Adoption of E-prescribing Technology

• Abstract
• Purpose of health policy or idea
• Characteristics of this policy
• Political and economic background
• Purpose and process analysis
• Expected outcome
• References

Featured in half-yearly report: G-politik in Industrieländern 7/8

Abstract

On October 11, 2005, the Office of Inspector General (OIG) and Centers for Medicare and Medicaid Services (CMS) released proposals to exempt from federal self-referral and anti-kickback legislation certain electronic prescribing (e-prescribing) and electronic health record (EHR) arrangements.

Purpose of health policy or idea

On October 11, 2005, the Office of Inspector General (OIG) and Centers for Medicare and Medicaid Services (CMS) released proposals to exempt from federal self-referral and anti-kickback legislation certain electronic prescribing (e-prescribing) and electronic health record (EHR) arrangements. 

The new regulations will reduce hurdles currently inhibiting the widespread adoption of e-prescribing technology by providers in a robust effort to improve quality, safety and efficiency of health care for Medicare beneficiaries and all American health care consumers.  (Ref. #1, #2)

Benefits of e-prescribing systems

E-prescribing systems have the potential to greatly reduce adverse pharmaceutical effects deriving from transcription, drug-drug interaction, allergies and dosage errors, to name a few.  Indeed, studies show significant improvements associated with e-prescribing implementation, including an 86% decrease in serious medication errors and an increase in Medicare formulary adherence from 14% to 88%. (#3)  Despite this evidence, however, providers have been slow to adopt e-prescribing technology due mainly to cost and regulatory constraints in the health industry.  According to the U.S. Department of Health and Human Services (HHS), while most industries spent $8,000 per worker for IT in the last decade, the health care industry invested only $1,000 per worker.  (#4) 

Regulatory hurdles inhibiting adoption of e-prescribing technology

Chief among regulatory hurdles are the Stark Law and the federal Anti-Kickback Statute, pieces of legislation intended to provide disincentives for providers to profit from referrals.  The Anti-Kickback Statute, first enacted by Congress in 1972, is a criminal statute that prohibits "any knowing or willful solicitation or acceptance of any type of remuneration to induce referrals for health services that are reimbursable by the Federal government."  By contrast, the Stark Law (more formally known as the federal physician self-referral law) is a civil statute introduced by California Congressman Pete Stark in 1989 that prevents a physician from referring a patient for certain designated health services to an entity with which the physician has an ownership interest or compensation arrangement if payments for the services furnished under the referral are to be made by Medicare or Medicaid. (#5) 

Expansions and revisions to physician self-referral and anti-kickback legislation over the last several decades have engendered a fair amount of confusion and controversy in the health care industry.  More recently, fear of criminal and civil penalties under the legislation has severely impeded upon the widespread adoption of e-prescribing technology by Medicare providers.  In response to these concerns, The Medicare Prescription Drug Improvement and Modernization Act (MMA) of 2003 calls for the removal of rules that could block third-party support of e-prescribing.  The move is intended to propel the U.S. Office of the National Coordinator for Health Information Technology's (ONCHIT) Framework for Strategic Action.  The Framework, issued in May 2004 by Secretary of HHS Tommy G. Thompson and newly appointed National Coordinator for HIT David J. Brailer, outlines a strategy for public-private collaboration in the establishment of a national HIT infrastructure.  Without revised self-referral and anti-kickback language, the Framework is implausible.

Elimination of regulatory barriers

OIG's proposed rule (70 Federal Register 59015) would establish a new safe harbor under the federal anti-kickback statute for certain arrangements involving the provision of e-prescribing technology and EHRs.  Specifically, the safe harbor would protect certain arrangements involving hospitals, group practices, and prescription drug plan (PDP) sponsors and Medicare Advantage (MA) organizations that provide to specified recipients certain nonmonetary remuneration in the form of hardware, software, and related training services necessary to receive and transmit electronic prescription drug information.  Meanwhile, the CMS proposed rule (70 Federal Register 59182) would create exceptions to the Stark Law by allowing hospitals and certain health care organizations to furnish hardware, software, and related training services to physicians, particularly where the support involves interoperable systems. (#6)

By eliminating regulatory barriers, the CMS and OIG proposals are consistent with the President's goal that most Americans have an EHR by the next decade.  If, as some experts suggest, e-prescribing is the "seed for the fundamental transformation of health care"(#7) in America, then its widespread adoption by providers would be the most significant step to date in the nation's HIT strategy.

Main points

Main objectives

The Office of Inspector General (OIG) and Centers for Medicare and Medicaid Services (CMS) intend to exempt from federal self-referral and anti-kickback legislation certain electronic prescribing (e-prescribing) and electronic health record (EHR) arrangements. 

