REVIEW DRAFT
SUBJECT TO MODIFICATION
IOM Health System, L.P.,d/b/a Lutheran Hospital of Indiana (“LHI”),
EHR Donation Program
TERMS AND CONDITIONS (INITIAL PHASE)
WHEREAS, it is recognized that the use of an electronic health record (“EHR”) will improve quality of patient care and improve patient safety by, among other benefits, promoting the coordination of care among patients, enabling providers to more effectively managing the care of individual patients, and enabling clinical integration to derive clinical information from other providers of care across the continuum of care through participation in Health Information Exchanges. In recognition of this fact, Congress passed legislation encouraging the use of EHR and directed the U.S. Department of Health and Human Services through its Office of Inspector General (“OIG”) and the Centers for Medicare and Medicaid Services (“CMS”) to promulgate regulations governing the provision of a donation (a “Donation”) of a portion of the cost incurred by a physician or physician organization (“Physician”) that meets the Regulatory Requirements referred to below(“Qualified Recipient”) for the purchase or license of certain components of Electronic Health Records Technology (“Qualified EHR Technology”).
WHEREAS, in accordance with the direction of Congress, CMS established an exception to the referral prohibition related to compensation arrangements under the regulations related to the Federal Self-Referral Statute, set forth in 42 CFR Section 411.357 (w) and the OIG established an exception to the kickback prohibition under the regulations related to the Federal Anti-Kickback Statute, set forth in 42 CFR Section 1001.952 (y) (collectively, “Regulatory Requirements”).
WHEREAS, donation of Qualified EHR Technology is expressly not conditioned on LHI or any of its related entities receiving referrals from the Physician, nor will selection be made by LHI based on the value or volume of such referrals in the past, if any, or anticipated referrals from the Physician.
WHEREAS, LHI has selected the Cerner Corporation Ambulatory ASP EHR to be the sole Qualified EHR Technology eligible for a Donation, based on factors which include the availability of Affiliate pricing and the opportunity to support the interoperability of EHR systems within the LHI System.
WHEREAS,LHI has committed, through its budgetary process, the total amount of ______Dollars ($______)(“Donation Budget”) to fund the Initial Phase of a program for donating Qualified EHR Technology to Qualified Recipients in order to help enhance the quality of patient care and improve patient safety in the communities served by the LHI (“Donation Program”). LHI may, but is not obligated to, extend the Initial Phase of the Donation Program or to offer subsequent Phases of the Donation Program, which may be under different Terms and Conditions.
NOW, THEREFORE, LHI establishes the LHI Donation Program on the terms and conditions set forth in this document, including the Recitals.
A. Qualified Recipient.A Qualified Recipient for purposes of the Donation Program is a Physician that:
(1) Is a party, in good standing to a Data Exchange Network Access Agreement with CareLink, the Health Information Exchange established by LHI,and remains in good standing throughout the term of any Donation;and
(2) Is a member of the Medical Staff of one or more of the following LHI Hospitals: Lutheran Hospital of Indiana, St. Joseph Hospital, Dupont Hospital, The Orthopedic Hospital, Kosciusko Community Hospital, Bluffton Regional Medical Center or Dukes Memorial Hospital in good standing as of the effective date of any Definitive Agreement for the Donation.
(3) Maintains at least one office open for patient care 120 days per calendar year within the in the states and counties served by LHI, attached as Exhibit A (“Service Area”)
(4) Preference will be given to Physicians that are the most active in the provision of patient care in the Service Area,as determined by LHI based upon service volume information from publically available claims data and similar sourcesselected by LHI. Such information will be blinded as to the recipientsof any referrals by a Physician.
(5) Any Physician Organization (i.e. an integrated physician practice eligible to receive an EHR Donation under the Regulatory Requirements, as determined by LHI), must have at least one full-time medical provider eligible for a Donation under the Regulatory Requirements. Full-time shall mean at least 1400 documented hours of clinical service with Physician Organization during the twelve month period preceding the Application for a Donation.
(6) All determinations of the whether a Physician is a Qualified Recipient will be made by LHI in its sole judgment based on the factors listed above and is final.
B. Maximum Donation Amount.The maximum Donation that LHI will make to a single Qualified Recipient is an amount calculated in accordance with Exhibit B(subject to any final adjustments in Cerner pricing to be reflected in the Donation Agreement) that LHI determines to be subject to a Donation, subject to the payment of the specified cost share of the Qualified Recipient, which shall in no event be less that Fifteen Percent (15%) of the total Donation amount, as provided in the Regulatory Requirements.
Notwithstanding the foregoing, in no event will LHI make a Donation that exceeds the amount permitted by the Regulatory Requirements or that causes LHI to exceed the Donation Budget.
C. Expiration of Donation Program; Closure Date of Initial Phase; Modification by LHI. The EHR Donation Program will expire on December 31, 2021 without further notice and any obligation of LHI to make Donations will end at that time. Applications for this Initial Phase of the Donation Program must be received, with all required information, by LHI on or before June 30, 2016to be considered. The EHR Donation Program, including the Initial Phase is subject to modification, termination, or extension in the sole discretion of LHIat any time prior to entry into a Donation Agreement, as defined below.
