Stark regs tightened on physician group pay for ancillaries: 5 details

The Stark regulations governing pay methodology for ancillary services in group practices will change Jan. 1, prompting some organizations to rewrite their policies.

Shumaker, Loop & Kendrick outlined the updates in a report from JDSupra.

Five details:

1. CMS will require medical practices to set the methodology for calculating distribution from designated health services, or ancillary services, prospectively. The methodology for distributing profits from services like imaging and physical therapy should be locked in before groups earn income from those services.

2. Medical groups are not able to tie ancillary distributions directly to physicians ordering the service. Instead, groups can split profits "on a prorata basis or based on personal professional productivity (excluding any revenues from the provision of [designated health services] or DHS encounters)," according to the report.

3. CMS clarified medical groups are required to allocate profits, not revenues, from the ancillary services, in a Dec. 2, 2020, announcement.

4. Medical groups will be required to use the same methodology for calculating ancillary service distribution for all service lines. Large groups can use different methodologies for allocating profits to subgroups of at least five physicians within the larger organization.

5. The final rule also made it clear that distribution methodology can't be based on the volume of services a physician orders for non-Medicare patients.

Click here for additional Stark Law updates.

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