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Stark Law under the spotlight as CMS seeks to ease self-referral regulatory burden, MedPAC cracks down on PODs

Changes could be coming to Stark Law.

Yesterday, CMS began seeking input on reducing the regulatory burden of Stark Law to allow for more care coordination between organizations. The June 2018 MedPAC report also addressed potential Stark Law changes, focused on tightening the language to prohibit physician self-referral associated with physician-owned distributorships.

The MedPAC report suggests revising Stark Law to eliminate the "per unit of service" rule for PODs and making PODs an entity of DHS. Under this change, physicians would not be able to refer patients to using PODs they had ownership in, with few exceptions. MedPAC also aims to have PODs identified as PODs in the Open Payments reporting program, which requires companies to disclose provider payments.

"The goal of any change to the Stark Law would not be to ban PODs per se, but rather to prohibit physician self-referral involving PODs," the report states.

But when it comes to self-referral related to care collaboration, CMS is seeking ideas to reduce the regulatory burden and allow providers to collaborate more closely. The agency solicited comments about areas of high regulatory burden, and more than 2,600 comments mentioned Stark Law compliance as one of those areas. CMS reviewed existing regulations and in coordination with HHS Deputy Secretary Eric Hargan, the agency is collecting input on better understanding and addressing provider concerns about Stark Law.

"Removing unnecessary government obstacles to care coordination is a key priority for this administration," said Mr. Hargan. "We need to change the healthcare system so that it puts value and results at the forefront of care, and coordinated care plays a vital role in this transformation."

In particular, CMS is looking for input on structuring arrangements between parties that participate in alternative payment models and other new financial arrangements to revise Stark Law or add as an exception. The public comment period runs through Aug. 24, 2018.

"We are looking for information and bold ideas on how to change the existing regulations to reduce provider burden and put patients in the driver's seat," said CMS Administrator Seema Verma. "Dealing with the burden of the physician self-referral law is one of our top priorities as we move towards a healthcare system that pays for value rather than volume."

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