Caravan Health Founder Lynn Barr and Neal Shah, a shareholder in Polsinelli’s health care law practice, recently presented a webinar explaining the details about two newly released proposed rules. These highly anticipated rules propose exceptions to the Physician Self-Referral Law (Stark Law) and safe harbors for the Anti-Kickback Statute (AKS) that would make it easier for providers to participate in value-based health care arrangements. For those who missed it, the webinar is available here.
 
The Stark and AKS laws are intended to prevent waste, fraud, and abuse in health referral arrangements. Put simply, these laws prohibit providers from financially benefiting from certain health care referrals. The laws were designed to ensure that patients receive the best available care without inappropriate financial considerations by providers.  
 
When these laws were enacted several decades ago, health providers were paid mostly based on the volume of services provided. With the growth of value- and performance-based payment, HHS recognized that these laws could impede innovative arrangements that would promote the triple aim of higher quality, better experience, and lower costs. For example, value-based arrangements often rely on care coordination that could be impermissible under the laws.
 
These proposed rules include exceptions and safe harbors for value-based arrangement that both include risk or do not include risk. There are rigorous requirements for arrangements without financial risk, including structure of the arrangement, outcome measures, and ongoing monitoring. The rules for risk-bearing entities are somewhat different, but the level of risk required is significant.  For the Stark proposed exceptions, the risk must be directly on the physician. For the AKS safe harbors, the value-based model and the participant must bear risk.
 
The rules are very complex and detailed, but they could clear the way for many providers to participate more easily in value-based care. It’s important to note that ACOs already have access to broad fraud and abuse waivers that cover certain potential Stark and AKS violations. These new proposed rules do not change any of those options already available. HHS is accepting comments on these proposed rules until December 31, 2019.

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