On July 31, 2024, the Department of Health and Human Services (HHS) final rule, 89 FR 54662, establishing disincentives for certain healthcare providers that have committed information blocking, will become effective. This rule further implements the 21st Century Cures Act by allowing the Centers for Medicare & Medicaid Services (CMS) to impose disincentives on certain healthcare providers that the Office of Inspector General (OIG) has determined committed information blocking.

Information blocking, under 45 CFR 171.103, is a practice conducted by a healthcare provider that is likely to interfere with access to, exchange of, or use of electronic health information. OIG has informally advised that when investigating whether a provider has committed information blocking, it will consider: (i) actual or potential patient harm; (ii) significant impacts to ability to provide care; (iii) duration; and (iv) financial loss to federal healthcare programs or government or private entities.

OIG will inform CMS of its determination, and CMS will notify the provider of the disincentive being applied under the final rule, which could include the following:

• Under the Medicare Promoting Interoperability Program, an eligible hospital or critical access hospital (CAH) will not be a meaningful electronic health record (EHR) user for a year; thus, an eligible hospital will not be able to earn three-quarters of the annual market basket increase, and a CAH payment will be reduced to 100 percent of reasonable costs from 101 percent.

• Under the Promoting Interoperability performance category of the Merit-based Incentive Payment System (MIPS), a MIPS-eligible clinician or group practice will not be a meaningful EHR user for a year; thus, they will receive a zero in that category, which is typically a quarter of a final score in a performance period/MIPS payment year.

• Under the Medicare Shared Savings Program (MSSP), a healthcare provider that is an Accountable Care Organization (ACO), or an ACO participant, provider, or supplier, will be ineligible to participate in the MSSP for at least one year. CMS will consider certain facts before applying this disincentive and deciding whether to apply it for more than one year.

This rule was finalized on the heels of the OIG’s June 2023 final rule, 88 FR 42820, which allows the OIG to penalize certain health information technology individuals or entities committing information blocking.

Additionally, the Office of the National Coordinator for Health Information Technology can post information on its website about healthcare providers who committed information blocking, including their name, their business address, the practice and the disincentives applied.

Healthcare providers should expect more actions against information blocking in future rulemaking, as the final rule expressly acknowledges that the disincentives do not cover all the types of providers (e.g., laboratories and pharmacies) defined in 45 CFR 171.102.

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