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On March 4, 2013, the Tennessee Attorney General issued an opinion severely restricting many if not most donations of electronic health records (EHR) in Tennessee. Specifically, the Tennessee Attorney General relied on Tenn. Code Ann. 68-29-129(7), which is part of the Tennessee Medical Laboratory Act, and prohibits any person from soliciting the referral of specimens to such person’s (or to any other) medical laboratory or from contracting to perform medical laboratory examination of specimens “in a manner that offers or implies an offer of rebates to a person or persons submitting specimens, other fee-splitting inducements, participation in any fee-splitting arrangements, or other unearned remuneration.” The Tennessee Attorney General opined that this “anti-kickback” provision prohibits any explicit or implicit financial incentive to solicit a contract to perform medical laboratory examinations of specimens. Thus, even the implication of an offer by a medical laboratory of a rebate, fee-splitting inducement, fee-splitting arrangement, or “other unearned remuneration” to a person submitting specimens is prohibited.

Accordingly, the Tennessee Attorney General ruled that a licensed medical laboratory is prohibited from making any monetary donation to a physician to cover the cost of software designed to manage the physician’s EHR when the physician’s office that receives the donation either continues an existing referral arrangement with the donating laboratory or subsequently initiates an arrangement for referral of specimens to the donating laboratory for analysis.

As the federal safe harbor for EHR donations, which is scheduled to terminate on December 31, 2013, does not preempt or displace state anti-kickback law and regulations, all providers must comply with both federal and state statutes and regulations.

For more information, please contact:

Jenny McGovern


Jane Pine Wood


Healthcare Practice

McDonald Hopkins has a large and diverse healthcare practice, which is national in scope. The firm represents a wide variety of healthcare providers, facilities, vendors, technology companies and associations. Our diverse experience enables us to give our clients a unique perspective on the issues that may confront them in the rapidly evolving healthcare environment.