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Connecticut joins several other states in restricting the ability of a laboratory to make a donation towards the electronic health record (EHR) system of a referral source. The Connecticut Department of Public Health (CDPH) recently issued a decision that unless the difference between the actual cost of the EHR software interface and the donation is small and the donation is not made to influence the receiving physician’s behavior, a laboratory’s payment of or offering to pay more than the cost of an EHR software interface is a violation of Connecticut law.

In arriving at its decision, the CDPH drew a sharp distinction between the cost of an EHR system (ranging between $80,000 and $120,000) and a software interface (ranging between $8,000 and $12,000), when both allow a laboratory provider to electronically communicate with a physician regarding pathology or laboratory testing orders and results.

The CDPH then analyzed whether paying up to 85 percent of the cost of an EHR constitutes a “bribe” in violation of Conn. Gen Stat. § 19a-30(f) and Conn. Agencies Regs. § 19a-36-D36(a)(1). The CDPH initially found that such a payment satisfies the valuable consideration prong of the analysis. The CDPH then noted that the regulation itself expressly deems “offering or providing a requester of laboratory services office equipment” a bribe. Consequently, as an EHR system is “office equipment” the CDPH found that the influence prong of the analysis was satisfied. Thus, donating a portion of the cost of an EHR system is per se impermissible unless the donation satisfies Connecticut’s safe harbor provision that the equipment is “used solely to collect, transport, process or store specimens or order or communicate the results of tests or procedures for the laboratory.”

The CDPH concluded that donating or offering to donate an amount greater than the cost of the software interface takes the donation of the EHR system outside the safe harbor and violates the regulation regardless of the donor’s intent. Intent is only a relevant consideration in a case where the difference between the actual donation and the cost of a software interface is small.

Therefore, in Connecticut, licensed laboratories should not be donating more than the cost of the software interface unless the laboratory can show the actual cost of the software interface and the donation is small and the donation is not made to influence the receiving physician’s behavior.

For more information, please contact:

Jenny McGovern
312.642.6151
jmcgovern@mcdonaldhopkins.com

Jane Pine Wood
508.385.5227
jwood@mcdonaldhopkins.com

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.

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