Faegre Drinker assisted a community hospital with a request for an Advisory Opinion from the U.S. Department of Health and Human Services Office of Inspector General (OIG) regarding the hospital's proposed sale of certain electronic health record (EHR) technology at less than fair market value to critical access hospitals (CAHs) in the hospital's extended service area. The proposed transaction did not meet the requirements of any safe harbor to the Anti-Kickback Statute, yet the hospital believes it dodn't pose undue risk of a finding of violation of the Anti-Kickback Statute. We developed the proposed transaction to satisfy the hospital's business needs and the financial condition of the CAHs, and also crafted the arguments supporting the proposed transaction’s low risk of a finding of violation of the Anti-Kickback Statute in the Advisory Opinion request. Our team worked on responding to all information requests.
The project was particularly complex due to its strategic importance to the hospital and the CAHs. The delay in cost-based reimbursement to the CAHs, and their lack of funding sources other than the hospital, makes compliance with the electronic health record safe harbor difficult, yet bringing these disparate facilities together for care coordination purposes through a shared EHR is aimed to result in a real improvement in the care provided.
