Health IT EHR Opportunity September 22, 2009

Transcription

1 Health IT EHR Opportunity September 22, 2009 John M. Kirsner, Esq. Squire, Sanders & Dempsey L.L.P. Partner, Health Care and Life Sciences (614) Paul M. Lee Strategic Health Care Senior Partner (202) Scott A. Edelstein Squire, Sanders & Dempsey L.L.P. Partner, Health Care and Life Sciences (202)

2 Overview Purpose of Today s Presentation Proposal for Hospital/Physician collaboration: Creation of Health IT MSO/Association HITECH Act Legal Issues Next Steps Questions 2

3 Purpose of Today s Presentation Determine hospitals interest in developing a not-for-profit organization to help them implement an EHR physician alignment strategy. 3

4 New HIT MSO/Association Not-for-Profit Financed by Government NOT a one size fits all! Board members comprised of hospital CIOs Hospital CIO committees created to: Advise MSO staff/attorneys on direction Advise on the creation of legal documents Negotiate with vendors (hardware, software, etc ) Advocate for regulatory changes to meaningful use. 4

5 New HIT MSO/Association MSO would: Create all documents establishing MSO as legal entity Manage all Committees like association Be a resource (legal, marketing, etc ) to each hospital member Recommend solutions to group and individual implementation issues Advise Board and members on all issues regarding the successful management of the MSO Under the direction of the Board, adjust MSO mission based on member needs 5

6 Benefits Leverages buying power of multiple physicians at a national level for better pricing from vendors hardware & software Better pricing may result in pool of additional funds to meet future EHR needs Helps physicians maximize eligibility for incentive payments Brings together hospitals and physicians through an integrated, seamless EHR system 6

7 Benefits Free to physicians funded through HIT payments Turnkey solution for physicians One-stop shop for technology acquisition, implementation, maintenance and related support Manages complex regulations regarding meaningful use and other legal requirements, and monitors compliance Potential for Hospital/Hospital alignment through outsourcing of CIO/IT expertise of larger hosptals/systems to smaller hospitals/systems. 7

8 Benefits Ensures consistency in implementation Can be a step in a clinical integration program or accountable care organization program or medical home program Seasoned legal advice for physicians and hospitals Ability to obtain federal and state grant funding in which all participants can benefit Provides peer-to-peer opportunities for CIOs Organization owned by hospitals 8

9 Advantages COMPETITIVE ADVANGE FOR MEMBERS Only one hospital/system in each community NOT a Health IT Regional Extension Center Will use the services of the RECs to provide further advantages to member hospitals Not entangled with same government limitations NOT vendor-centric Hospitals/physicians can select own vendor 9

10 National HIT MSO/Association Example IT Vendor $300 Million EHR Software, Hardware, etc. Medicare Customer Hospitals (20) Hospital Group retains $140 Million to fund enhancements to EHR, support National HIT Assn., local MSO, etc. $440 Million EHR Services Physicians (10,000) 10

11 Advisory Committee Mike Bundy, CIO, Wellmont Health System (TN) Tom Gregorio, CIO, Newark Beth Israel MC (NJ) Arlo Jennings, CIO, Mission Hospitals (NC) Tom Johnson, CIO, DuBois Regional MC (PA) George Morris, CIO, Northwest Community (IL) Dana Moore, CIO, Centura Health, (CO) Dave Selman, CIO, ProMedica, (OH) Martin Tursky, CIO, Aultman Hospital (OH) Will Weider, CIO, Ministry Health Care (WI) Bernie Clement, CIO, East Jefferson General (LA) 11

12 Operational Flow Chart Hospital Physicians Equity Return Medicare Physician MSO/ Association Nat l HIT Assn. Vendor Medicaid 12

13 Creating the National HIT Association Budget under development Needs CIO input Dues and vendor support Government payments through physicians reimburse all members Not-for-Profit entity would contract with Strategic Health Care for staff support services. ED, hired by Board, would run organization day to day. NFP entity would contract with Squire Sanders for legal, regulatory, compliance services. 13

