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Electronic Health Information System Proposed Regulations Ancillary Providers

Proposed CMS Rules Suggest Possible Future Changes To E.H.R. Donation Rules

ehr donation agreement proposed regulationsThe proposed regulations that were recently released by CMS and the OIG relating to electronic health record donations, provides a glimpse of what may be expected in the future.  Both agencies refer to concerns over “data lock” situations and donation agreements entered with clinical laboratories, DME companies, and other ancillary providers.  Although neither agency placed limitations on these arrangements in the current proposed rules, they both make it clear that they are looking closely at who should be a qualified donor under the donation regulations.

As they currently stand, the only effect of the proposed regulations would be (i) to extend the donation agreement sunshine deadline from December 31, 2013 to December 31, 2016, and (ii) to remove the requirement that software include electronic prescribing.  However, comment was solicited in other areas that make it pretty clear that we should expect the final rules to include other changes.

CMS appears to be considering what approach to take to address reports of clinical laboratories, DME providers and other ancillary providers using the Stark Law exception to enter into abusive arrangements.  CMS suggests that they may exclude certain classes of providers from being qualified donors.  They also allude to the possibility of adding an additional set of requirements to prohibit “data lock” situations.  They appear to be considering taking one or both approaches when final regulations are released.

For now, comments can be made to the proposed regulations.  Providers who have an interest in this issue might want to consider submitting comments in response to the OIG and/or CMS proposed regulations.  In the meantime, the discussions coming from the regulatory agencies cast a shadow over donation arrangements with many ancillary providers.  Even though the arrangements meet Stark Law and safe harbor provisions at the present time, it is not clear whether arrangements that are entered before the issuance of final regulations will qualify to permit extension of donation benefits beyond the first Sunset date of December 31, 2013.

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John H. Fisher

Health Care Counsel
Ruder Ware, L.L.S.C.
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