"Lab Compliance Update"

Tennessee AG Opinion Adds Unease to EHR Donation Issue

Based on state law, opinion is uncannily similar to an opinion issued in 2012 by the Washington State AG

ANOTHER STATE ATTORNEY GENERAL (AG) has issued an opinion on the donations of electronic health record (EHR) systems by clinical laboratories to referring physicians. The opinion says that such donations would violate Tennessee state law.

The Tennessee AG’s opinion is similar to one issued in November in Washington State by its attorney general. Each of these state opinions is likely to cause confusion for labs because federal law allows donations by providers—including clinical laboratories—intended to help referring physicians acquire EHR systems.

On March 4, Tennessee Attorney General Robert E. Cooper, Jr., wrote that the Tennessee Medical Laboratory Act prohibits anyone from soliciting the referral of specimens to a medical laboratory or contracting to perform medical laboratory examinations of specimens in a way that “offers or implies an offer of rebates.”

Violation of State Law

“This provision would prohibit a licensed medical laboratory from making any monetary donation to a physician to cover the cost of software designed to manage the physician’s electronic health records when the physician’s office that receives the EHR donation either continues an existing referral arrangement with the donating laboratory or subsequently initiates an arrangement for referral of specimens to the donating laboratory for analysis,” Cooper wrote.

The Tennessee opinion is similar to one issued on November 12, 2012, by the former Washington state Attorney General Rob McKenna. In his opinion, Cooper referenced that opinion, writing, “See also Washington Attorney General. Op. 7, 2012 WL 7148193…(Nov. 20, 2012) (reaching same conclusion in finding that Washington’s anti-kickback provisions were not preempted by federal law).” The opinions by both state AGs also refer to “monetary donations” or “donating money.”

Comments by Lab Attorney

Earlier, in response to the Washington AG’s opinion, THE DARK REPORT inter- viewed attorney David W. Gee of Garvey Schubert Barer in Seattle. He stated, “It’s hard to understand why the [Washington State] Attorney General would take the view that donating EHR software is illegal because that position directly undermines the federal government’s statutory efforts to promote physicians’ electronic health information connectivity. Likewise, the AG’s opinion talks about a ‘cash donation’, but the EHR software donation permitted by the federal laws does not contemplate monetary donation to a physician.”

Both opinions are online. Tennessee’s is located at: http://tinyurl.com/d6atcxy. Washington state’s AG opinion is at: http://tinyurl.com/cq9d7v5. Lab administrators are advised to review their state laws on the subject of EHR donations to referring physicians.

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