Health IT Support
Not a "Stark" Kickback

Physician adoption of electronic health records is woefully inadequate, and current Stark and anti-kickback laws are part of the problem. Congress should pass reforms that create new exceptions to these statutes so that hospital systems and other entities can choose to provide community physicians with health information technology, particularly electronic health records.

These reforms will speed the widespread adoption of health IT, quickly close the "adoption gap" between large and small physician practices, and improve the lives and health care of millions of Americans.

Health IT, especially electronic health records, undoubtedly saves countless lives and vastly improves patient safety and increases access to care--from preventing dangerous drug interactions and other medical errors to identifying best practices and having real-time patient data at the point of care. Study after study demonstrates the stunning power of health IT to improve patient health.

In addition to improving quality, health IT saves the health care system substantial sums of money. A recent study in Health Affairs stated that an interconnected health IT network could save upward of $ 80 billion a year.

Those are savings that could be used for other priorities, like insuring every American and reducing health care costs for all.

Unfortunately, health IT has not been embraced and championed on a grand scale, despite its impressive outcomes. According to a recent study by the Centers for Disease Control and Prevention, only 17% of all physicians currently use electronic health records. The adoption rate is even lower in smaller physician practices.

The lack of widespread adoption results primarily from issues related to who can and will pay for the necessary infrastructure.

One potential private-sector solution is for large hospital systems and other entities, such as pharmaceutical manufacturers, to play a major role.

These systems generally have the resources and prestige to provide community physicians and clinics with the hardware, software, and expertise necessary to move physicians into the information age--and beyond the clipboard.

However, as the Government Accountability Office recently reported, "physicians may be reluctant to accept IT resources from a hospital or other provider, knowing that the resources may be viewed as [a financial incentive] and that any referrals the physician subsequently makes to the provider may be viewed as having been made in return for such resources in violation of [Stark and antikickback laws]."

These laws certainly go a long way toward protecting the system--and patients from fraud and abuse by criminal providers and suppliers.

However, by preventing hospitals that are willing to assist community physicians with purchasing health IT, the laws pose a significant barrier to widespread adoption--and to subsequent improvements in health.

To break down this barrier, legislative reforms must be enacted to the Stark and antikickback statutes to create exceptions that protect hospitals and physicians from prosecution for collaborating on health IT.

Several bipartisan bills pending in the Senate are promising: Majority Leader Bill Frist (R-Tenn.) and Sen. Hillary Rodham Clinton (D-N.Y.) teamed up on a broad health IT bill with Stark and anti kickback reforms. Sen. Chuck Grassley (R-Iowa), Sen. Max Baucus (D-Mont.), Sen. Mike Enzi (R-Wyo.), and Sen. Ted Kennedy (D-Mass.) have also introduced a bill.

To expedite health IT adoption, Congress must make these exceptions available immediately. However, the exceptions should also include a requirement that once data interoperability standards are announced, only technologies that comply with those standards will qualify for an exception.

This will allow doctors to use the technologies to refer their patients to any hospital they choose.

We support Stark and antikickback laws when they seek to protect patients and lower health care costs by eliminating fraud and abuse in the system, but by standing in the way of widespread health IT adoption, these laws are costing countless lives and billions of dollars. It's time to enact health IT exceptions to both of these statutes before even more American lives are lost.

Newt Gingrich is a senior fellow at AEI.

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