With the relaxation of the Stark regulations, many of Hayes’ clients have begun to explore ways to provide IT-related services that had not been previously possible. This group of Hayes’ clients includes insurance companies, large group practices, medical service organizations (MSOs) and hospitals. The overall objective is to improve patient care through better coordination of information.

Some examples of clients’ projects include:

• A large insurance company (>50% of the non-governmental market) which has begun to offer physicians a $5,000 allotment to assist them in purchasing an EHR. This insurance company is also offering a 1-2% differential for those physicians who have successfully moved onto a certified EHR platform. This is part of a trend for insurance companies to help deflect the cost to physicians for their adoption of an EHR.

• A large MSO on the west coast which is rolling out their EHR to physicians in hopes that they will sign an affiliation agreement. Once the new practices are up and running on the EHR, the MSO will allow them to participate in their enhanced (higher reimbursement) contracts with payers.

• Several hospital clients who have purchased master licenses for EHR products and are offering to host the applications to reduce the barriers for smaller physician practices to purchase and utilize an EHR.

• A major national reference lab company which is providing financial support to a coalition of providers (hospitals and physicians) so that they may optimize the value of their move onto an EHR by helping to pay for the necessary interface between the lab and the EHR.

Many parties benefit from the relaxation of Stark regulations. The organizations offering services such as an EHR reap the benefits of an enhanced relationship with physicians and the likelihood of increased admissions and utilization of other hospital services. Also, since an auto-populated EHR is preferable by clinical staff to transcription and paper processes, recruitment and retention is increased.

Physician practices benefit from useful technology that is subsidized at up to 85% of its total cost. Hayes has worked with multiple physician practices to help ensure that they would save money from process improvements inherent in an EHR. Increased efficiency and accuracy usually bring about cost savings. Additionally, with better access to data, practices are better prepared to participate in insurance programs such as Pay for Performance.

Organizations interested in pursuing IT donation activities are advised to first seek legal counsel. There are very specific stipulations and limits to what an entity can provide across organizational boundaries. The following are some examples of these limitations:*

• Physician cannot be selected by the volume or value of referrals or other business generated between the parties.
• Donations cannot be provided to organizations already using equivalent technology.
• Physicians can be selected on:
• # prescriptions generated
• practice size
• physician's overall use of automated technology
• whether the physician is a member of the donor's medical staff
• level of uncompensated care provided by the physician

Hayes’ role has been to assist clients to redesign effective workflows, re-engineer business processes, assist with system selection and implementation, provide a readiness assessment for the practice and provide training for staff and physicians. Therefore, if you plan to take advantage of the Stark relaxation, we would be happy to help.

*Disclaimer: Hayes does not provide legal services. This information does not in any way substitute for legal counsel.

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