HHS's Efforts to Promote Health Information Technology and Legal Barriers to Its Adoption

GAO-04-991R: Published: Aug 13, 2004. Publicly Released: Aug 13, 2004.

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Janet Heinrich
(202) 512-7250


Office of Public Affairs
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Studies published by the Institute of Medicine and others have indicated that fragmented, disorganized, and inaccessible clinical information adversely affects the quality of health care and compromises patient safety. Health information technology (IT)--technology used to collect, store, retrieve, and transfer clinical, administrative, and financial health information electronically--is seen as a promising solution to this problem. Technologies such as electronic health records (EHR) and bar coding of certain human drug and biological product labels have been shown to save money and reduce medical errors. However, only a small number of U.S. health care providers have fully adopted health IT. Significant financial, technical, cultural, and legal barriers to the adoption of health IT exist. The Department of Health and Human Services (HHS), as a regulator, purchaser, health care provider, and sponsor of research, education, and training, has been working to promote the use of IT in public and private health care settings. There is no comprehensive catalogue of HHS' health IT efforts, however, and little is known about the nature and extent of the legal barriers and HHS's efforts to address them. The Chairman, Senate Committee on Health, Education, Labor, and Pensions, asked us to review HHS' activities to promote health IT. We examined the following questions: (1) What are the major HHS initiatives for promoting the adoption of health IT by public and private health care providers? (2) What are the legal barriers to the adoption of health IT by health care providers, and what is HHS doing to surmount them?

HHS reported that it has 19 major health IT initiatives that cover a broad range of activities and participants. In fiscal year 2004, HHS provided about $228 million for these initiatives. Some of them are designed to provide overall leadership and coordination for health IT across HHS, other federal agencies, and other public- and private-sector organizations. The majority of initiatives and most of the funding, however, are for health IT programmatic activities and grant programs administered by HHS operating divisions such as the Agency for Healthcare Research and Quality (AHRQ) and the Centers for Medicare and Medicaid Services (CMS). These initiatives range from support for the development of standard clinical terminologies to funding of demonstrations of health information systems. On July 21, 2004, the National Health Information Technology Coordinator delivered a framework for strategic action to the Secretary of HHS for promoting the adoption of health IT. Various laws present barriers to adoption of health IT, and at the time of our review HHS' efforts to address these barriers had been limited in scope. Experts we interviewed indicated that beyond legal issues related to the privacy and security of health information, there are various laws--some specifically health-related and some not--that present barriers to the adoption of health IT. These laws involve fraud and abuse, antitrust, federal income tax, intellectual property, malpractice, and state licensing. In the area of fraud and abuse, for example, both the Physician Self-Referral (Stark) Law and the Anti-kickback Law present barriers by impeding the establishment of arrangements between providers--such as the provision of IT resources--that would otherwise promote the adoption of health IT. Because the laws frequently do not address health IT arrangements directly, health care providers are uncertain about what would constitute violations of the laws or create a risk of litigation. To the extent there are uncertainties and ambiguity in predicting legal consequences, health care providers are reluctant to take action and make significant investments in health IT. HHS has attempted to address some of the legal barriers posed by the fraud and abuse laws, but experts told us these efforts have not been sufficient to overcome the reluctance of the providers. Further, little attempt has been made by other federal agencies to address other laws that may present barriers.

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