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On 2 December 2020, the U.S. Department of Health and Human Services’ (HHS) issued two Final Rules in conjunction with its “Regulatory Sprint to Coordinated Care,” which will markedly change the regulatory fraud and abuse landscape for “value-based” arrangements:
The HHS Office of the Inspector General (OIG) published a Final Rule that introduces new safe harbor protections under the federal Anti-Kickback Statute (AKS) for certain coordinated care and risk-sharing value-based arrangements between or among clinicians, providers, suppliers, and others that squarely meet all safe harbor conditions (AKS Final Rule).
Predictions in the current antitrust, regulatory and legislative environments are hard – there is just too much happening. The better insights might be reached by thinking through what the bigger questions might be for example, some things to think about as we approach 2021 and contemplate where a new administration in Washington and evolving antitrust enforcement regimes and priorities will take the health care industry. Will the FTC continue to pursue health system and hospital mergers and affiliations aggressively, as it did in 2020? Will its loss in the Eastern District of Pennsylvania, regarding the Jefferson-Einstein merger, be upheld on appeal? Or will the “market realities” aspect of market definition cause the FTC to refocus its efforts and analysis?
“Full Financial Risk”
A. Overview of Key Safe Harbors and Exceptions
An important initial consideration is that there are multiple differing requirements between corresponding Stark Law exceptions and AKS safe harbors. Stakeholders must navigate the requirements under both regulatory regimes for arrangements that potentially implicate each law. Although a number of commenters sought a unified set of requirements between Stark Law and AKS requirements, CMS and OIG rejected this approach, noting the different purposes of each law. In general, CMS provides more flexibility for Stark Law exceptions, given its strict liability standard. In contrast, OIG felt it was appropriate for the AKS which is an intent-based law to serve as “backstop” protection for arrangements that implicate both laws. The six safe harbors and exceptions set forth by OIG and CMS are as follows:
Tuesday, February 2, 2021
On 2 December 2020, the U.S. Department of Health and Human Services’ (HHS) issued two Final Rules in conjunction with its “Regulatory Sprint to Coordinated Care,” which will markedly change the regulatory fraud and abuse landscape for “value-based” arrangements:
(i) The HHS Office of the Inspector General (OIG) published a Final Rule that introduces new safe harbor protections under the federal Anti-Kickback Statute (AKS) for certain coordinated care and risk-sharing value-based arrangements between or among clinicians, providers, suppliers, and others that squarely meet all safe harbor conditions (AKS Final Rule).
(ii) The HHS Centers for Medicare & Medicaid Services (CMS) published a Final Rule that finalizes similar exceptions to the Physician Self-Referral Law (Stark Law) for certain value-based compensation arrangements between or among physicians, providers, and suppliers (Stark Final Rule, and together with the AKS Final
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As discussed in our Client Alert issued on December 10, 2020, the Centers for Medicare & Medicaid Services (CMS) and the Department of Health and Human Services Office of Inspector General (OIG) issued two long-awaited final rules that modernize and change the Stark Law and Anti-Kickback Statute (AKS) regulations. The final rule involves numerous changes, including long-awaited changes to the personal services and management contracts safe harbor under the AKS. This alert addresses key changes to the personal services and management contracts safe harbor of the AKS to enable greater flexibility for payment arrangements in value-based models.