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21st Century Cures Act and IRS Section 179


Today’s rapidly changing healthcare landscape and the increase of patient data means there are multiple areas of compliance. You need to protect patient data while facilitating their care in every way possible.

The twin goals of data accessibility and protection fall under multiple laws and regulations. One of the most important requirements for healthcare providers and others who manage patient data is making sure there are no instances of information blocking, as outlined in the 21st Century Cures Act.

What is the 21st Century Cures Act?

In May 2020, the Office of the National Coordinator for Health Information Technology (ONC) released the 21st Century Cures Act: Interoperability, Information Blocking and the ONC Health IT Certification Program (also known as the Information Blocking Final Rule).

The Information Blocking Final Rule implements health IT provisions enacted in the 21st Century Cures Act. Its goal is to enable widespread interoperability among health IT systems and make it easier for patients and their providers to access their medical information.

According to the ACT, anyone who controls patient data is an Actor. The Information Blocking Final Rule applies to three categories of Actors:

  • Healthcare providers
  • Health Information Networks (HINs) or Health Information Exchanges (HIEs)
  • Developers of certified health IT

What is information blocking?

It is any practice that blocks or may block access to, exchange of, or use of Electronic Health Information (EHI). Before Oct. 22, 2021, EHI referred to:

  • Health data classes (such as patient demographics, vital signs and clinical notes)
  • Health data elements including a patient’s name, their heart rate and their lab reports)

In practice, EHI is the information within a typical electronic health record (EHR). On Oct. 22, 2021, the definition of EHI will also include all electronic PHI (excluding any psychotherapy notes) that are included in a patient’s designated record set and/or collected information that is pending litigation or administrative action.

Information blocking practices include:

  • Requiring written consent to obtain or transfer records
  • Charging unreasonable fees for records to be copied or transferred
  • Customizing EHRs in ways that make it difficult to share EHI with unaffiliated providers
  • Making it difficult or expensive to write new EHI into an EHR
  • Discouraging use of data integration to speed compliance

There are some exceptions to information blocking, for use as a defense, if you or your practice comes under scrutiny. However, they are complex and you must meet all sub-exceptions to qualify.

The penalties for info blocking are severe, with a proposed maximum $1 million fine for each violation. Making sure your practice is not info-blocking needs to be a top priority. Find out if you are at risk of being flagged for information blocking in our recent blog.

What can be done to prevent information blocking?

Using a health information exchange (HIE) can help you abide by nationally recognized standards for the electronic movement of health-related information. An HIE provides a way for everyone in the exchange to access and securely share a patient’s vital medical information electronically. This includes patients, doctors, nurses, pharmacists and other healthcare providers.

Another option is to form a clinically integrated network (CIN) to share clinical information and coordinate care. A CIN is a group of health providers who join with other physicians, post-acute care specialists, labs, hospitals and clinics to share patient information. By working together, they can reduce the cost of care for patients and providers alike.

Software and integration platforms can help your practice to organize, store and facilitate the exchange of data within your CIN. It can also help you meet reporting requirements to avoid penalties and attain higher reimbursement payments.

What does this have to do with taxes?

Adding new software or equipment late in the year can be an unexpected expense. While integration can help your practice and potentially eliminate fines, you may wonder how to justify your expenditure. You may not be aware, but Info-blocking software and platforms qualify for certain tax deductions.

Section 179 of the U.S. internal revenue code applies to software, equipment and hardware purchases. This business deduction includes almost any type of software, including subscription software, SaaS, ERPs, CRMs, HR, medical, legal and accounting software.

This makes implementing data integration platforms and info-blocking software much more affordable. The 2021 deduction limit for Section 179 is $1,050,000, applicable for purchases up to $2,620,000. The 100% bonus depreciation also applies, meaning you can write off the full amount in the first year of use.

Get compliant today

By taking advantage of Section 179, you can streamline your pathway to better compliance of the info-blocking rules outlined in the Cures Act. This will help you put protections in place to prevent data restrictions from blocking access in violation of the Act, while still maintaining the data security and privacy required and expected of you as a healthcare provider.

To qualify for the deductions and bonus depreciation, you must put your solution into service before the end of the year. The sooner the better, because expansion of the EHI definition begins Oct. 22, after which even more data is subject to the Cures Act requirements.

Being able to qualify for savings on your taxes can significantly defray the expense of integration, so there is no reason not to move forward with your plan for Cures Act compliance now. Prior to making any purchases, please be sure to consult with your tax professional to learn exactly how Section 179 may apply to your specific situation.

Where Tangible fits in

Tangible is the ideal solution for mitigating info-blocking risk as our Integration Platform as a Service (iPaSS) helps connect your data safely and securely with everyone who needs access, maintaining patient privacy while complying with info-blocking rules.

To learn more about how Tangible can help you achieve compliance with info-blocking regulations and ensure your patients and connected providers can easily and securely relay information, contact us today.


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