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On April 9, 2013, the Office of Inspector General ("OIG") posted a notice of proposed rulemaking ("Proposed Rule") regarding the current anti-kickback statute safe harbor regulation concerning electronic health records ("EHR") items and services ("EHR Safe Harbor"). The proposed amendments to the EHR Safe Harbor include three key changes: (1) an update to the provision under which electronic health records software is deemed interoperable; (2) removal of the electronic prescribing capability requirements; and (3) extension of the sunset provision past December 31, 2013.

The current EHR Safe Harbor permits certain entities to provide technology-related items and services to certain parties to be used to create, maintain, transmit or receive electronic health records. The EHR Safe Harbor was enacted as a way of inducing hospitals to provide financial and technical assistance to office-based physicians to adopt EHRs without triggering violations of federal healthcare regulations.

Interoperability

The current EHR Safe Harbor requires that donated software be "interoperable at the time it is provided to the recipient." Interoperability has historically been determined by a "certifying body recognized by the Secretary." The time frame for interoperability has been within no more than 12 months prior to the date it is provided to the recipient.

The OIG has proposed to update this element of the EHR Safe Harbor to provide that the Office of the National Coordinator for Health Information Technology has the responsibility for recognizing "certifying bodies" for purposes of interoperability using an authorization process.

Additionally, the timeframe for certification is being extended from 12-months. The new language would provide that the software would be eligible for deeming if, on the date it is provided to the recipient, it has been certified to any edition of the electronic health record certification criteria that is identified in the then-applicable definition of Certified EHR Technology as set forth in 45 CFR part 170. The OIG recognized the ever-changing nature of EHR software development and reasoned that interoperability should be determined based on the prevailing state of technology at the time it is provided to the recipient.

E-Prescribing

The Proposed Rule also seeks to remove the requirement that the donated software contain an electronic prescribing capability in light of subsequent legislation passed by Congress and the HITECH Act, both of which institute electronic prescribing incentive programs for certain professionals. The OIG has identified sufficient policy drivers for e-prescribing such that deletion of the requirement would not have a significant impact on its use.

Sunset Provision

The EHR Safe Harbor is scheduled to sunset on December 31, 2013. The Proposed Rule seeks to extend the sunset date to December 31, 2016 or later, given the fact that while the healthcare industry has made great progress in the adoption of EHR technologies, such technologies are not yet universal. The OIG is seeking comments on whether the date should be extended to December 31, 2016, the last year for which one may receive a Medicare EHR incentive payment, or December 31, 2021, the last year for initiating participation in the Medicaid incentive program.

Additional Items

The Proposed Rule further seeks to limits the waivers to cover only hospitals, group practices, prescription drug plan sponsors and Medicare Advantage plans. The current language protects "any donor" that provides healthcare goods or services under Medicare or Medicaid, including laboratories and durable medical equipment suppliers.

CMS Response

The Centers for Medicare & Medicaid Services ("CMS") has issued a companion proposed rule for purposes of the Stark exception related to EHR items and services. CMS has stated that it may consider comments received by the OIG for purposes of its rulemaking.

Comments on both proposed rules will be accepted for 60 days from the publication in the Federal Register. If you have any questions regarding either the CMS or the OIG proposed rules or your current relationships with respect to EHR, please contact a member of our Health Care Team.