harbors permitting EHR technology donation arrangements between hospitals (and other organizations) and physician groups. This exception permitted hospitals to aid physician groups, who may be referral sources, in acquiring and implementing EHR and other health information technology. Originally, hospitals had a seven-year window in which to engage in these donation arrangements, though in December 2013 CMS extended the donation arrangements for an additional 7 years through December 31, 2021.
The arrangement may include the non-monetary donation of “items or services in the form of software or information technology and training services.” Key components of the exception/safe harbor include:
- The donation is provided from an entity to a physician.
- Change in 2013 rules, this entity cannot be a lab.
- The software is interoperable
- Change in 2013 rules, software is deemed interoperable if it has been certified as “certified EHR technology” as that term is used by the ONC for the meaningful use/EHR Incentive Program.
- Donor cannot restrict or limit the use or interoperability of the technology with other eRx or EHR systems.
- Change in 2013 rules, CMS interprets this rule more broadly by providing a non-exclusive list of the types of technologies that are included in this restriction: “health information technology applications, products, or services.”
- Physician must pay at least 15% of the costs for the technology (which amount cannot be financed by the hospital).
- Neither the physician nor the physician’s practice makes the receipt of the technology a condition of doing business with the donor.
- Neither eligibility of the physician nor the amount or nature of the donation is determined in a manner that takes into account the volume or value of referrals or other business generated between the parties.
- The donation is set forth in writing, signed by the parties, specifies the items to be provided, the donor’s costs and the physician’s contribution, and covers all EHR items and services to be provided by the donor.
- The donor cannot have knowledge of or disregard the fact that the physician already possesses equivalent items or services.
- The donor cannot restrict or limit the physician’s right to use the software for any patient.
- The donation cannot include staffing of physician offices and cannot be used to primarily conduct personal business or business unrelated to the physician’s medical practice.
- Note the donation may also include other “software and functionality directly related to the care and treatment of individual patients (for example, patient administration, scheduling functions, billing, clinical support software, etc.” (71 FR 45152).
- The donation arrangement does not violate the Anti-Kickback statute.
- The exception expires December 31, 2021.
Beyond crafting a donation arrangement that satisfies both the Stark law exception and Anti-Kickback safe harbor, hospitals and physicians should assess overall technology alignment strategies and the goals and framework for such donation arrangements. Making sure that clear expectations are set in advance, including understanding implementation, roll out and support, data ownership and extraction, and utilizing the EHR technology for government incentive programs, such as meaningful use, are important topics that should be addressed by the arrangement.
For those interested in learning more about this topic and are currently attending HIMSS14, David Schoolcraft, attorney at Ogden Murphy Wallace, and Michelle Holmes, principal at ECG Management Consultants, are presenting on Wednesday at 10 AM on Using Stark/Anti-Kickback To Support Hospital/Physician IT Alignment Strategies. For further information about designing a compliant arrangement please contact Elana Zana or Dave Schoolcraft.