AHLA. Y. Advising Providers in Adopting or Substituting a Health IT System. Charles C. Dunham Bond Schoeneck & King PLLC Albany, NY

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1 AHLA Y. Advising Providers in Adopting or Substituting a Health IT System Charles C. Dunham Bond Schoeneck & King PLLC Albany, NY Health Care Transactions April 10-11, 2014

2 Advising Providers in Adopting or Substituting a Health IT System Charles Dunham, Esq. Bond, Schoeneck & King PLLC Albany, NY Promoting EHR Adoption EPrescription and EHR Donations o Anti-Kickback Statute and Stark Law (2006) Federal EHR Incentive Program o HITECH Act - Title XIII of the ARRA of 2009 o Medicare and Medicaid Incentive Program o Eligible Professional (EP)/Eligible Hospital (EH) o Adoption and Meaningful Use of EHRs 1

3 Anti-Kickback Statute and Stark Law EHR Donation Safe Harbor Must be ONC certified (2011 or 2014 Edition) Donee must pay at least 15% of donor costs No prior equivalent items or services Not based on Business Generated/Volume or Value Rights, licenses and intellectual property related to EHR software; interface and translation software; connectivity services; clinical support and information services; maintenance services; secure messaging; and training and support services Amendment: December 27, 2013 (78 Fed.Reg ) New Sunset Date: Dec. 31, 2021 Federal EHR Incentive Payments Meaningful Use (MU) Objective: to improve quality, safety, efficiency, and reduce health disparities MU Staged in Three Steps over Six years: o Stage 1 (2011) - Data Capture and Reporting o Stage 2 (2014) - Advanced Clinical Processes o Stage 3 (2017) - Improved Outcomes Certified EHR Technology (Complete or Modular) o Authorized Testing and Certification Body (ONC-ATCB) o Certified Health IT Product List (CHPL) Register Use Attest 2

4 Federal EHR Incentive Payments Eligible Professionals Medicare Up to $44,000 over (5) years ONLY Physicians o Doctor of Medicine o Doctor of Osteopathy o Doctor of Oral surgery or dental medicine o Doctor or Podiatric medicine o Doctor of Optometry o Chiropractor Bill Physician Fee Schedule Less than 90% services Inpatient Hospital or ED *MA-Affiliated EPs *Assignment Medicaid Up to $63,750 over (6) years Physician, Dentist, CN, NP or PA in FQHC/RHC led by PA EPs must meet ONE criteria 30% Medicaid Patients in Outpatient Setting (20% Pediatricians) FQHC or RHC with 30% needy patient volume Less than 90% services Inpatient Hospital or ED Except EPs in FQHC/RHC *Assignment Federal EHR Incentive Payments Eligible Hospitals Medicare Subsection (d) Hospital o Acute Care Inpatient Hospitals and Critical Access Hospitals (CAHs) Up to (4) years of Incentive Payments o FY 2011 to FY 2016 Payments will decrease for first year in 2014 and later FY 2015 will begin payment adjustments *MA-Affiliate Hospital Medicaid Acute Care Inpatient Hospitals, CAHs, and Cancer Hospitals (11) o 25 day or less patient stay o 10% Medicaid threshold, except Children s Hospitals Up to (4) years of Incentive Payments o FY 2011 to FY 2017 No payment adjustments 3

5 EHs Incentive Payments Payment Calculation Medicare Medicaid Acute Care Inpatient Hospital o Incentive Payment Calculation Initial Amount Medicare Share Transition Factor Critical Access Hospital o Incentive Payment Calculation Reasonable Cost of Certified EHR System Medicare Share plus 20 percentage points Incentive Payment Calculation o Overall EHR Amount o Medicaid Share o Overall EHR Amount = Initial Amount Medicare Share (set at 1) Transition Factor Medicare EHs Incentive Payments Acute Care Inpatient Hospital 4

6 EHR Vendors and Products 550-plus EHR vendors (HealthIT.gov) o 1932 A&I Complete EHR (2011 Certified) o 1805 A&I Modular EHR (2011 Certified) o 2108 A&I Complete EHR (2011/2014 Certified) o 2558 A&I Modular EHR (2011/2014 Certified) o 176 A&I Complete EHR (2014 Certified) Federal EHR Incentive Payments 85% EHs and 60% EPs have received EHR Incentive Payments (CMS 12/2013) Approximately $40 Billion in EHR Incentive Payments (National Health IT) CMS EHR Incentive Payments could Top $22.5 Billion in 2014 (3/4, Conn, Subscription Publication) Program Integrity Concerns and Audit Investigations Pay Now Confirm Later Texas Hospital Chain Fraud Charges - $18 million EHR Incentive Payments EHR Vendors and Products Provider Satisfaction/Substitution 17% planned to switch EHR vendors in 2013 (Black Book Rankings) 80% said that their EHR system did not meet their needs 77% said that the design of their EHR was ill-matched to their practice specialty 44% said that their EHR vendor was unresponsive to their needs and requests Allscripts Lawsuit MyWay Cloud Based EHR System Sold to approximately 5000 physicians (solo and group practices) Class Action suit initiated by group of doctors in small practices Complaint alleges failure to perform as promised and update software 5

