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YO R K C O M E D S O C . O R G

To reach this conclusion, the Court examined the plain text
of the HITECH Act. The Court opined that the HITECH Act
says nothing about a right to transmit, to third parties, PHI
contained in any format other than an EHR. Congressional intent
in limiting the scope of the HITECH Act's third-party directive,
the Court reasoned, is clear. Thus, the Omnibus Rule's expansion
of the third-party directive conflicts with the plain language of the
HITECH Act and goes beyond the statutory requirements set by
Congress.

Third Party Fee Limitations
To ensure that patient access to PHI is not thwarted by
excessive fees, HHS has adopted rules that limit what individuals
may be charged for receiving copies of their PHI.
Under HHS regulations, see 45 CFR §164.524(c)(4), covered
entities may charge only a reasonable cost-based fee of individuals
requesting copies of their PHI. This fee can include only the cost
of labor for copying the record, supplies for creating the copy,
postage, and the cost of preparing an explanation or providing a
summary of the requested PHI. Regarding copies of electronic
PHI (ePHI), pursuant to the HITECH Act, covered entities
can charge no more than a fee for the labor costs associated with
fulfilling an individual's request for a copy of their ePHI. These fee
limitations are commonly referred to as the 'Patient Rate.'
In 2016, HHS published an informal guidance document
("2016 Guidance") which stated that the Patient Rate would apply
to patient requests both where the individual requests delivery
of the PHI to themselves and where the individual requests
transmittal to a third party. In this same guidance, HHS noted
that the Patient Rate would not apply to a request made by a third
party pursuant to a HIPAA authorization signed by the patient.
The 2016 Guidance also advised that in lieu of calculating
the actual or average cost of providing copies of electronic PHI,
providers may charge an optional flat rate not to
exceed $6.50. Again, this flat rate applied both
when delivery of the requested PHI is to the
patient and when delivery is to a third party as
requested by the patient.

2016 Guidance was issued by HHS without such a notice and
comment period.
The Court concluded that the 2016 Guidance is a legislative
rule as it created a change in law with respect to the Patient Rate.
To reach this conclusion, the Court examined the plain text of
the applicable regulations and statutes, the Court opined that
neither HHS regulations nor the HITECH Act make the Patient
Rate applicable to third-party directives. Finding no legislative
or regulatory source to expand the Patient Rate to third parties,
the Court vacated the 2016 Guidance. The Court thus declared
the 2016 Guidance unlawful insofar as it, without going through
a notice and comment period, extends the Patient Rate to reach
third-party directives.

What Does This Mean in the Short-Term for Fees?
Absent a reversal by a court of appeals, new legislative action,
or regulatory action by HHS, the court's ruling means that the
Patient Rate for medical records no longer applies in situations
where the patient directs the entity holding the medical records to
transmit them to a third party, such as an attorney. To maintain
the patient rate, the patient will have to request the records and
have them transmitted directly to the patient.
At this time, it is not known what further actions HHS might
take. The Pennsylvania Medical Society (PAMED) will continue
to monitor for additional developments. If new guidance is issued,
additional regulations are promulgated, or further court action is
pursued, PAMED will update members accordingly.
Keep in mind state guidance on copying fees. The Pennsylvania
Department of Health (DOH) annually publishes guidelines and
maximum fees that a health care provider or facility may charge
in response to requests for production of medical charts or
records. PAMED members can access a convenient
chart with 2020 copying fees here.

Prior to the 2016 Guidance, the medical
record industry understood that fee
limitations imposed by the Patient Rate
applied only to requests for PHI made
by the patient for use by the patient.
The 2016 Guidance changed this
understanding. In its lawsuit, Ciox
Health challenged the legality of these
changes to interpretation of the Patient
Rate by HHS.
Under federal law, agency actions
that change laws or impose new legal
obligations are known as legislative rules and
must undergo a notice and comment period. The
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York County Medicine Spring 2020

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