CMS and OIG Propose Changes to the Electronic Health Record Services Stark Exception and Anti-Kickback Safe Harbor

May 31, 2013

Recently, the Center for Medicare & Medicaid Services (“CMS”) and the Health and Human Services Office of Inspector General (“OIG”) published proposed rules that if enacted would modify certain aspects of the electronic health records Stark Law exception and Anti-Kickback safe harbor by extending its sunset date.[1] 

 The proposed rules would extend the December 31, 2013 sunset provision of the exception and safe harbor for the donation of eligible electronic health record items and services to December 31, 2016.  The agencies noted that although the health care industry has increased its use of electronic health record systems, these systems have not been universally adopted.  The selected date corresponds with the last year in which one can receive Medicare electronic health record incentive payments and the last year in which one may initiate participation in the Medicaid electronic health record incentive program.  As an alternative, CMS and the OIG are considering a later sunset date of December 31, 2021, which corresponds to the end of the Medicaid EHR Incentive Program.

Additionally, the proposed rules would amend the provision under which electronic health records software is deemed interoperable.  Under the current rules, EHR software is deemed interoperable if a certifying body recognized by the Secretary has certified the software 12 months prior to the date it is provided to the recipient.”[2]  The proposed rules would change the EHR certification requirements to be in line with the Office of National Coordinator for Health Information Technology’s (“ONC”) current authorization process.  ONC would be responsible for “recognizing” certifying bodies.  The rules recommended making the certification timeframe more flexible by deeming software eligible if, on the date provided to the recipient,  it has been certified to any edition of the electronic health record certification criteria maintained in the then-applicable definition of Certified EHR Technology in 45 CFR part 170.  This proposed change would be in line with the ONC’s transition to a two-year regulatory interval for certification standards. 

The proposed rules would also eliminate the requirements related to electronic prescribing capability.  Currently, donated software must “contain electronic prescribing capability, either through an electronic prescribing component or the ability to interface with the recipient’s existing electronic prescribing system that meets the applicable standards under Medicare Part D at the time the items and services are provided.”[3] The agencies recommended deleting this requirement because of changing regulations and industry standards that are sufficient to support the adoption of electronic prescribing technology. 

CMS and the OIG proposed restricting the scope of protected donors of EHR and adding or modifying conditions to limit the risk of data and referral lock-in.  Protected donors would include only the original Medicare Prescription Drug Improvement and Modernization Act of 2003 (“MMA”) mandated donors: hospitals, group practices, PDP sponsors, and MMA organizations.  The agency considered excluding laboratory companies from the scope of permissible donors. 

CMS and the OIG sought comments for suggested changes to fulfill the dual goals of preventing “the misuse of the exception in a way that results in data and referral lock-in,” and encouraging “the free exchange of data (in accordance with protections for privacy).”  

Although the proposed extension has not been finalized, it is clear that CMS and the OIG are hoping to encourage a more widespread adoption of electronic health record items and services.

[1] For a complete copy of the proposed rules please visit and

[2] 42 CFR 1001.952(y)(2) .

[3] 42 CFR 1001.952(y)(10).

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