14 Facilitator MSO Structure Option 1 Hospital/Physician JV Hospital Physicians Equity Return Local MSO/ Facilitator Management and Purchasing Contract National MSO/ Association Medical Staff Members HIT Management Contracts 14

15 Facilitator MSO Structure Option 2 Hospital Subsidiary Hospital Equity Return Local MSO/ Facilitator Management and Purchasing Contract National MSO/ Association Medical Staff Members HIT Management Contracts 15

16 Facilitator MSO Structure Option 3 National MSO/Assn./Physician JV National MSO/ Association Physicians Management and Purchasing Contract Equity Return Local Facilitator/ MSO HIT Management Contracts Physicians 16

17 HITECH Act 17

18 HITECH Act American Recovery and Reinvestment Act of 2009 (Stimulus Law) provides $36 billion in funding for health information technology (HIT) and health information exchange (HIE) development Incentive payments to encourage hospitals and eligible professionals to adopt and use certified EHR systems Successful implementation of the HITECH Act would transform the healthcare system 18

19 Incentives for Physician Participation Additional health program payments to eligible professionals demonstrating meaningful use of EHR Penalties: Phased-in reduction of Medicare payments for eligible professionals not implementing meaningful use of EHR Medicare payment reductions will begin in 2015 for an eligible professional who is not a meaningful EHR user Reductions to the otherwise-payable fee schedule for covered professional services shall equal: 2015: 1%; 2016: 2%; 2017 and thereafter: 3% 2018 and beyond Secretary can further reduce payments by up to 5% if less than 75% of eligible professionals are meaningful EHR users 19

20 Medicare Incentive Payment Schedule Year First Year Payment 2011 First Year Payment 2012 First Year Payment 2013 First Year Payment $18, ,000 $18, ,000 12,000 $15, ,000 8,000 12,000 $15, ,000 4,000 8,000 12, ,000 4,000 8, Total $44,000 $44,000 $39,000 $35,000 Total with HPSA 10% $48,400 $48,400 $42,900 $38,500 20

21 Meaningful EHR User - Definition To demonstrate meaningful use of EHR, an eligible professional must satisfy three requirements: 1. Demonstrate use of certified EHR technology in a meaningful manner, including use for electronic prescribing 2. Demonstrate that certified EHR technology provides for electronic exchange of health information 3. Report on clinical quality measures using the EHR technology Refer to advisory committee recommendations. Final HHS regs by Spring

22 Legal Issues 22

23 Legal Issues to Consider Anti-Kickback Statute, 42 U.S.C. 1320a-7b(b) and 42 C.F.R et seq. Group Purchasing Safe Harbor protects the National HIT Association Personal Services Safe Harbor and adherence to fair market value principles protects the MSO Facilitator structure Stark Law, 42 U.S.C. 1395nn and 42 C.F.R et seq. No physician participation and no physician referrals at national level means no Stark issue for the National HIT Association MSO Facilitator implicates Stark law but several exceptions exist to immunize structure 23

24 Legal Issues to Consider Tax-Exempt Implications Only applies to non profit tax exempt hospitals, not to for profit hospitals Established legal principles provide comfort in joint venture setting for MSO Facilitator Control considerations Revenue sharing considerations Antitrust Implications Antitrust safety zone protects group purchasing aspects of National HIT Association and related purchasing structure

25 Legal Issues to Consider The Health Insurance Portability and Accountability Act of 1996, 42 U.S.C. 1320d et seq. and 45 C.F.R. 160 & 164 (HIPAA) Securities Law Implications State Regulatory Considerations State Stark Law State Anti-Kickback Statute State health and medical records laws

26 Next Steps Call participants will be ed a questionnaire and advisory. We want feedback! Interested Board members: please Paul Lee at Strategic Health Care Paul.Lee@shcare.net First Board conference call is scheduled for next week No financial obligation at this time 26

27 Questions?

28 Health IT EHR Opportunity September 22, 2009 John M. Kirsner, Esq. Squire, Sanders & Dempsey L.L.P. Partner, Health Care and Life Sciences (614) Paul M. Lee Strategic Health Care Senior Partner (202) Scott A. Edelstein Squire, Sanders & Dempsey L.L.P. Partner, Health Care and Life Sciences (202)