Updated Stark Law and Anti-Kickback Statute Regulations Aimed at Improving Coordinated Care

by  Jared Staheli
December 7th, 2020

The transformation of the American healthcare system from a primarily fee-for-service system to one based on value has been one of astonishing speed and scope, touching every aspect of health care. Changes of this scale inevitably have ripple effects that impact other laws and regulations,  outdating them or highlighting inadequacies and necessitating fixes. Recent reforms announced by HHS to the Physician Self-Referral Law (also known as Stark Law) and Anti-Kickback Statute as part of their Regulatory Sprint to Coordinated Care, designed to eliminate barriers to providing this type of care, are prime examples of these knock-on effects.

Stark Law and the Anti-Kickback Statute are well-intentioned rules aimed at preventing fraud and abuse. Stark Law prohibits providers from referring patients to certain “designated health services” payable by Medicare or Medicaid if the provider or an immediate family member has a financial relationship to the entity. Anti-kickback rules are self-explanatory — physicians are prohibited from receiving inducements or compensation for referrals.

While fighting fraud and abuse are, of course, good and necessary, these regulations have stood in the way of care coordination — a particularly necessary service for many value-based arrangements which rely on diverse care teams — as providers fear running afoul of rules that can lead to steep fines and exclusion from participation in federal healthcare programs. Because providers can violate these rules and be subjected to penalties even without knowledge of the law or intent to break it, many have taken the rational approach of avoiding entering into business relationships which could lead to trouble. 

In order to encourage the formation of beneficial partnerships, HHS released their Final Rule, Revisions to Safe Harbors Under the Anti-Kickback Statute, and Civil Monetary Penalty Rules Regarding Beneficiary Inducements, which revised existing and added new “safe harbors,” arrangements which would not be subject to fines or penalties under the existing rules. Since value and quality care are two vital goals for risk adjusted services, the revisions to these laws and detailed explanations and examples will considerably expand a provider's ability to meet them. These safe harbor changes include:

These new safe harbors vary by the type of remuneration protected, level of financial risk assumed by the parties, and safeguards included as safe harbor conditions.

Subject to definitions and conditions set forth in the regulations in the Final Rule, the final exception regulations under the Beneficiary Inducements CMP protect:

The HHS news release also lists some examples of arrangements made possible by this regulatory reform: 

For more information, review the Fact Sheet here.

Updated Stark Law and Anti-Kickback Statute Regulations Aimed at Improving Coordinated Care. (2020, December 7). Find-A-Code Articles. Retrieved from https://www.findacode.com/articles/updated-stark-law-and-anti-kickback-statute-regulations-aimed-at-improving-coordinated-care-36742.html

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