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Proposed Stark and AKS value-based overhauls present new challenges

Venson Wallin ( is Managing Director, National Healthcare Compliance and Regulatory Leader, The BDO Center for Healthcare Excellence & Innovation in Richmond, VA.

On October 9, 2019, the Centers for Medicare & Medicaid Services (CMS) and the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS), respectively, issued proposed revisions to the Stark Law[1] (aka, the physician self-referral law)[2] and the Anti-Kickback Statute[3] (AKS).[4] The revisions are intended to promote increased quality and care coordination by enabling more value-based arrangements.

Under the current state, arrangements between various providers are restricted in the interest of mitigating self-referral among these providers. However, this can inhibit innovation and discourage outcomes-based arrangements that could better serve patients. Providers have been reticent to enter into arrangements that could be perceived as being self-referring among each other, because they could receive significant fines and penalties as a result.

The proposed revisions to Stark and AKS, however, are intended to provide more leniency in the development of innovative provider arrangements in the form of new safe harbors. The promotion of patient engagement, technology sharing, and care coordination are all examples of new innovations that the OIG and CMS are hoping to encourage with the creation of these safe harbors. Their goal is to remove some of the barriers that providers feel prevent them from realizing a truly value-based level of care—higher quality and lower cost.

To date, with the existing Stark and AKS rules limiting the relationships that providers can enter into, variations of provider arrangements have been limited as well. This has resulted in the documentation of these arrangements being consistent across the industry, with few exceptions. These changes in Stark and AKS will result in a multitude of different value-based arrangements, and with them will come several new policies, procedures, and associated documentation. As a result, organizations will need to address new compliance challenges to ensure the benefits associated with these new arrangements outweigh any potential risk for fines and penalties resulting from a failure to follow the requirements of the changes in the law.

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