On Dec. 23, the federal government released two rules that would allow hospitals to continue to give physician practices and other organizations electronic health record software without fear of Stark Law or Anti-Kickback Statute conflict through 2021.
Since 2006, hospitals have been allowed to donate or subsidize EHR systems for other care providers to allow for electronic data exchange without becoming subject to federal laws that would ordinarily prohibit such financial arrangements between hospitals and potential referrers. The final rules from HHS' Office of the Inspector General and CMS extended the Anti-Kickback safe harbor and Stark Law exception, respectively, past their original expiration date of Dec. 31, 2013, aiming to continue the expansion and use of EHRs among smaller organizations.
Industry stakeholders see the ruling as allowing hospitals around the country to continue to do exactly what they've been doing — following an EHR and IT adoption strategy that best fits the goals of the organization.
The American Hospital Association had long pushed for the extension, or ideally permanent adoption, of these legal exemptions. In a May letter to CMS Administrator Marilyn Tavenner, AHA Executive Vice President Richard Pollack pointed to the many hospitals and health systems across the country that are single-handedly fostering the adoption of health IT in their communities through the sort of financial support covered by the exemptions.
"The final rule should continue to explicitly include all hospitals and health systems within the scope of donors protected by the regulations and, therefore, eligible to provide assistance to physicians to support these important efforts," he wrote.
Now that the exemptions have become law, hospitals can continue to follow their own IT strategy, says AHA Assistant General Counsel, Lawrence Hughes. "The hospitals that are using [the safe harbor] to work with physicians will continue to do so," he says. "People will continue working as they have been."
The seven-year extension will not prompt hospitals to change their current strategy regarding regional health IT adoption, or cause a significant strategy shift among hospitals. "No organizations will be rushing out to take advantage of this who weren't already" says Mr. Hughes.
Rather, the exemptions bring relief to the hospitals with strategies reliant on their ability to make the right IT available to regional and affiliated providers. "We did hear from quite a few members, 'We want to facilitate EHR adoption and we do need some security,'" says Chantal Worzala, director of policy at AHA. "They're certainly appreciative protections are continued. They would have been very disappointed if they had expired."
HIMSS also expressed appreciation for the issued rules and for the avoided disruption to the industry. In a statement, HIMSS Vice President of Government Relations, Thomas A. Leary, said: "HIMSS is pleased that CMS and the OIG have promulgated extensions to the Stark exemptions and Anti-Kickback safe harbors… Although we encourage the elimination of the sunset provision, we appreciate the extension of the program to 2021 to provide certainty to stakeholders."
EHR vendors, too, saw the ruling as allowing the EHR market to continue to grow and adapt unimpeded. Allscripts sees the ruling as allowing hospitals to ensure IT infrastructures are ready to meet the demands of a changing healthcare industry. "The extension of the Stark and Anti-Kickback safe harbors is very positive news because healthcare providers can now confidently make related strategic planning decisions as they continue their efforts to move to a value based payment environment for the good of patients," the company said in a statement. "These safe harbors remain a key opportunity for healthcare providers as we all strive for full adoption of not only electronic health records but the other tools needed for successful health reform, analytics, population health capabilities and patient engagement software among them."
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