WHA Comments on CMS’ Proposed Stark Law Changes

January 09, 2020

WHA submitted comments to the Centers for Medicare & Medicaid Services (CMS) Dec. 30 supporting proposed changes to the physician self-referral, or Stark Law. WHA praised CMS for proposing potential ways to encourage more value-based payments, while also encouraging CMS to support more general reforms that reduce the overall burden of the Stark Law.

WHA commented in 2018 on a request for information from CMS about how it could help relieve unnecessary burdens on providers under the Stark Law. WHA recommended changes in four key areas:

1. Clarifying confusing definitions.
2. Providing clearer exceptions from the law.
3. Prioritizing intentional, rather than unintentional violations.
4. Harmonizing the Stark Law with the Anti-kickback Statute (AKS).

WHA praised CMS for making an effort to provide relief in three out of those four areas: clarifying confusing definitions, providing clearer exceptions, and syncing Stark Law with the AKS. While recognizing that CMS may be limited by statutory constraints on the issue of unintentional violations, WHA encouraged CMS to still do what may be in their power to make the Stark Law less heavy-handed or imposing regarding unintentional violations.

Perhaps most notable in the proposed rule from CMS is a new framework that would allow providers to obtain exceptions from the Stark Law if they agree to either take on some level of financial risk or participate in a value-based enterprise. For proposed exceptions which require providers to take on some level of financial risk, WHA recommended CMS lower the risk threshold from 25% to 10%, noting that its Public Policy Council members discussed concerns that few providers would be willing to take on such substantial risk if they are not currently doing so. For the same reason, WHA also strongly encouraged CMS to ensure the proposed value-based exceptions – which do not require providers to take on financial risk – remain a viable option in the final rule. These types of arrangements are the ones hospitals and health systems are most likely to utilize when looking to explore new value-based payment models. WHA also noted that Wisconsin is recognized as a state with some of the highest quality health care in the country, and that these types of exceptions have the most potential to help move more Medicare services away from a fee-for-service model to one that rewards and incentivizes high-value, high-quality health care.

See WHA’s comment letter or contact WHA Director of Federal & State Relations Jon Hoelter for more information.

This story originally appeared in the January 09, 2020 edition of WHA Newsletter