7 Due Diligence Software Functions and Adaptability o ICD-10 Compatible (Deadline Oct. 1, 2014) o 2014 Edition Base EHR (All MU Stages) (77 Fed.Reg ) o 2017 Edition (Fall 2014) Complex Connectivity and Networking Scheme o HIE and RHIOs o ACO Progression o EHR Adoption of Mobile Devices Recurring or Hidden Fees Audits or E-Discovery Production Current Capacity and Financial Viability Cloud Computing Server-Based vs. Cloud Computing System Availability and Performance Data Access and Control o Integration and Delivery o Location of Data o Multiple User Environment o Hosting Party and Subcontractors Upgrades and Enhancements Data Backup and Record Retention Transition or Termination 6

8 Critical Terms and Conditions Service Level Agreement Training and Implementation Maintenance and Service Standards Interface and Interoperability Upgrades and Enhancements Vendor Transition Commitment Vendor Transition Commitment Upon termination or expiration of this Agreement for any reason, Vendor will assist Client to perform a onetime data transfer to the Client s new EHR system and/or provide the data securely onto a storage medium in a market standard format, for no additional fee, and will allow Client to continue to use the Software until all data is transferred to a new system and a backup copy of the data has been delivered. Such data shall be provided to Client in an industry-recognized, nonproprietary format. 7

9 Warranties, Liabilities & Remedies Promise v. Performance Software and Service Standards Compatibility with Third Party Products Meaningful Use Warranty Limitation of Liability & Remedies o Implied Warranty of Merchantability o Implied Warranty of Fitness for a Particular Purpose o Exclusion of Consequential or Other Damages o Cap on Cumulative Dollar Amount Limitation of Liability NO OTHER WARRANTIES: THE WARRANTIES SET FORTH IN THIS SECTION ARE LIMITED WARRANTIES AND ARE THE ONLY WARRANTIES MADE BY VENDOR. EXCEPT FOR SUCH WARRANTIES, ALL SOFTWARE PRODUCTS ARE PROVIDED Software ASWarranties. IS WITHOUT WARRANTY Vendor OFwarrants ANY KIND, AND that, TO for THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, VENDOR DISCLAIMS a period of (120) days from the time of delivery, ALL OTHER WARRANTIES AND CONDITIONS, EITHER EXPRESS OR IMPLIED, INCLUDING, installation BUTorNOT access, LIMITED theto, Software IMPLIED will WARRANTIES function OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, DATA INTEGRITY, substantially ABSENCEinOF accordance ANOMALIES OR with NON-CONFORMITIES, the functional ERROR- FREE OPERATIONS, UNINTERRUPTED SERVICE, TITLE, OR NON- INFRINGEMENT, descriptionswith of REGARD the Software TO THE SOFTWARE contained PRODUCT within AND THE PROVISION OF OR FAILURE TO PROVIDE SUPPORT SERVICES. VENDOR DOES NOT thiswarrant Agreement THAT THE andsoftware relatedproducts documentation. WILL MEET CLIENT S REQUIREMENTS, THAT THE SOFTWARE PRODUCTS ARE FREE FROM ANY BUGS, VIRUSES, ERRORS OR OTHER PROGRAM LIMITATIONS, THAT THE OPERATION OF THE SOFTWARE PRODUCTS WILL BE UNINTERRUPTED OR ERROR-FREE, OR THAT ERRORS IN THE SOFTWARE PRODUCTS WILL BE CORRECTED. Vendor shall repair or replace any Software component that fails to perform substantially in accordance with the functional descriptions of the Software contained in this Agreement or related documentation and shall refund a part or all of the license and service fees paid for the timeframe that the Software failed to substantially perform starting from the date of Customer s written notice. 8

10 Critical Terms and Conditions Deadlines/Paid upon Performance Insurance and Indemnification Intellectual Property Data Security and Return Contingency Plan Regulatory Compliance Term and Termination HIPAA Security Standards Electronic Protected Health Information (ephi) Flexibility: Required vs. Addressable Administrative Safeguards o Security Management and Incident Process o Information Access Management o Security Awareness and Training o Contingency and Evaluation Plan o Complaints and Sanctions Physical Safeguards o Facility Access Controls o Workstation Use and Security o Device and Media Controls Technical Safeguards o Access and Audit Controls o Person or Entity Authentication o Integrity and Transmission Security 9

