Extension of and Modification to Regulatory Protections for Donated EHR

by Saul Ewing Arnstein & Lehr LLP


In the December 27, 2013 edition of the Federal Register, the Office of Inspector General (“OIG”) and Centers for Medicare and Medicaid Services (“CMS”), both within the U.S. Department of Health and Human Services (“HHS”), released substantially similar final rules regarding the donation of electronic health records (“EHR”) software and services (78 Fed. Reg. 78751 and 79202, respectively, and collectively, the “Final Rules”). The Final Rules amend the then-final regulations that were published in the Federal Register on August 8, 2006.

The Final Rules among other things: (i) extend the protections for EHR donations until December 31, 2021; (ii) prohibit laboratories from being a donor of EHR software and services; and, (iii) clarify when EHR software is deemed interoperable.

The proposed regulations that resulted in the adoption of the Final Rules were the subject of an earlier Saul Ewing alert.

The donation of EHR is protected as an exception to the Physician Self-Referral Statute (commonly known as the “Stark Law”), which is enforced by CMS, and by a safe harbor to the federal Anti-Kickback Statute, which is enforced by the OIG, provided certain conditions are met in the exception and the safe harbor. Before publication of the Final Rules, these regulatory protections were set to expire on December 31, 2013.

One significant change in the Final Rules is that laboratories are now specifically excluded from the types of entities that may donate EHR items and services. In the preambles to the respective Final Rules, the regulators noted that commenters had raised concerns that laboratory companies were explicitly or implicitly conditioning donations of EHR items and services on the receipt of referrals from the recipients. The regulators addressed these concerns in the Final Rules.

Another modification in the Final Rules is the standard by which EHR is deemed to be interoperable. Interoperable is defined in 42 CFR 411.351 as “… able to communicate and exchange data accurately, effectively, securely, and consistently with different information technology systems, software applications, and networks, in various settings; and exchange data such that the clinical or operational purpose and meaning of the data are preserved and unaltered.” In the Final Rules, the organization that deems interoperability of EHR is the Office of the National Coordinator for Health Information Technology (“ONC”), rather than the HHS Secretary in the current regulations. Further, the EHR software is deemed interoperable if, on the date it is provided to the physician, it has been certified as such by an ONC-approved body in accordance with the ONC’s most recently published regulatory criteria. The current regulations require the donated software to be certified no more than 12 months prior to the date of donation.

In the Final Rules, EHR is no longer required to have electronic prescribing capabilities. While noting the importance of electronic prescribing, the regulators stated their belief that other existing policies sufficiently support the adoption of electronic prescribing.

The Final Rules add clarity to the current language that prohibits donors (or anyone on their behalf) from limiting or restricting the “use, compatibility, or interoperability” of the donated EHR items or services with other electronic prescribing or EHR systems. The Final Rules add a parenthetical that such other EHR systems could include, but not be limited to, “health information technology applications, products or services.” The additional language is, according to the regulators, intended to prohibit donors’ actions that limit the use, compatibility or interoperability of donated items or services with any other health information technology.

There are still many providers that have not adopted or effectively utilized EHR technology. The Final Rules extend for eight years the ability for providers to benefit from the receipt of EHR donations conditioned upon compliance with the Stark Law exception. Compliance with the Anti-Kickback Statute EHR safe harbor causes an arrangement to be immune from prosecution.1 The Final Rules are effective March 27, 2014, except that the change of the “sunset date” to December 31, 2021 was effective December 31, 2013.

  1. Compliance with the Anti-Kickback Statute EHR safe harbor causes an arrangement to be immune from prosecution. Failure to comply with a safe harbor under the Anti-Kickback Statute is not, however, fatal to the transaction. Rather, such an arrangement would be evaluated on a “facts and circumstances” basis.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Saul Ewing Arnstein & Lehr LLP | Attorney Advertising

Written by:

Saul Ewing Arnstein & Lehr LLP

Saul Ewing Arnstein & Lehr LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.