Stark Safe Harbor and Anti-Kickback Statute Exception. E-Prescribing and Electronic health Records Systems
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1 Stark Safe Harbr and Anti-Kickback Statute Exceptin E-Prescribing and Electrnic health Recrds Systems Prpsed Rules fr Dnatin t Physicians and Prescribers August 3, 2006 Executive Summary The fllwing summarizes the final rules published August, 2006, t establish exceptins and safe harbrs t the Anti-Kickback Statute and the Stark Law respectively fr the adptin f healthcare IT: Under the Medicare Mdernizatin Act f 2003, Cngress directed the Secretary f Health and Human Services t develp safe harbrs t prmte healthcare IT adptin by physicians in supprt f e-prescribing The Secretary has furthered this mandate t extend t the adptin f electrnic health recrds Bth rules cntain tw safe harbrs Fr dnatin f hardware, sftware, training and supprt necessary t implement an e-prescribing system Fr dnatin f sftware and training and ther IT services necessary t implement an electrnic health recrd system Fr the e-prescribing system, any dnated systems must cmply with the use f fundatin standards adpted by the Secretary fr e-prescribing (NCPDP under the E-Prescribing final rule and subsequent rule making Fr the electrnic health recrd system safe harbrs, any dnated systems must be interperable If certificatin standards have been recgnized by the Secretary as f the time f dnatin, the system must be certified t be deemed interperable If certificatin standards d nt exist at the time f dnatin, the system still must be deemed interperable t qualify fr the safe harbr The certificatin standards are nt the subject f the final safe harbr rules but fr example likely include the criteria adpted fr certificatin by the Certificatin Cmmissin n Healthcare IT (CCHIT) An acknwledged gal f creating the EHR safe harbr is t prmte the plicy gal f prvider adptin f pen, intercnnected interperable EHR systems Fr the electrnic health recrd system, a cre functin f the system must be e- prescribing
2 Fr the electrnic health recrd system, integrated practice management functins may be cmpnents f the system as lng as its primary cre purpse is t prvide an electrnic health recrd A standalne practice management system wuld nt qualify fr the electrnic health recrd system safe harbr Dnrs can be Fr e-prescribing slutins Hspitals t their medical staffs Grup practices t their members PDPs r MA rganizatins t netwrk pharmacies/cists and prescribers Fr electrnic health recrds systems Any individual r entity that prvides cvered health services and bills fr such services t Federal healthcare prgrams Health Plans Recipients can be Fr e-prescribing slutins Any physician r prescriber wh is part f a medical staff, a member f a grup practice r a member f a netwrk panel fr a PDP r MA rganizatin Fr electrnic health recrds systems Any individual r entity wh delivers health services The dnatin must be necessary t the recipient in that it may nt exactly duplicate smething already in use by the recipient The dnatin may be a different and new technlgy t perfrm a functin the recipient already has autmated (e.g. the dnatin may be f handheld cmputers if the recipient is nly using fixed wrkstatins) The dnatin cannt be pen ended and duplicative t what is already being dnated it is intended t fcus n the start up and adptin phase The dnated technlgy may be used fr the benefit f all patients served by the recipient As t the value f the dnatin Fr e-prescribing n limit n the value was included Fr electrnic health recrds systems the recipient must pay fr 15% f the ttal value f the dnated system The dnr cannt prvide funding t the recipient t pay fr the 15% share f the ttal cst f the dnated system Intrductin and Backgrund The purpse f this white paper is t summarize key aspects f the final rules fr establishing regulatry safe harbrs fr hspitals and ther rganizatins t dnate healthcare IT t physicians and ther prviders fr the purpse f prmting the adptin f IT in supprt f e-prescribing activities and the implementatin f electrnic health recrds systems.