11 Business Associate Agreement Business Associate Agreement o If in place prior to February 1, 2013 Effective until September 23, 2014 o If entered into, renewed, or amended on or after February 1, 2013 Compliance Date: September 23, 2013 Amendments to Business Associate Agreement o Security Rule compliance only if ephi o Written Assurance of Subcontractor HIPAA compliance Business Associates Who and What is a Business Associate? o Electronic Health Records (EHR) Vendor o Health Information Exchange (HIE) o Accountable Care Organization (ACO) o Data Storage Services o Personal Health Records Services (CE) Interface (or Courier) Exception With a person or organization that acts merely as a conduit for protected health information, for example, the US Postal Service, certain private couriers, and their electronic equivalents. (HHS.gov) 10

12 Business Associate Agreement Reasonable and Permissible Uses Subcontractor Approval Security Incident Reporting Breach Reporting Risk Assessment Mitigation Notification Encryption Indemnification Insurance Audit Important Dates Medicare Medicaid January 2011: Registration begins May 2011: EHR Incentive Payments begin November 30, 2011: Last day for EHs and CAHs to Attest to receive incentive payment FY 2011 January 2011: Registration begins May 2011: EHR Incentive Payments begin February 29, 2012: Last day for EHs and CAHs to Attest to receive incentive payment FY : Last year to begin participation 2016: Last year to begin participation 2015: Payment adjustments for EPs that are not MU of EHR technology 2021: Last year to receive EHR incentive payment 2016: Last year to receive EHR incentive payment 11

13 Payment Adjustments to EPs Beginning in 2015 Medicare Reduced Physician Fee Schedule Payments o % o % o 2017 (after) 97% Attestation Deadlines o July 1, 2014 (EHs) o October 1, 2014 (EPs) 2018 Goal 75% MU o 1% each year until 95% Hardship Exceptions o Annual Renewal o No more than 5 years Medicaid None Dual eligible EPs must submit attestations to State Medicaid Agencies to avoid penalty Meaningful Use Stage One Objectives Medicare EPs 15 Core Objectives 5 Menu Set Objectives (10) 6 Clinical Quality Measures o 3 Core or Alternate Core o 3 from Additional Set (38) Medicare EHs 14 Core Objectives 5 Menu Set Objectives (10) 15 Clinical Quality Measures Exclusions Exclusions 12

14 Meaningful Use Stage Two Objectives Eligible Professionals 17 Core Objectives 3 Menu Set Objectives (6) 9 Clinical Quality Measures o 3 of 6 health care policy o 6 from Total Set (64) 2014 Calendar Year o 3 month Medicare only o Electronically report CQMs Changes to Stage One o Core Objectives o Hospital-Based EPs Eligible Hospitals and CAHs 16 Core Objectives 3 Menu Set Objectives (6) 16 CQMs o 3 of 6 health care policy o 13 from Total Set (29) 2014 Fiscal Year o 3 month Medicare only o Electronically report CQMs Changes to Stage One o Core Objectives o Hospital-Based EPs Meaningful Use Stage Two EPs Core Objectives Eligible Professionals must meet All 17 Core Objectives: Core Objective Measure 1. CPOE Use CPOE for more than 60% of medication, 30% of laboratory, and 30% of radiology 2. E-Rx E-Rx for more than 50% 3. Demographics Record demographics for more than 80% 4. Vital Signs Record vital signs for more than 80% 5. Smoking Status Record smoking status for more than 80% 6. Interventions Implement 5 clinical decision support interventions + drug/drug and drug/allergy 7. Labs Incorporate lab results for more than 55% 8. Patient List Generate patient list by specific condition 9. Preventive Reminders Use EHR to identify and provide reminders for preventive/follow-up care for more than 10% of patients with two or more office visits in 2 years 13

15 Meaningful Use Stage Two EPs Core Objectives Core Objective Measure 10. Patient Access Provide online access to health information for more than 50% with more than 5% actually accessing 11. Visit Summaries Provide office visit summaries more than 50% of visits 12. Education Resources Use EHR to identify and provide education resources more than 10% 13. Secure Electronic Messages More than 5% of patients send secure messages to EP 14. Rx Reconciliation Medication reconciliation at more than 50% of transitions of care 15. Electronic Exchange Provide summary of care document for more than 50% of transitions of care and referrals with 10% sent electronically and at least ONE sent to a recipient with a different EHR vendor or successful test with CMS 16. Immunizations Successful ongoing transmission of immunization data 17. Security Analysis Conduct or review security analysis and incorporate in risk management process Meaningful Use Stage Two EPs Menu Set Objectives Eligible Professionals must select 3 of 6 Menu Objective Measure 1. Imaging Results More than 20% of imaging results are accessible through Certified EHR Technology 2. Family Health History Record family health history for more than 20% 3. Syndromic Surveillance Successful ongoing transmission of syndromic surveillance data to public health agencies 4. State Cancer Registry Successful ongoing transmission of cancer case information to a State cancer registry 5. Specialized Registry Successful ongoing transmission of data to a specialized registry (other than cancer) 6. Progress Notes Enter an electronic progress note in patient record for more than 30% of unique patients 14

