CMS and OIG release final rules extending Stark Law exception for donations of EHR systems

Carlton Fields & Jon Gatto | Lexology | December 26, 2013

In 2006, the Centers for Medicare & Medicaid Services ("CMS") and the Office of Inspector General of the Department of Health and Human Services (the "OIG") published final rules providing for an exception to the Stark Law and a safe harbor under the Anti-Kickback Statute for donations of electronic health records ("EHR") technology to physicians. Those final rules were part of an effort by the federal government to encourage the use of EHR technology by alleviating the significant costs of implementing and operating such technology. The final rules allowed health care entities to donate up to 85% of the cost of EHR technology to physicians under specified circumstances.

The 2006 final rules included a December 31, 2013, sunset provision for the Stark Law exception and the Anti-Kickback safe harbor for donations of EHR technology. Had those provisions been allowed to sunset, physicians would have had to pay fair market value for EHR-related items and services, which would have resulted in a dramatic increase in the cost to physicians of using EHR technology and presumably a corresponding decrease in the willingness of physicians to use such technology.

Instead, on December 23, 2013, CMS and the OIG released new final rules, to be published in the Federal Register on December 27, 2013, extending the sunset date to December 31, 2021...