D.Application Process.Physicians wishing to apply for a Donation under the Donation Program must submit an application in the form required by LHI and may be required to provide further informationrequired to determine whether Physicianis a Qualified Recipient in compliance with the Regulatory Requirements and that a Donation is otherwise appropriate in accordance with these Terms and Conditions, in the sole judgment of LHI. The decision of LHI is final and is not subject to review or appeal.
E. Cerner Certified EHR Technology. The Cerner EHR Technology identified as the Cerner Ambulatory ASP EHR is the sole Cerner Qualified EHR product for which a Donation is available. Physicianwill be required, as a condition of the Donation,to enter into an agreement in a form required by Cerner, provided that such form will be consistent with the requirements of the Donation Program, including the delineation of items of Qualified EHR Technology to which the Donation applies and the pricing reflected in the final Donation Agreement (“License Agreement”). LHIshall not be a party to, or liable in any way under, the License Agreement. Note that Agreements for a Qualified EHR with Cerner or with any other vendor entered into by a Physician prior to the date of a Donation Agreement with LHI are not eligible for a Donation under the Regulatory Requirements.
F. General Terms and Conditions.
1. Verification of Information. LHI reserves the right to require verification satisfactory to it, in its sole discretion, of the initial and ongoing qualification of Physicianunder the Terms and Conditions and of the initial and ongoing accuracy of the information provided in the attached Application and of any other information provided by the Physician organization or the Vendor about the Qualified EHR Technology for which the Donation is sought.
2. Compliance with Law. Donation of the Qualifying EHR Technology must be made in compliance with the Regulatory Requirements, as determined by LHI in its sole discretion.
3. Program Not An Offer; No Rights Based On Application; No Rights Without Definitive Agreement. Meeting the criteria set forth in these Donation Program Terms and Conditions and/orsubmitting an Application for aDonation does not confer any contractual or other legal or equitable rights to a Donation in the Physician. Any contractual or other rights to, or related in any way to, a Donation will only arise if and when LHI enters into a definitive written agreement with the Physiciancontaining all of the relevant terms of the Donation, in the form required by LHI (“Donation Agreement”).
4. Donation Subject To Availability of Funds and Continuity of Donation Program. Until and unless LHI and Physician enter into a Donation Agreement, any Donation is, in addition to the other terms and conditions described in this Program Terms and Conditions, subject to the availability of sufficient funds from those funds committed to the Donation Program, as described in the Recitals and is also subject to a modification or termination of the Donation Program, including the Initial Phase,in the sole discretion of LHI, as set forth in Section C of these Terms and Conditions.
5. Void Where Prohibited By State Law; Physician Solely Responsible For Its Own Legal Review. The Donation Program is void and will not be implemented in any state in which state law or regulation prohibits a Donation by entities such as LHI or in which LHI determines that state law does not provide protection for the Donation equivalent, in the sole judgment of LHI, to the Regulatory Requirements. Physician is solely responsible for making its own determination of the effect, if any, of the Donation on Physician under the Regulatory Requirements or any other applicable law, rule or regulation but such determination is not binding on LHI.
6. Tax. LHI will issue an IRS Form 1099 to Physicianfor the amount of the Donation. Physician is solely responsible for payment of any taxes due from Physician as a result of the Donation. LHI has furnished no tax advice to Physician as to the Donation.
3014609.3
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EXHIBIT A
Service Area
(State and County)
1 / Indiana / Adams2 / Allen
3 / Blackford
4 / Cass
5 / DeKalb
6 / Fulton
7 / Grant
8 / Howard
9 / Huntington
10 / Jay
11 / Kosciusko
12 / LaGrange
13 / Marshall
14 / Miami
15 / Noble
16 / Porter
17 / Steuben
18 / Wabash
19 / Wells
20 / Whitley
21 / Ohio / Defiance
22 / Mercer
23 / Paulding
24 / Van Wert
25 / Williams
26 / Michigan / Branch
27 / St. Joseph
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EXHIBIT B
(Donation Categories and Preliminary Amounts)
Ambulatory Electronic Health Record (“EHR”) Subscription
EHR / EHR (with ancillary Practice Management Modules) / EHR (variable Cerner fee*)Providers / Donation (/provider) / % of Cerner fee / Donation (/provider) / % of Cerner fee / Donation (/provider) / % of Cerner fee
1-3 / $318.75 / 85% / $483.75 / 81% / $318.75 / N/A
4-6 / $301.75 / 85% / $459.25 / 81% / $301.75 / N/A
7-10 / $284.75 / 85% / $434.75 / 81% / $284.75 / N/A
11+ / $267.75 / 85% / $410.25 / 81% / $267.75 / N/A
EHR System Set Up Costs
Providers / Donation (/provider) / % of Cerner fee / Donation (/provider) / % of Cerner fee / Donation (/provider) / % of Cerner feeInitial Provider / $4,675 / 85% / $5,525 / 85% / $4,675 / 85%
Additional / $850 / 85% / $1,700 / 85% / $850 / 85%
EHR User Training
Training / Donation (/location) / % of Cerner fee / Donation (/location) / % of Cerner fee / Donation (/location) / % of Cerner feePer Location / $1,700 / 85% / $1,700 / 85% / $1,700 / 85%
*Support for Physicians selecting this option is fixed at an amount equal to the EHR amount, provided that in no event will Physician contribute less than 15% of the amount due Cerner. LHI’s Donation is solely for the EHR subscription; the other services provided by Cerner under this arrangement are optional, separate services selected by Physician, not supported by the Donation.
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