Type of incentives

OIG would establish a new safe harbor under the Federal Anti-Kickback Statute for certain arrangements involving the provision of e-prescribing technology and EHRs.  Specifically, the safe harbor would protect certain arrangements involving hospitals, group practices, and prescription drug plan (PDP) sponsors and Medicare Advantage (MA) organizations that provide to specified recipients certain nonmonetary remuneration in the form of hardware, software, and related training services necessary to receive and transmit electronic prescription drug information.  

CMS would create exceptions to the Stark Law by allowing hospitals and certain health care organizations to furnish hardware, software, and related training services to physicians, particularly where the support involves interoperable systems.

Groups affected

Medicare beneficiaries and all other health care consumers, practicing clinicians, physician groups, medicare program

Innovationsgrad	traditionell		innovativ
Kontroversität	unumstritten		kontrovers
Strukturelle Wirkung	marginal		fundamental
Medienpräsenz	sehr gering		sehr hoch
Übertragbarkeit	sehr systemabhängig		systemneutral

This is an attempt to remove regulatory burdens to e-prescribing in order to improve quality and efficiency in the health care system.  It is crucial that efforts such as these continue to be made on behalf of Medicare patients and all Americans. 

Political and economic background

In a time of deep partisan divisions over a number of domestic policy issues, improvement of the U.S. health care system through a national HIT infrastructure is one issue that has gleaned support among Republicans and Democrats alike.  The notion for an interoperable HIT framework stems back to a concept paper called "Assuring a Health Dimension for the National Information Infrastructure," which was issued in 1998 by the National Committee on Vital and Health Statistics (NCVHS).  The committee, made up of private sector experts, reported that the nation's information infrastructure could be an essential tool for promoting the nation's health.

This set into motion a slew of initiatives by the federal government and private sector to foster the development of a national HIT framework.  Early examples include the Markle Foundation's public-private collaborative, Connecting for Health, which in early 2003 established an initial set of health care data standards and commitment for their adoption from national health care leaders.  Likewise, the Consolidated Health Informatics (CHI) initiative, headed by HHS, the Departments of Defense (DoD) and Veterans Affairs (VA), announced uniform standards for the electronic exchange of clinical health information to be adopted across the federal health care enterprise in March 2003. 

The Office of the National Coordinator for Health Information Technology's Framework for Strategic Action, released in 2004, reflects a culmination of the earlier e-health initiatives.  It relies heavily on the notions of foundation standards and interoperability, two themes which originated from language set forth in The Medicare Modernization Act of 2003.  Built upon its predecessors, the Framework set the stage for robust progress in the area of HIT in the U.S.

Since that time, legislators have recognized a policy landscape that is ripe for HIT legislation.  On November 18, 2005 the Senate unanimously passed the Wired for Health Care Quality Act (S. 1418), a bi-partisan bill introduced by Senators Bill Frist (Republican, Tennessee), Mike Enzi (Republican, Wyoming), Hillary Clinton (Democrat, New York), and Edward Kennedy (Democrat, Massachusetts).  The bill authorizes the appropriation of more than $280 million of funding for grants to facilitate the widespread adoption of certain HIT over the next two years, and addresses standards and interoperability through the establishment of an American Health Information Collaborative.  In addition, Representatives Nancy Johnson (Republican, Connecticut) and Wm. Lacy Clay (Democrat, Delaware) have introduced bills in October and March 2006, respectively, addressing the expansion of HIT and the establishment of an interoperable health information infrastructure. (#8, #9)

Juxtaposed within this policy environment, the CMS and OIG proposals reflect a major step in addressing the operational barriers currently encumbering HIT adoption.

Change based on an overall national health policy statement

The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 includes provisions to foster e-prescribing through the creation of standards that would increase systems? interoperability

Purpose and process analysis

Current Process Stages

	Idee	Pilotprojekt	Strategiepapier	Gesetzgebung	Umsetzung	Evaluation	Veränderung/Richtungswechsel
Implemented in this survey?

Origins of health policy idea

The proposals are interpretations of language set forth in the Medicare Modernization Act of 2003, which called for the removal of rules that could block third-party support of e-prescribing.  They represent amendments to federal physician self-referral law and the anti-kickback statute, which have long been sources of confusion and controversy in the health care industry.  The proposals offered by the CMS and OIG agencies reflect innovative efforts to remove operational barriers inhibiting the adoption of e-prescribing.

Initiators of idea/main actors

• Regierung: Government/CMS/OIG: very supportive

Approach of idea

The approach of the idea is described as:
amended: Proposed rules offer exemptions and safe harbor from federal physician self-referral and anti-kickback legislation.

