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  • Washington Highlights

    HHS Proposes Rules to Update Regulations for Stark Law and Anti-Kickback Statute

    Phoebe Ramsey, Director, Physician Payment & Quality
    Gayle Lee, Director, Physician Payment & Quality

    The Department of Health and Human Services (HHS) Oct. 9 announced two new proposed rules to modernize and clarify the regulations that interpret the Physician Self-Referral Law (“Stark Law”) and the Federal Anti-Kickback Statute.

    The new proposals are part of HHS’s Regulatory Sprint to Coordinated Care and are based upon feedback the agency received from stakeholders to its Requests for Information issued in 2018 [see Washington Highlights, Aug. 27, 2018]. The AAMC’s comments advocated the agency make significant changes to the regulations to support health care delivery system reforms to align payment with quality and improve the coordination of care. 

    Modernizing and Clarifying the Physician Self-Referral Regulations

    The Centers for Medicare & Medicaid Services (CMS) proposes to create new exceptions to the Stark Law for value-based arrangements for care furnished to all patients, not only those covered under Medicare. The agency proposes to permit certain value-based compensation arrangements between or among physicians, providers, and suppliers, including creating a new exception for certain arrangements where a physician receives limited remuneration for items or services provided by the physician. CMS also proposes new exceptions to allow certain new arrangements between physicians and other healthcare providers for the donations of certain cybersecurity technology and amends the existing exception for electronic health records (EHR) items and services.

    Finally, CMS is seeking comment on whether the agency should require the provision of cost-of-care information at the point of a referral for an item or services as part of the agency’s broader priorities relating to price transparency. CMS believes such a requirement could empower patients to discuss healthcare costs with their doctors and serve as an additional safeguard against fraud and abuse at the point of care.

    Revisions to Safe Harbors Under the Anti-Kickback Statute and Civil Monetary Penalty Rules Regarding Beneficiary Inducements

    The HHS Office of the Inspector General’s (OIG) proposed rule focuses on revisions to regulatory safe harbors from the anti-kickback law and the civil monetary penalties (CMP) rules prohibiting beneficiary inducements that would advance the transition to value-based care and improve coordination of patient care among providers and across care settings.

    Key proposals include: new safe harbors for care coordination arrangements to improve quality, health outcomes, and efficiency; value-based arrangements with substantial downside financial risk; and value-based arrangements with full financial risk for certain remuneration exchanged between or among eligible participants in a value-based arrangement that fosters better coordinated and managed patient care. These safe harbors vary by the types of remuneration protected, the level of financial risk assumed by the parties, and types of safeguards included as conditions of the applicable safe harbor.

    Additional new safe harbors are proposed for patient engagement, cybersecurity technology services, and CMS-sponsored models intended to reduce the need for separate and distinct fraud and abuse waivers for new models. The OIG also seeks to modify existing safe harbors, including the personal services and management contracts safe harbor to add flexibility for outcomes-based payments and part-time arrangements and the local transportation safe harbor to modify and expand mileage limits for rural areas and for patients discharged from inpatient facilities.

    Comments to each rule will be due 75 days from the date of publication of the Notice of Proposed Rulemaking in the Federal Register.