16 Meaningful Use Stage Two EHs Core Objectives Eligible Hospitals must meet All 16 Core Objectives: Core Objective Measure 1. CPOE Use CPOE for more than 60% of medication, 30% of laboratory, and 30% of radiology 2. Demographics Record demographics for more than 80% 3. Vital Signs Record vital signs for more than 80% 4. Smoking Status Record smoking status for more than 80% 5. Interventions Implement 5 clinical decision support interventions + drug/drug and drug/allergy 6. Labs Incorporate lab results for more than 55% 7. Patient List Generate patient list by specific condition 8. Electronic Medication Administration Record (emar) emar is implemented and used for more than 10% of medication orders to automatically track order Meaningful Use Stage Two EHs Core Objectives Core Objective Measure 9. Patient Access Provide online access to health information for more than 50% with more than 5% actually accessing 10. Education Resources Use EHR to identify and provide education resources more than 10% 11. Rx Reconciliation Medication reconciliation at more than 50% of transitions of care 12. Summary of Care Provide summary of care document for more than 50% of transitions of care and referrals with 10% sent electronically and at least one sent to a recipient with a different EHR vendor or successfully testing with CMS 13. Immunizations Successful ongoing transmission of immunization data 14. Outpatient Labs Reporting Successful ongoing submission of reportable laboratory results 15. Syndromic Surveillance Successful ongoing submission of electronic syndromic surveillance data 16. Security Analysis Conduct or review security analysis and incorporate in risk management process 15

17 Meaningful Use Stage Two EHs Menu Set Objectives Eligible Hospitals must select 3 of 6 Menu Objective Measure 1. Imaging Results More than 20% of imaging results are accessible through Certified EHR Technology 2. Family Health History Record family health history for more than 20% 3. Progress Notes Enter an electronic progress note in patient record for more than 30% of unique patients 4. Advance Directives Record whether patient 65 years old or older has an advance directive 5. erx Generate and transmit permissible discharge prescriptions electronically 6. Lab Provide structured electronic lab results to ambulatory providers Medicare EPs Incentive Program Meaningful EHR User Calendar Year Incentive Payment Maximum Medicare Incentive Payment If 1st year of meaningful EHR use: If 2nd year of meaningful EHR use: If 3rd year of meaningful EHR use: If 4th year of meaningful EHR use: If 5th year of meaningful EHR use: 2011 or 2012 $18,000 $44, $15,000 $39, $12,000 $24, or after $0 $0 2012, 2013 or 2014 $12, $8, or after $0 2013, 2014 or 2015 $8, $4, or after $0 2014, 2015 or 2016 $4, or after $ or 2016 $2, or after $0 16

18 Medicaid EPs Incentive Program Medicaid EP Qualifies Medicaid EP Qualifies Medicaid EP Qualifies Medicaid EP Qualifies Medicaid EP Qualifies Medicaid EP Qualifies First in 2011 First in 2012 First in 2013 First in 2014 First in 2015 First in 2016 Payment Amount in 2011 $21, $0.00 $0.00 $0.00 $0.00 $0.00 Payment Amount in 2012 $8, $21, $0.00 $0.00 $0.00 $0.00 Payment Amount in 2013 $8, $8, $21, $0.00 $0.00 $0.00 Payment Amount in 2014 $8, $8, $8, $21, $0.00 $0.00 Payment Amount in 2015 $8, $8, $8, $8, $21, $0.00 Payment Amount in 2016 $8, $8, $8, $8, $8, $21, Payment Amount in 2017 $0.00 $8, $8, $8, $8, $8, Payment Amount in 2018 $0.00 $0.00 $8, $8, $8, $8, Payment Amount in 2019 $0.00 $0.00 $0.00 $8, $8, $8, Payment Amount in 2020 $0.00 $0.00 $0.00 $0.00 $8, $8, Payment Amount in 2021 $0.00 $0.00 $0.00 $0.00 $0.00 $8, TOTAL Incentive Payments $63, $63, $63, $63, $63, $63, Meaningful Use Amended Time Line 1st Year Stage of Meaningful Use TBD TBD TBD TBD TBD TBD TBD TBD TBD TBD TBD TBD TBD TBD

19 @ccdunhamiv linkedin.com/in/charlesdunhamhealthcarelawyer/ 35 The information in this presentation is intended as general background information on health care and business law. It is not to be considered as legal advice. Health Care law changes often and information becomes rapidly outdated. All rights reserved. This presentation may not be reprinted or duplicated in any form, without the express written authorization of Charles C. Dunham, Esq

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