e. Does not result in medically unnecessary or inappropriate items or services reimbursed in whole or in part by a Federal health care program. Biobay Industrial Park . (ii) Have a governing document that describes the VBE and how the VBE participants intend to achieve its value-based purpose(s). OIG also clarified that the risk can be prospective or retrospective, including calculations compared to a benchmark. OIG also removed the specific 60 percent discount that was included in the proposed rule for partial capitation. Click here for a confidential contact or call: Fraud Related to Electronic Health Records, government enforcement actions to stop unlawful kickbacks, Contact us for a Confidential Consultation, Increased program costs for Medicare, Medicaid, and other payors, Hospitals, nursing homes, labs, dialysis centers, drug, or DME companies paying, Hospitals, nursing homes, labs, dialysis centers, drug or DME companies, Hospitals paying their employed physicians salaries or “, Hospitals, dialysis companies, or other providers, Drug companies, DME companies, and providers of skilled therapy, Payments by specialty pharmacies, DME suppliers, therapy centers, nursing homes, etc. The requirement to make referrals does not apply if: the patient expresses a different preference; the patient’s payor determines the referral; or. Start Preamble Start Printed Page 77684 AGENCY: Office of Inspector General (OIG), Department of Health and Human Services (HHS). Basically, anything of value to a person in a position to refer, such as cheap office space, patients referrals, a free employee, or a fat bonus, can classify as an illegal inducement under the Anti-Kickback and Stark laws. }, { This safe harbor does not require parties to bear or assume downside financial risk. ", Thus, this creates the possibility that when a value-based arrangement exists in the chain of financial relationships, the indirect compensation exception may technically not be available to protect the relationship. "@type": "Answer", ACTION: Final rule. The VBE must assume full financial risk (or is contractually obligated to be at full financial risk within the 12 months following the commencement of the value-based arrangement) during the entire duration of the value-based arrangement. "acceptedAnswer": { OIG revised the exclusion of these entities as VBE participants to recognize the role they may have, while denying protections for most arrangements involving these entities. Crossing State Lines: Interstate Travel in New England During the... EPA PFAS Regulations: “PFAS A Priority” Says Incoming Administrator. 1 Note that value-based models may raise separate fraud and abuse concerns, such as ensuring that arrangements do not encourage providers to limit medically necessary care. The outcome or process measures against which the recipient will be measured. § 1320a-7b(b), covers a broader range of activity than the Stark Law, and extends to all medical providers in a position to arrange or recommend medical services. Access Requests Are Just a CCPA Thing, Right? Coordinating and managing the care of a target patient population. She has also advised clients regarding Medicare fraud and abuse issues, reimbursement and antitrust issues. In January 2019, the administration proposed to change the safe harbor protections granted under the Anti-Kickback Statute to exclude protections for drug company rebates to PBMs and Medicare Part D and Medicaid managed care plans. { } One example provided by CMS is that a VBE could not receive protection under a value-based Stark Law exception for a value-based arrangement between an entity and a physician that are VBE participants in the VBE if, as part of the arrangement, the entity requires the physician to refer Medicare patients who are not part of the target patient population for designated health services furnished by the entity.14 Similarly, the value-based AKS safe harbors do not provide protection for value-based arrangements that condition an offer of remuneration on: (i) referrals of patients that are not part of the value-based arrangement’s target patient population, or (ii) business not covered under the value-based arrangement.15. Under certain state laws the following statements may be required on this website and we have included them in order to be in full compliance with these rules. Section 1128B(b) of the Act, the anti-kickback statute, provides for criminal penalties for whoever knowingly and willfully offers, pays, solicits, or receives remuneration to induce or reward the referral of business reimbursable under any Accordingly, CMS finalized in the Stark Final Rule an amendment to the indirect compensation exception to address this issue. This “thing of value” can be as simple as cash, or as complex as a carefully constructed physician employment agreement or the right to invest in a profitable joint venture. The National Law Review - National Law Forum LLC 4700 Gilbert Ave. Suite 47 #230 Western Springs, IL 60558 Telephone (708) 357-3317 or toll free (877) 357-3317. As more providers move to downside risk arrangements in the market, the protections of the significant risk share arrangement exceptions and safe harbors are likely to have the most impact on providers. Ms. Cherian has experience litigating health care matters... Steven Pine is a partner in the firm’s health care practice group. Cementing Victory by Accepting Defeat: When Can a Patentee’s Infringement Disclaimer Moot an Appeal of an IPR Decision? } Court Held That An Heir Of An Estate Who Released All Claims Against... Corporate Transparency Act: New