Federal regulators pushed back an update to the self-referral law to August 2021, HHS and CMS announced Wednesday.
The agencies delayed the finalization of the Stark law proposed rule that aims to facilitate more data sharing between providers and suppliers, incentive pay under CMS-approved care models and donations of cybersecurity technology, among other provisions that were slated for final action this month. The COVID-19 pandemic delayed the process, and CMS and HHS are still "working through the complexity of the issues raised by comments received on the proposed rule," they wrote in a notice sent Wednesday. CMS and HHS did not say whether the Anti-Kickback Statute rulemaking process was also delayed.
Policymakers and providers criticized the delay, claiming that COVID-19 emphasized the need for the proposed regulatory rework.
"The reforms, which would allow independent physicians to participate fully in value-based payment models, were important before the COVID-19 pandemic, but are even more significant now," the Digestive Health Physicians Association said in a statement. "These needed regulatory changes will create a more level playing field and protect private practices from increasing consolidation driven by hospitals and health systems."
"As a result of this delay, we can expect that the innovation the administration is so committed to unlocking will remain stymied until CMS finalizes the Anti-Kickback Statute (and Stark) proposed rules," Dr. Richard Harris, president of the Large Urology Group Practice Association, said in prepared remarks, adding that the association has been championing the transition from fee-for-service to value-based care models since 2015's bipartisan passage of the Medicare Access and CHIP Reauthorization Act.
More than 70 congressional members wrote to the agencies Tuesday to ask them to finalize the proposed rules for the Stark law and Anti-Kickback Statute soon as well as consider safe harbor provisions for device manufacturers; manufacturers, distributors or suppliers of durable medical equipment, prosthetics, orthotics or supplies; laboratories; and pharmaceutical manufacturers.
"Previous letters led by various members signed below have provided examples of ways these entities can improve care for patients, and we continue to believe that excluding particular entities will limit the positive impact of the proposed changes," the letter reads.
Officials and providers argue that the Stark law, which was originally implemented in 1989 to prevent physicians from profiting off referrals to Medicare providers that they or a family member had a financial stake in, has deterred them from participating in payment models where physicians and hospitals share the financial rewards for delivering lower costs and higher quality.
Carving out permanent exceptions for certain value-based arrangements via safe harbor provisions that eliminate potential financial penalties could pave the way for broader participation, stakeholders commented.
But employers, among others, are worried that avoiding physician self-referral penalties at any level risk could boost fraud without encouraging participation in value-based payments. It could even undermine the government's efforts to get providers to take on more risk if doctors and hospitals can get the exception with relatively low levels of risk, they cautioned.
Regulators have implemented waivers amid COVID-19 that have mirrored the intention of the Stark law and Anti-Kickback proposed rules, but they will end alongside the national and public health emergencies.
Significant changes to the Stark law would likely require another notice-and-comment period, similar to the proposed rules last fall. While HHS has more flexibility to carve out additional safe harbor provisions under the Anti-Kickback Statute, neither CMS or OIG is likely to move forward with additional rule changes, experts said.
Correction: The initial story incorrectly stated that both the Stark law and Anti-Kickback Statute finalized rulemaking processes were delayed. The delay only affects the Stark law; the story has been updated.