Congress to Decide Whether to Expand Health-IT Safe Harbors

Congress will decide in September whether to expand the safe harbors for physicians receiving health information technology that were announced in August by the Department of Health and Human Services (HHS). The two, parallel final rules issued by HHS establish two categories of technology -- one limited to e-prescribing, the other for any office management software -- where physicians can accept hardware and software gratis from providers such as hospitals, pharmacy benefit managers, and other providers. The final rules expand current safe harbors under the Stark anti-self referral and office of inspector general anti-kickback rules, which are meant to prevent physicians from accepting gifts that are a quid pro quo for providing referrals.

The HHS rules have conditions attached to both categories of IT, which in both cases have to be interoperable, which means they are certified by the Certification Commission for Healthcare IT. With regard to the office management software category, physicians must pay 15 percent of the value of any gifts they receive.

But the Health Information Technology Promotion Act of 2006 (H.R. 4157) passed by the House by a vote of 270-148 on July 27 would allow physicians to receive all categories of health IT with none of the limitations in the HHS final rules. It authorizes $30 million in grants for physicians who buy health-IT hardware and software.

The problem is that the bill must be reconciled with a Senate bill that differs considerably. The Wired for Health Care Quality Act (S. 1418) passed in November 2005 with strong bipartisan support. It authorizes $600 million in grants but does not address the anti-self referral and anti-kickback safe harbors, much less expand them. Matthew Fenwick, spokesman for the American Hospital Association, says his group greatly prefers the House bill because it contains safe harbor provisions.

But political flak has hit the House bill from both directions, from the Bush administration and Democrats in Congress. Michael Leavitt, secretary of HHS, criticized the House bill for lacking the requirement for CCHIT certification of donated systems. Rep. Frank Pallone (D-N.J.) criticized the House bill because it only authorizes $30 million in grants, leading him to describe it as "a lemon."

Charles Safran, M.D., associate clinical professor of medicine at Harvard Medical School, Beth Israel Deaconess Medical Center, says the HHS safe harbor expansions will help hospitals and physicians in metropolitan areas. That is because large hospitals have the technical resources and personnel to help physicians in their communities wire their offices. He adds, though, "Unfortunately, adoption of EHRs in rural and poorer communities will probably not be helped by these regulatory changes." Safran is immediate-past chairman of the American Medical Informatics Association.
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