Requirements to Disclose Ownership... Just Formed a Company? Workplace Safety Review: Episode 10 | OSHA Enforcement: Its History... OSHA Finally Releases Guidance on Mitigating and Preventing COVID-19... DOE Requests Input On Its Draft Plastics Innovation Challenge Roadmap, Competition Currents February 2021: The Netherlands, Poland and Italy, Divided Indiana Court of Appeals Issues Landmark Divorce Tax Decision, Executive Orders Impact Federal Agencies and Government Contractors. The Stark Meaningful Downside Risk exception is meant to protect remuneration paid under a value-based arrangement where both the physician and VBE take on downside financial risk under a payor arrangement. While the Anti-Kickback Statute covers a broad range of activity, it also requires a showing of an “intent to induce referrals.” The criminal provisions of the Anti-Kickback Statute are violated where something of value is “knowingly and willfully” provided with a purpose to induce referrals. Like OIG, CMS increased the time period before the VBE must be a full financial risk to one year from six months as originally set forth in the proposed rule. The Stark Law, unlike the Anti-Kickback Statute, flatly prohibits a broad range of financial relationships, and does not require proof of an intent to induce referrals. Notable requirements to meet this safe harbor include the following: (i) Goods, items, and services given to target patient populations as patient engagement tools or supports are provided directly to patients by VBE participants (or their agents); (ii) The patient engagement tool or support must not be funded or contributed by a VBE participant that is not a party to the applicable value-based arrangement, or by the list of enumerated entities that cannot rely on the value-based AKS safe harbors as set forth in Section II.C (e.g., pharmaceutical companies); (iv) For a period of at least 6 years, the VBE participant makes available to the Secretary, upon request, all materials and records sufficient to establish compliance; (v) The availability of a tool or support is not determined in a manner that takes into account the type of insurance coverage of the patient. While these flexibilities provide exciting new opportunities for payors and providers—especially when providers are prepared to take on risk—they can only be taken advantage of through careful structured arrangements that satisfy a series of requirements set forth in the Final Rules. Monetary and in-kind remuneration paid under a value-based arrangement. Such coordination could involve the use of care managers, providing care or medication management, creating a patient-centered medical home, helping with effective transitions of care, sharing and using health data to improve outcomes, or sharing accountability for the care of a patient across the continuum of care. Decide if the clause should be open and unqualified or a closed list of force majeure events. 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). § 1395nn, “referrals” are limited to certain types of medical services, such as lab testing, hospital services, prescription drugs, and durable medical equipment, defined as “designated health services.” In addition, the Stark Law applies only to relationships with physicians. The following chart shows the key requirements under each arrangement: In-kind remuneration only under arrangements used predominantly to engage in value-based activities that are directly connected to the coordination and management of care for the target patient population and which does not result in more than incidental benefits to persons outside of the target patient population. This has resulted in a concerted move toward value-based models that tie provider reimbursement to increased quality, reduced costs, enhanced care coordination, and improved patient outcomes. If you require legal or professional advice, kindly contact an attorney or other suitable professional advisor. CMS intends for the value-based purpose of the arrangement to relate to the VBE as a whole. For arrangements that are designed and implemented to fit within the parameters set forth in the Final Rules, providers will be able to take advantage of operating outside the purview of many traditional fraud and abuse safeguards. “Referrals” under the Anti-Kickback Statute include “any item or service for which payment may be made in whole or in part under a Federal health care program.”. In addition, this safe harbor also contains several limitations and protections found within the care coordination safe harbor, notably that the remuneration must at a minimum further the coordination and management of care for the target patient population. The Anti-Kickback Statute and Safe Harbors . EPA Announces the Issuance of a Revised Advisory on Disinfectants... COVID-19: US State Policy Report – February 2, 2021. Cal/OSHA’s ETS Under Scrutiny: California Judge Hears Oral Argument... Court Denies Motion for Class Certification in Employee W-2 Data... NLRB Acting General Counsel Rolls Back Guidance from Prior... OSHA Issues ‘Stronger’ Workplace Guidance on COVID-19, China Sanctions Two Firms for Filing “Abnormal” Patent Applications. In addition to potential AKS barriers, such assistance can also be problematic under the beneficiary inducements CMP law, which penalizes remuneration to a beneficiary when the offeror knows or should know the remuneration is likely to influence the selection of a provider. Immigration Weekly Round-Up: New Executive Orders; Deportations... Mexico’s COVID-19 Traffic Light Monitoring System: News for February... California