CMS Nails Down Its Stark Law Changes
Wednesday, December 2nd, 2020

Recently, the Centers for Medicare and Medicaid Services added the finishing touches to its Physician Self-Referral Rule revisions, commonly referred to as the Stark Law. The law forbids a doctor from referring a patient for several forms of services to a provider owned by the doctor, under their employment, or otherwise getting payment from them.

The old federal rules were meant for reimbursing providers on a fee-for-service basis, in which further services were supplied as a financial reward. These federal regulations have weighed down hospitals with increased operating expenses and obstructed the transition towards value-based compensation. The healthcare sector, nevertheless, is proceeding steadily toward financial reimbursement systems related to value.

CMS’ move comes as self-referral does not have the same risks as before since providers are increasingly more responsible for patients’ total cost of care. Lack of clarity in the Stark legislation, however, has caused many providers to stay put, afraid of breaking the law even with favorable agreements, which may have critical and expensive implications.

The law finalizes several of the draft policies from the October 2019 notification of planned rulemaking. All the provisions in the revised Stark law are expected to be in effect within sixty days from the Federal Register display date, unless stated otherwise.

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