The CMS issued interim final regulations creating new exemptions to the ban on physician self-referral and clarifying existing "safe harbors" for physician investments and compensation arrangements. The regulations also update existing law to reflect an 18-month moratorium on physician investment in new specialty hospitals, which was established by the 2003 Medicare reform law. The self-referral regulations -- to be published in Friday's Federal Register and which take effect July 24 -- follow up on the agency's 2001 finalization of the so-called Stark laws, named after their chief proponent, Rep. Pete Stark (D-Calif.). The laws ban physician referrals to certain types of clinical facilities in which the doctors have financial interests. As part of its update to the self-referral laws, the CMS elaborated on the types of compensation arrangements hospitals can legally offer physicians and for the first time included technology or services provided to enable physician participation in community health-information systems. The CMS also eliminated a proposed restriction on productivity-based bonuses for physician employees, but said such bonuses must be based on physicians' personal productivity and not their referrals for ancillary services. Read the CMS release.
In other Washington news, HHS said it has approved 28 sponsors of drug discount cards for Medicare enrollees, and the companies may begin enrolling seniors in May. The program, created by the recently passed Medicare reform legislation, becomes effective June 1. -- by Tony Fong