Kusserow on Compliance: OIG warns blocking EHR may be a kickback

As part of the National Health IT Week 2015, the HHS Office of Inspector General (OIG) issued a new Alert entitled “OIG Policy Reminder: Information Blocking and the Federal Anti-Kickback Statute.” In this Alert, the agency notes its long support of the adoption of electronic health record (EHR) technology.

Health information technology (IT) has been characterized as a critical part of the health care system and offers opportunities to improve patient care, make practice management more efficient, and improve public health. The OIG created the EHR safe harbor to the federal Anti-Kickback Statute (AKS) for certain arrangements involving donations of EHR items and services to potential referral sources. This safe harbor is intended “to protect beneficial arrangements that would eliminate perceived barriers to the adoption of EHR without creating undue risk that the arrangements might be used to induce or reward the generation of [federal health care program] business” (Final rule, 71 FR 45110, August 8, 2006). Donations that fit squarely within all of the EHR safe harbor’s conditions are not subject to sanctions under the AKS. However, the OIG has made clear that they are committed to investigating potentially abusive donation arrangements that purport to meet the safe harbor conditions, but, in fact, do not.

In the Alert, the OIG explains that “information blocking” places entities outside the EHR safe harbor, may implicate the AKS, and result in OIG investigation and prosecution. Such blocking impedes the appropriate flow of information across the care continuum and can undermine the benefits offered by health IT. If a donor, or someone on the donor’s behalf, takes any action to limit or restrict the use, compatibility, or interoperability of the donated items or services with other electronic prescribing or EHR systems, the donation arrangement would not receive safe harbor protection and would be suspect under the AKS.

The new OIG Alert includes examples of this type of concerning conduct, including cases where a provider, such as a hospital, may seek to furnish software or information technology to an existing or potential referral source, such as a physician practice. This kind of arrangement potentially implicates the AKS statute because the software or information technology is potential remuneration to the referral source. Arrangements involving the provision of software or information technology to a referral source should be scrutinized for compliance with the AKS. The safe harbor protects certain arrangements involving the provision of interoperable EHR software or information technology and training services.

The OIG noted that arrangements in which a donor takes an action to limit the use, communication, or interoperability of donated items or services by entering into an agreement with a recipient to preclude or inhibit any competitor from interfacing with the donated system would not satisfy the safe harbor requirements. Furthermore, arrangements in which EHR technology vendors agree with donors to charge high interface fees to non-recipient providers or suppliers or to competitors may also fail to satisfy the conditions of the safe harbor. These examples could be viewed as implicating the AKS and result in an investigation.

The Alert underscores the continued belief by the OIG that “any action taken by a donor (or any person on behalf of the donor, including the [EHR] vendor or the recipient) to limit the use of the donated items or services by charging fees to deter non-recipient providers and suppliers and the donor’s competitors from interfacing with the donated items or services would pose legitimate concerns that parties were improperly locking-in data and referrals and that the arrangement in question would not qualify for safe harbor protection.” The Alert ends with a call for anyone having information about arrangements that potentially violate the AKS to contact the OIG.

Richard P. Kusserow served as DHHS Inspector General for 11 years. He currently is CEO of Strategic Management Services, LLC (SM), a firm that has assisted more than 3,000 organizations and entities with compliance related matters. The SM sister company, CRC, provides a wide range of compliance tools including sanction-screening.

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Copyright © 2015 Strategic Management Services, LLC. Published with permission.