By John Lyon hospitals charge a tax when Arkansas News Bureau providing records directly to LITTLE ROCK — A state finance patients? Theis said doctors official says he disagrees and hospitals are not in the with Attorney General Dustin business of selling medical McDaniel on whether companies records. that maintain medical records “The isolated sales exemption are required to collect a says that those kinds of sales tax when releasing isolated transactions are not those records to Arkansas taxable, but when you have a patients. business that accumulates John Theis, assistant revenue medical records and then commissioner with the turns and provides those Arkansas Department of medical records to a customer Finance and Administration, for a fee, then you’re said today the companies are selling a product,” he said. required to collect a tax on McDaniel declined to respond the records, despite a recent today to Theis’ comments, but opinion to the contrary late this afternoon he issued issued by McDaniel. a revised opinion summary The issue is the subject of a noting that “notwithstanding class-action lawsuit filed my opinion, the Department of last week in Pope County Finance and Administration, Circuit Court. The lawsuit which, absent a contrary alleges HealthPort court ruling, has Technologies, a Georgia-based jurisdiction over this matter, company that maintains has reportedly concluded that medical records for hospitals the provision of these and doctors, has been records is subject to charging Arkansans an illegal taxation as the sale of sales tax when they request personal property.” copies of their records. Attorney Jimmy Streett, who HealthPort says it has been filed the lawsuit, said today instructed by the state of he agrees with McDaniel. He Arkansas to collect the tax. said DF&A erroneously views The Streett Law Firm in the providing of medical Russellville filed the records to patients as a lawsuit after obtaining an money-making venture for opinion on the matter from companies like HealthPort. the attorney general’s office. “Their profit-making The opinion states that mechanism is not from quote- Section 16-46-106(a)(1) of unquote ’selling’ patients’ the Arkansas Code “itemizes medical information back to in detail the specific costs them,” Streett said. “They a health-care provider may make their money by working charge a patient for out arrangements with supplying the records. At no hospitals and medical point does the statute providers to manage their suggest that a health-care medical records.” provider may charge a sales Streett said Arkansas law tax for supplying such clearly limits companies like records.” HealthPort to charging Theis said today, “We patients only enough to disagree with their legal recoup their costs. conclusion.” “It’s not a sale, and as a At least nine times since matter of law it’s not 1995, DF&A has sent letters allowed to be a sale,” he to medical records suppliers said. advising them that they are The lawsuit seeks required to collect a sales reimbursement for plaintiff tax when providing copies of Theresa Holbrook of medical records to Arkansas Russellville and all other patients, Theis said. Arkansans who have been “The sales tax applies to the charged a sales tax on sale of tangible personal medical records they obtained property, and what we’ve said from HealthPort. Streett said is that a company such as the the outcome of the case will one involved here that is a have “an enormous impact” medical records supplier, because Arkansans make when that company sells the thousands of requests for medical items, they’re medical records every year. selling items of tangible As for the difference of personal property, just like opinion between DF&A and the anyone selling any other item, attorney general’s office, and the sales tax law would Streett said, “The only apply to that,” he said. opinion that matters is the So why don’t doctors and judge’s.”
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