On June 25, the Centers for Medicare & Medicaid Services (CMS) issued a request for information (RFI) for public input on how to address any undue regulatory impact and burden of the physician self-referral law, also known as the Stark Law.
When enacted in 1989, the physician self-referral law, also known as the “Stark Law,” addressed the concern that health care decision making can be unduly influenced by a profit motive. The Stark Law was enacted to help protect Medicare and its beneficiaries from unnecessary costs and other harms that may occur when physicians benefit from referring patients to health care entities with which they have a financial relationship, according to CMS. The law prohibits a physician from making referrals for certain health care services to an entity with which he or she (or an immediate family member) has a financial relationship. There are statutory and regulatory exceptions, but in short, a physician cannot refer a patient to any service or provider in which they have a financial interest.
In its RFI, CMS officials said that through internal discussion and input from external stakeholders, CMS identified some aspects of the physician self-referral law as a potential barrier to coordinated care.
Further, CMS stated it has made facilitating coordinated care a top priority and seeks to “identify ways in which its regulations may impose undue burdens on the healthcare industry and serve as obstacles to coordinated care and its efforts to deliver better value and care for patients.”
In a blog post published in June, CMS Administrator Seema Verma wrote that over the past year, CMS has engaged with the provider community in a discussion about regulatory burden issues. This included publishing a RFI soliciting comments about areas of high regulatory burden. “One of the top areas of burden identified in the over 2,600 comments received was compliance with the physician self-referral law (often called the “Stark Law”) and its accompanying regulations,” Verma wrote. “In response to these concerns, CMS undertook a review of the existing regulations to determine where the agency could consider potential areas for burden reduction. In coordination with HHS Deputy Secretary Eric Hargan, CMS is now soliciting specific input on a range of issues identified with the Stark Law to help the agency better understand provider concerns and target its regulatory efforts to address those concerns.”
Verma noted that the Stark Law and regulations, in its current form, may hinder value-based care arrangements.
The U.S. Department of Health and Human Services (HHS) also is considering making changes to the anti-kickback statute as the HHS Office of the Inspector General (OIG) is looking for stakeholder feedback, via an RFI issued August 27, on how to address any regulatory provisions that may act as barriers to coordinated care or value-based care. The OIG RFI contained a broad range of questions and topics the agency wants stakeholders to comment on, including potential arrangements that the industry is interested in pursuing, such as care coordination, value-based arrangements, alternative payment models, arrangements involving innovative technology, and other novel financial arrangements that may implicate the anti-kickback statute or beneficiary inducements civil monetary penalty (CMP). HHS OIG also wants to know what types of incentives providers and suppliers are interested in providing to beneficiaries and how those incentives would improve care quality, care coordination, and patient engagement. The RFI’s comment period ends October 26.
The deadline to submit comments on the CMS RFI was August 24. AMGA, the Alexandria, Va.-based organization that represents medical groups, urged CMS to reform Stark Law regulations to encourage the adoption of value-based payment models.
AMGA provided comments on the timing and availability of Stark law waivers, how the law should be applied to Alternative Payment Models (APMs), and how transparency can better inform Medicare beneficiaries’ decision-making.
“The intent behind the Stark law, as Congressman Pete Stark himself admitted, was to create bright line rules so physicians can police their own behavior and not get distracted from focusing on improving care delivery,” Jerry Penso, M.D., AMGA president and chief executive officer, wrote in the letter to CMS. “New innovative models of care present a challenge for regulators who want to improve care coordination and outcomes via incentivized value-based arrangements without creating legal uncertainty in advancing these goals. CMS is in a difficult position, but there are regulatory improvements, however incremental, that can be made to Stark.”
AMGA recommended CMS provide the time and flexibility needed to amend changes in practice patterns that were implemented as part of participation in an ACO. Rather than end waiver authority immediately upon an exit from the model, CMS should provide healthcare providers with additional time to come into compliance and should keep waivers in place if they participate in other, non-Medicare APM models that include Medicaid and/or commercial plans, AMGA wrote in its comments.
Another group of healthcare industry stakeholders also urged CMS to relax anti-kickback rules so that resource-strapped healthcare providers can accept certain donations or subsidies of cybersecurity products and services.
The Healthcare and Public Health Sector Coordinating Council's Cybersecurity Working Group (HSCC CWG), which is composed of 198 healthcare organizations, companies and associations from across the healthcare industry, wrote a letter to CMS recommending that the agency create a Stark exception that “allows for the donation or subsidizing of cybersecurity technology and services to help improve the cybersecurity posture of providers, better protect patient information, improve patient safety, and help fortify the healthcare sector from growing global threats.”
HSCC CWG member organizations span the health care sector and “have a vested interest in advancing the cyber posture of the healthcare industry and improving patient safety.”
According to the HSCC CWG letter, Stark Law regulations were enacted prior to the development of information technologies and the healthcare system has since evolved into a network that is heavily dependent upon data being stored and moved electronically. Further, the healthcare industry is the target of double the number of cyber attacks as other industries, the organization said.
Most providers are ill-equipped to combat cyberattacks, especially sophisticated attacks by nation states and criminals,” the organization wrote. One of the recommendations of the Health Care Industry Cybersecurity Industry (HCIC) Task Force Report, mandated by the Cybersecurity Information Sharing Act of 2015 (CISA), called for a regulatory exception to the Stark Law and a safe harbor to the Anti-Kickback Statute to protect certain donations of electronic health record (EHR) to effectively address management of technology between health care entities and support cybersecurity.
“Creating a Stark exception that allows providers to donate cybersecurity technology (both hardware and software), training and tools to other providers (i.e. under-resourced or less sophisticated ones), will improve the overall cybersecurity posture of our industry and will help guard against cyber attacks that threaten patient safety. As the healthcare system is an interconnected and interdependent network, cyber threats are a shared challenge and a shared responsibility, which requires a team effort,” the organization wrote.
