Commercial risk will be a critical catalyst of progress – it’s complicated, but is it possible? We think so.


June 25, 2018

Is the Stark Law hurting your shift to value-based care? CMS wants to know.

Daily Briefing

    CMS on Wednesday published a request for information to solicit industry feedback on a federal anti-kickback law and how it affects the industry's transition to value-based payment models.

    Background on the Stark Law

    The law, referred to as the Stark Law after former Rep. Pete Stark (D-Calif.), bans physicians from referring Medicare beneficiaries they are treating to entities in which they have a financial stake. Stark Law violations, including unintentional violations, can result in civil monetary penalties.

    The law includes certain exemptions, including one for "in-office ancillary services" that originally was intended for routine procedures such as in-office blood tests to allow for more efficient care delivery.

    Hospital and physician groups have argued that the federal anti-kickback law can inhibit providers' transition toward value-based payments, as it could punish a doctors for referring a patient to a provider within the doctor's accountable care organization, for which the doctor benefits from shared savings. But shared savings and streamlined service are the whole point of ACOs, Michael Munger, president of the American Academy of Family Physicians, said. "That's why we are actually doing this ... so you don't have duplication of services," he added.

    CMS Administrator Seema Verma earlier this year suggested Congress may need to intervene to reduce the law's impediments to value-based care. President Trump in his fiscal year 2019 budget proposed creating a new exemption for alternative payment models.

    CMS' request for information

    In the RFI, CMS posed 20 questions on how the agency could change the law to better account for value-based care models. For example, CMS asked stakeholders how they would apply the law to alternative payment models and whether the agency should instead explore transparency safeguards to address the role physicians' financial benefits plays in their medical decision-making.

    Stakeholders have until Aug. 24 to submit comments (Dickson, Modern Healthcare, 6/20; Williams, CQ Health, 6/21 [subscription required]).

    Just updated: Your cheat sheets for understanding health care's legal landscape


    To help you keep up with the ever-changing regulatory environment, we recently updated our cheat sheets on some of the most important—and complicated—legal landmarks to include a brand new one-pager on the new tax law.

    Check out the cheat sheets now for everything you need to know about MACRA, the Affordable Care Act, antitrust laws, fraud and abuse prevention measures, HIPAA, and the two-midnight rule.

    Get the Cheat Sheets

    Have a Question?


    Ask our experts a question on any topic in health care by visiting our member portal, AskAdvisory.