Proposed rule extends EHR safe harbor provision

Following some congressional pressure, the Centers for Medicare & Medicaid Services (CMS) is releasing a proposed rule (CMS-1454-P) to extend the Dec. 31, 2013 deadline of the safe harbor provision, which allows the donation of EHRs and other services to qualified entities, to Dec. 31, 2016.

The proposal, slated for publication in the April 10 Federal Register, also would update certain aspects of the EHR extension--including limiting the scope of qualified recipients of donations and modifying conditions to limit the risk of data and referral lock-in. The Office of Inspector General is publishing a similar rule in the same issue.

The proposal comes less than two weeks after Rep. Jim McDermott (D-Wash.), ranking member of the Ways and Means Health Subcommittee, urged expeditious action to renew the provision in a March 28 letter (see story).

In 2006, CMS and the OIG created the safe harbor to allow certain entities to take advantage of nonmonetary remuneration from hospitals for the purpose of setting up or improving EHR systems. The purpose was to incentivize the meaningful use of EHR systems.

According to the current provisions of the EHR safe harbor provision, “software is deemed to be interoperable if a certifying body recognized by the secretary has certified the software no more than 12 months prior to the date it is provided to the physician.”

The April proposal would update the provision to reflect the current Office of the National Coordinator for Health IT (ONC) certification program as the certifying body for the EHR technology. Moreover, the requirement that the EHRs must be certified within 12 months of the donation has been eliminated and instead entities must adhere to the ONC framework.

Additionally, the proposal removes the electronic prescribing capability requirement for the donated EHR software. The proposal states that the HITECH Act, which requires Meaningful Use of EHRs, including electronic prescribing, and general industry progress in adopting the technology, renders the requirement unnecessary.

“We are considering excluding suppliers of ancillary services associated with a high risk of fraud and abuse, because the donations by such suppliers may be more likely to be motivated by a purpose of securing future business than by a purpose of better coordinating care for beneficiaries across health care settings,” according to the rule. Laboratory companies, durable medical equipment suppliers and independent home health agencies all are being considered excluded from the provision.