Proposed overhaul of anti-kickback rules part of 'sprint to coordinated care,' HHS official says

Citing efforts to improve coordinated care for patients, the HHS Office of Inspector General and CMS recently proposed an overhaul to the federal Anti-Kickback Statute and Stark Law.

The proposed rules would allow value-based care arrangements to qualify for exceptions to the federal regulations designed to combat Medicare and Medicaid fraud and abuse.

The overhaul aims to make regulatory compliance easier for healthcare providers and advance the industry's shift from fee-for-service to value-based care, HHS said.

Becker's Hospital Review recently caught up with HHS Deputy Secretary Eric Hargan to discuss the initiative.

Question: What prompted the proposed rules?

Eric Hargan: The proposals are there as part of what we call the Regulatory Sprint to Coordinated Care (The initiative even has its own hashtag #RS2CC). We intend to empower patient engagement and connectivity and provide patients a way to get better treatment and make decisions themselves.

Q: CMS proposed rules include safe harbor exceptions to the Stark Law for certain value-based models. Can you expand on these exceptions? What are they and why were they included?

EH: They were included because we think care coordination is essential to value-based care, that we cannot get to a state of outcomes without different providers and different sites of care being able to coordinate with each other and provide incentives toward outcomes. We would have had to undertake these reforms at some point to get to value-based care because these regulations as they currently stand tie us to the older [payment] system [fee-for-service]. Every year fewer people are in that system, so we want to enable the continued transition to a value-based system.

We are also providing flexibilities in the private sector to engage in these value-based arrangements because some of our rules apply broadly to everyone in healthcare. We want to reform these regulations to encourage and facilitate care coordination.

For example, we propose to expand one of the current safe harbors, which protects personal services and management services arrangements, to allow for outcomes-based payments. If finalized, the expanded safe harbor could protect various types of outcomes-based payments, including shared savings payments, shared losses payments and pay-for-performance payments. We believe this additional flexibility may change how payment and incentives work in services and management arrangements.

We are also proposing to allow patient engagement and support tools to be given to patients to allow better care, subject to limitations.

Q: CMS proposed rules also extend safe harbor exceptions to Stark Law to donations of EHRs and other cybersecurity technology. Why was the cybersecurity piece specifically included?

EH: That was partially due to public comments that came in in response to our request for information about these issues. In healthcare, we have focused more on cybersecurity because patients have to be able to have safe data and secure data. And the healthcare system more broadly is one area where we think there's a lot of work to be done in cybersecurity.

So we wanted to facilitate the healthcare sector being able to fund this and donate it. We know small physician practices, or individual physician practices in many cases, are not able to afford a full range of cybersecurity software, and if hospitals wanted to donate it to them to protect the hospitals from attacks that came through a physician office and to protect patient data, that they would be able to do that.

And for patients to share their data, privacy and security is key, so if providers have secure technology, we think there is going to be a lot more trust in the system, and we think we need that as well. Providers won't coordinate with each other unless they know patient data is secure.

Q: Additionally, CMS is proposing new safe harbors under the Anti-Kickback Statute for remuneration exchanged between certain participants in value-based arrangements. Why were these included?

EH: Healthcare providers want to be able to provide tools to patients or to other providers, in some cases. For example, a mother brings her child in for an ear infection, and they send the kid home with medicine. But what if the hospital could also send home an otoscope that's connected digitally to the hospital system? Then instead of coming back to see if the ear infection's cleared up, which is hard for a mother to see, the mother can put the otoscope in the kid's ear, [and the physician] can look at it at [electronically from] the hospital, and there's no need for multiple trips to the hospital or office, which is great for everyone involved and no need for a return journey every day to see if infection is cleared up. They can see if it's done it on their own.

That wouldn't be able to be done today because people might say it's a donation of an item through the mother.

We looked at the statutes with fresh eyes … and the definitions and how rules would be carried out. We believe we can offer these flexibilities to healthcare providers to organize themselves ultimately for better outcomes for the patient.

Q: What are the next steps with the proposed rules?

EH: The public comment period closes at the end of the year. We'll move as quickly as possible after that closes to address those comments and prepare the final rules.


More articles on legal and regulatory issues:

Tenet agrees to pay $66M to resolve kickback lawsuit
Ex-CMO sues Wyoming hospital for $38M, says he was forced to resign for reporting substandard care
Judge blocks health insurance requirement for immigrant-visa applicants

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