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CMS Seeks Relaxation of Kickback & Self-Referral Regulations

Posted in Fraud and Abuse

The Centers for Medicare & Medicaid Services (“CMS”) recently published proposed changes to the Anti-Kickback Statute and Stark Law to address concerns that these laws are too restrictive and not current with modern healthcare and therefore are stifling innovation and arrangements that may decrease health care costs.  The goal of the proposed revisions is to encourage coordinated care, which would allow for more partnerships in the healthcare industry.

However, the risks of scaling back on  the Anti-Kickback Statute or Stark Law are significant. These Federal healthcare regulations are designed to prohibit certain interactions amongst healthcare entities; yet despite such longstanding regulations, the Justice Department and other law enforcement agencies continue to expose schemes that exploit government health programs.  More recently, the government has focused on  the susceptibility of healthcare providers to be influenced by pharmaceutical companies and based on a studyfrom 2017, roughly half of US doctors received payments from the drug industry,which represents nearly $2.5 billion in pharmaceutical company spending.

Any changes to the Anti-Kickback Statute or Stark Law will need to balance the need for more flexibility in models that coordinate care while prohibiting improper conduct that results in inappropriate payments or services. The Comment Period for these proposed changes closed on August 24,2018 and comments can be viewed on the Federal Register here.

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