3 On Octber 11, 2005, the Office f the Inspectr General (OIG) fr the U.S. Department f Health and Human Services (DHHS) and the Center fr Medicare and Medicaid Services (CMS) simultaneusly published prpsed rules fr the establishment f an exceptin t the Anti-Kickback Statute and the Stark Law n physician self referrals respectively. These rules were finalized n August 1, As a reminder, the Anti-Kickback Statute prhibits any prvider f designated health services subject t reimbursement by federally funded health prgrams frm receiving a mnetary r nn-mnetary bribe, inducement, kickback r ther frm f illegal cmpensatin in exchange fr making referrals. The Stark Law prhibits material physician wnership r receipt f mnetary r nn-mnetary cmpensatin in exchange fr making referrals t an entity in which the physician has a material financial interest. Under bth laws, there are safe harbrs r exceptins defined t allw certain arrangements r practices t exist that d nt vilate the respective laws. Fr example, the mst bvius exceptin is emplyment under which a physician is paid by the prvider. Wages paid fr emplyment are excepted frm classificatin as a mnetary inducement that wuld vilate the laws. Under the Medicare Mdernizatin Act f 2003 (MMA 2003), Cngress made prvisin fr the OIG and fr CMS t establish exceptins r safe harbrs under bth laws t allw fr the dnatin f healthcare IT (hardware, sftware and training) t physicians t be able t perfrm e-prescribing using standard transactins fr e-prescribing defined under rule making by the Secretary f DHHS. Additinally, bth the OIG and CMS saw fit t additinally develp safe harbrs fr dnatin f healthcare IT t individuals and entities invlved in prviding health services prviders fr the purpse f implementing electrnic health recrds systems as lng as a majr functin f the EHR system was e- prescribing. Cmparisn f the Final Rules The OIG and CMS cllabrated t wrk t ensure that the final rules were very similar in nature. One key difference t keep in mind is that the Anti-Kickback Statute is cncerned with prviders f all types while the Stark Law is cncerned with physicians s that makes difference as t the breadth f applicability f the safe harbrs. Bth final rules utline tw scpes f safe harbr that reflect the degree f healthcare IT t be adpted and when. The prgressin is as fllws: The adptin f e-prescribing slutins The adptin f electrnic health recrds that have been certified t be interperable accrding t certificatin standards recgnized by the Secretary f HHS Final Rule Prvisin Anti-Kickback Exceptin Stark Safe Harbr Electrnic Prescribing N expiratin date N expiratin date
4 Safe Harbr Cvered Technlgy Standards with Which Dnated Technlgy Must Cmply Limits n Dnatin Permissible Dnrs Items and services used slely t transmit and receive electrnic prescriptin drug inf Slely means electrnic tls that prvide infrmatin necessary t frmulate, transmit r receive a medically apprpriate prescriptin Includes hardware, sftware, internet cnnectivity, training and supprt services Prescriptin includes nt nly drugs but anything nrmally subject t a written prescriptin by a licensed prvider including medical supplies, medical equipment, labratry prcedures and similar types f items that require such a written prescriptin Beynd the bvius, sftware includes clinical supprt tls identifying alternative drug therapies, drug t drug interactin checking r a payer s frmulary infrmatin Fundatin standards fr e- prescribing as adpted by Secretary f DHHS under Dnatin may nt be duplicative f systems r equipment already in use fr the same purpse by the recipient Hspitals t their medical staff Grup Practices t their Fundatin standards fr e- prescribing as adpted by Secretary f DHHS under
5 Selectin f Recipients Value f Prtected Technlgy (Dnatin Cap) Electrnic Health Recrds Safe Harbr Cvered Technlgy members PDP Spnsrs and Medicare Advantage rganizatins t netwrk pharmacies/cists and prescribers Dnrs may nt take int accunt vlume r value f referrals with recipient N limit n the value f the dnated system Expiratin Date f 12/31/2013 Sftware used predminantly t transmit, maintain and receive electrnic health infrmatin Predminantly means that the sftware primarily serves the purpse f an EHR but the system may als supprt ther healthcare administrative functins such as scheduling, registratin, billing r practice management IF such functins are integrated int the EHR system Standalne administrative r practice management systems are NOT included as eligible fr the safe harbr Training services Sftware must include an electrnic prescribing cmpnent which may be satisfied thrugh interfacing with a related system that perfrms e-prescribing activity Dnated technlgy may include EHR sftware licenses, rights and Expiratin Date f 12/31/2013
6 Standards with Which Dnated Technlgy Must Cmply Permissible Dnrs intellectual prperty, cnnectivity services (including internet and wireless services), clinical supprt tls and services, maintenance, secure messaging and supprt Dnated technlgy des nt include hardware/os, strage, sftware with cre functins ther than as an EHR system (e.g. standalne practice management) Dnated technlgy must be certified as interperable effective within 12 mnths prir t the date f dnatin accrding t standards develped by a certifying bdy recgnized by the Secretary (e.g. CCHIT) Interperable means that as f the time f the sftware dnatin, the sftware is able t (i) cmmunicate and exchange data accurately, effectively, securely and cnsistently with different IT systems and sftware applicatins r netwrks in varius settings bth internal t and external t the recipient s cntext and (ii) exchange data such that the clinical r peratinal purpse and meaning f data are preserved and unaltered Fundatin standards fr e- prescribing as adpted by Secretary f DHHS under Any individual r entity prviding a cvered health Fundatin standards fr e- prescribing as adpted by Secretary f DHHS under Any entity that furnishes cvered health services t a
7 Permissible Recipient Selectin f Recipients Value f Prtected Technlgy (Dnatin Cap) service and billing fr such services t a Federal healthcare prgram Health Plans Any individual r entity invlved in prviding health services as fr e-prescribing safe harbr prpsed abve Recipient must pay fr 15% f the ttal cst f the dnated technlgy and the dnr may nt lan mney r fund the recipient s prtin physician Physicians
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