Employers Should Be Aware of Updates to Leave Requirements, New ITC 337 Investigation Powered by Battery Design Patents. However, the AKS Final Rule prohibits certain types of organizations from relying on value-based safe harbors. The AKS safe harbor for care coordination arrangements protects in-kind remuneration exchanged between qualifying VBE participants in a value-based arrangement connected to the coordination and management of care of the target patient population.10 Under this safe harbor, each offer of in-kind remuneration among VBE participants must be analyzed separately for compliance with the safe harbor. Like OIG, CMS addressed questions regarding stop-loss by not limiting an amount of loss mitigation but indicating that such mitigation should not shift material financial risk to the payor.20. The target patient population for the arrangement. Attorney Advertising Notice: Prior results do not guarantee a similar outcome. Unless otherwise noted, attorneys are not certified by the Texas Board of Legal Specialization, nor can NLR attest to the accuracy of any notation of Legal Specialization or other Professional Credentials. Creating a Successful Smart Manufacturing Environment for Small and... Federal Guidance on Mandating Employee COVID-19 Vaccinations. Does not include marketing to patients of items or services furnished by the VBE or a VBE participant, or engaging in patient recruitment activities. The exception does not protect a “side” arrangement between two VBE participants that is unrelated to the goals and objectives (that is, the value-based purposes) of the VBE of which they are participants, even if the arrangement itself serves a value-based purpose.13. The six safe harbors and exceptions set forth by OIG and CMS are as follows: a. Some states have laws and ethical rules regarding solicitation and advertisement practices by attorneys and/or other professionals. "@type": "Question", One key component of this safe harbor is the requirement that the recipient pay 15 percent of either: (i) the offeror’s cost, or (ii) the fair market value of the in-kind remuneration. At the same time, however, CMS and OIG have included a robust set of requirements and safeguards within each of the new exceptions and safe harbors, which help ensure that the arrangements are structured to drive providers toward clear value-based goals. "@type": "FAQPage", One example CMS uses is a skilled nursing facility providing a hospital with staff to assist in coordinating patient care through the inpatient discharge process. f. It is recommended by the patient’s licensed health care professional and advances one or more of the following goals: Prevention or management of a disease or condition; or. Determining whether a particular financial relationship runs afoul of the Stark Law, however, can be more technically complicated." While they are generally excluded from protections under the safe harbors, as discussed below, certain durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) providers and suppliers that qualify as limited technology participants may utilize the care coordination arrangements safe harbor for arrangements involving digital health technology. (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 Rule, the Final Rules). White Paper: Value-Based Safe Harbors and Exceptions to The Anti-Kickback Statute and Stark Law. “Substantial downside financial risk” means, for the entire term, in the form of (each tied to historical expenditures): Shared loss arrangements including financial risk equal to at least 30 percent of any loss calculated by comparing current expenditures for all items and services that are covered by the applicable payor and furnished to the target patient population to a bona fide benchmark. (iii) As shown in the chart below, OIG has not limited the types of individuals and entities that may participate in a VBE. Cementing Victory by Accepting Defeat: When Can a Patentee’s... USCIS Announces H-1B Lottery Process Unchanged. Biden Directs Review of Immigration Policies, Seeks to Reduce... Supreme Court Decides Salinas v. Railroad Retirement Board, New York City Amends Fair Chance Factors Under Ban-the-Box Law. Statement in compliance with Texas Rules of Professional Conduct. In advance of, or contemporaneous with, the commencement of the value-based arrangement or any material change to the value-based arrangement, the VBE and VBE participant must set forth the terms of the value-based arrangement in a signed writing that contains the requirements listed in the Final Rule. DC Circuit Vacates Trump Administration’s Affordable Clean Energy Rule. To understand what this means, a helpful place to start can be focusing on what is required to be at the heart of any permissible arrangement—the arrangement’s “value-based purpose.” Every protected arrangement must have, at its core, one or more value-based purposes, which are defined as: (i) Coordinating and managing the care of a target patient population; (ii) Improving the quality of care for a target patient population; (iii) Appropriately reducing the costs to or growth in expenditures of payors without reducing the quality of care for a target patient population; or, (iv) Transitioning from health care delivery and payment mechanisms based on the volume of items and services provided to mechanisms based on the quality of care and control of costs of care for a target patient population.2, While there may be other goals to an arrangement, at least one of these enumerated value-based purposes is necessary. 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