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CMS to Examine Regulatory Burden of Stark Law

Publications - Client Alert | June 21, 2018

The Centers for Medicare & Medicaid Services (“CMS”) is seeking public feedback regarding the regulatory burden of the Physician Self-Referral Law (commonly known as the “Stark Law”) and whether CMS should ease some of the regulatory restrictions associated therewith. On Wednesday, June 20, the CMS filed for public inspection a Request for Information Regarding the Physician Self-Referral Law (the “RFI”), to be published in the Federal Register on June 25. Per the RFI, the CMS has identified the Stark Law as a potential barrier to coordinated care and is seeking public comment on the impact and burden of the Stark Law and whether the Stark Law prevents or inhibits care coordination. The CMS is interested in stakeholders’ comments on the following broad issues:

  • The structure of arrangements between parties that participate in alternative payment models or other novel financial arrangements
  • The need for revisions or additions to exceptions to the Stark Law
  • Terminology related to alternative payment models and the Stark Law

To evaluate these three specifically identified issues, the CMS provides 20 open-ended questions for stakeholders to provide comment. The list of questions begins on page 6 of the unpublished RFI, which can be found here. Of note, the questions include, but are not limited to the following:

  1. What, if any, additional exceptions to the Stark Law are necessary to protect financial arrangements that involve integrating and coordinating care outside of an alternative payment model
  2. Whether the current exception at 42 CFR 411.357(n) for risk-sharing arrangements is effective
  3. Whether the special rule for compensation under a physician incentive plan within the exception at 42 CFR 411.357(d) for personal services arrangements is useful
  4. How should the CMS define commercial reasonableness in the context of the Stark Law
  5. Whether the CMS should modify the definition of “fair market value”
  6. When compensation should be considered to “take into account the volume or value of referrals” by a physician or “take into account business generated” between parties to an arrangement
  7. Whether barriers exist to qualifying as a “group practice”
  8. Whether transparency about physician’s financial relationships, price transparency or the availability of other data necessary for informed consumer purchasing could reduce or eliminate the harms to the Medicare program and its beneficiaries that the Stark Law is intended to address
  9. What are the compliance costs for regulated entities

To be assured consideration, comments must be received within 60 days of publication (anticipated date of August 24, 2018).

Additional Information 

If you have questions regarding CMS’ request for public feedback, please contact a member of our National Healthcare Practice Group.