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Stark and Antikickback Statute Reforms on the Way?

Federal Fraud and Abuse Regulations

At a Brookings Institution event last month, Eric Hargan, Deputy Secretary of the Department of Health and Human Services (HHS), announced that the agency will be issuing proposed rules to revise federal fraud and abuse regulations that are seen as hampering care coordination and the transformation to a value-based health care system.

Last summer, both the Centers for Medicare and Medicaid Services (“CMS”) and the Office of Inspector General (“OIG”) issued Requests for Information (RFI) asking how the Stark and Antikickback Statutes may be hindering care coordination and efforts to move to a value-based health care system.  HHS received 375 comments (in over 3,500 pages) on the Stark RFI.  The most often cited issues in the comments were the need for greater clarity in the regulatory definitions such as fair market value and commercial reasonableness.  The RFI is part of HHS’ Regulatory Sprint to Coordinate Care initiative, which is “focused on identifying regulatory requirements or prohibitions that may act as barriers to coordinated care, assessing whether those regulatory provisions are unnecessary obstacles to coordinated care, and issuing guidance or revising regulations to address such obstacles and, as appropriate, encouraging and incentivizing coordinated care.”

Hargan noted that the CMS and the OIG are coordinating their proposed reforms to the Stark and Antikickback Statute, which he said should be released “soon.”

Hargan noted that the existing laws may encourage health care industry consolidation as hospitals concerned with fraud and abuse risks with care coordination acquire physician practices rather than contract with them to manage and coordinate care.  Hargan noted the importance of competition in the healthcare marketplace, but said care coordination and competition “don’t need to be at odds.”

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