Stakeholder positions

The proposed rules are relatively uncontroversial and supported by most stakeholders.  CMS and OIG released the proposals in the Federal Register on October 11, 2005 and accepted public comments until December 12, 2005.  Most advocacy groups commended the agencies for spearheading regulatory reform to advance the nation's HIT infrastructure.  Several suggested broader exemptions, particularly in the area of EHRs.  Others felt that the proposed regulations struggled between promoting adoption versus interoperability rather than promoting both simultaneously. (#10, #11)  CMS and OIG are taking these comments under advisement before releasing the finalized regulations.

Actors and positions

Regierung
Medicare Beneficiaries	sehr unterstützend		stark dagegen
Physicians/providers	sehr unterstützend		stark dagegen
Hospitals/other health care organizations	sehr unterstützend		stark dagegen

Influences in policy making and legislation

The finalized regulations, modified based upon public comments, will become part of official CMS and OIG regulation and will serve as exemptions to federal self-referral and anti-kickback legislation. 

Legislative outcome

pending

Actors and influence

Regierung
Medicare Beneficiaries	sehr groß		kein
Physicians/providers	sehr groß		kein
Hospitals/other health care organizations	sehr groß		kein

Positions and Influences at a glance

Adoption and implementation

OIG and CMS have the authority to amend the proposed regulations and must accept public comments before finalizing regulatory language. 

Monitoring and evaluation

Evaluation will not take place until regulations are finalized.

Review mechanisms

keine Angaben

Results of evaluation

Not yet done.

Expected outcome

Outcomes of the amended legislation can be assessed once the rules have been finalized by OIG and CMS.  Effect can be measured by the new implementation of e-prescribing technology among Medicare providers based upon eased regulatory constraints.

Impact of this policy

Qualität	kaum Einfluss		starker Einfluss
Gerechtigkeit	System weniger gerecht		System gerechter
Kosteneffizienz	sehr gering		sehr hoch

References

Sources of Information

1.  Office of the National Coordinator for Health Information Technology.  Online press release (HHS Announces New Regulations that support e-prescribing and EHR adoption).  Internet address: www.hhs.gov/healthit/e-prescribing.html (accessed February 23, 2006).

2.  Hartsfield, Shannon.  MMA and ePrescribing - New Compliance Standars for eHealth.  Food and Drug Law.  2005 March; 2(1): 3-4.  Internet address:  www.hklaw.com/Publications/Newsletters.asp?ID=557&Article=2996 (accessed March 20, 2006).

3.  D.W. Bates et al., "The Impact of Computerized Order Entry Systems on Medication Error Prevention."  Journal of the American Medical Informatics Association 6, no. 4(1999): 313-321.

4.  HR Policy Association.  Congress Moving on Bills to Improve Health Care System Through Expanded Information Technology.  Policy Brief.  Internet address: www.hrpolicy.org/memoranda/2005/05-181_IT_Bill_PB.pdf  (accessed March 17, 2006).

5.  Watnik R.  Antikickback versus Stark: What's the Difference?  Healthcare Financial Management.  March 2000.  Internet address: www.findarticles.com/p/articles/mi_m3257/is_3_54/ai_60139659  (accessed March 14, 2006).

6.  Federal Register. October 11, 2005; 70(195).

7.  Bell D and Friedman M.  E-Prescribing and the Medicare Modernization Act of 2003.  Health Affairs. 2005 September/October; 24(5):1168.

8.  eHealth Initiative.  S.1418 (Wired for Health Care Quality Act of 2005).  Internet address: www.ehealthinitiative.org/initiatives/policy/  (accessed March 21, 2006).

9.  iHealth Beat.  Rep. Nancy Johnson to Introduce Health IT Bill.  July 28, 2005.  Internet address: www.ihealthbeat.org/index.cfm?Action=dspItem&itemID=112943 (accessed March 15, 2006).

10.  Federation of American Hospitals.  Comments on OIG-405-P; Safe Harbor for Certain Electronic Prescribing Arrangements under the Anti-Kickback Statute.  December 12, 2005.

11.  Association of American Medical Colleges.  Comments on proposed rules related to electronic prescribing and electronic health records.  November 3, 2005.

Author/s and/or contributors to this survey

Elizabeth L. Speaker, The Commonwealth Fund (reviewed by Anne-Marie J Audet, MD, MSc)

Empfohlene Zitierweise für diesen Online-Artikel:

Elizabeth L. Speaker, The Commonwealth Fund (reviewed by Anne-Marie J Audet, MD, MSc). "Adoption of E-prescribing Technology". Health Policy Monitor, 12/04/2006. Available at http://www.hpm.org/survey/us/c7/4