CMS Proposed Rule Amendments for Kickbacks, Monetary Penalty
- On Thursday, October 2, 2014, the Centers for Medicare & Medicaid Services (CMS) announced a proposed rule that would amend several programs including fraud and abuse, revisions to safe harbors under the anti-kickback statute and civil monetary penalty rules regarding beneficiary inducements and gainsharing.
According to the proposal, there is a growing need for regulatory action in the form of codifying statues that are already on the books. This is the process of creating codes, which are compilations of written statutes, rules and regulations. When completed, it rearranges and displaces prior statutes and case decisions and in the area of law, constitutes the entire source of information used to answer a legal question.
The proposal will also look to make technical corrections to existing regulations as a way to make them low risk to Federal health care programs. Each of the proposed rules is independent of the others, meaning they could be enacted separately.
Here is a quick rundown on the details of the proposed rule:
Anti-kickback statute and Safe Harbors
There are several anti-kickback statue exceptions currently in place that were created by the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA), the Patient Protection and Affordable Care Act of 2010 (ACA) and the Balanced Budget Act of 1997 (BBA). These are important because they protect certain payment practices and business arrangements from criminal prosecution or civil sanctions.
The proposal would modify certain existing safe harbors while also creating new safe harbors that would provide additional protection or codify existing protections.
These include:
• A technical correction to existing safe harbor for referral service
• Protection of certain cost-sharing waivers for pharmacies and emergency ambulance services
• Protection for certain remuneration between Medicare Advantage organizations and federal qualified health centers
• Protection for discounts by manufacturers on drugs furnished to beneficiaries under the Medicare Coverage Gap Discount Program
• Protection for free or discounted local transportation services that meet specified criteria.
Civil Monetary Penalty Authorities
This aspect would amend the definition of “remuneration” by added certain statutory exceptions. These would include copayment reductions for certain hospital outpatient department services, certain remuneration that poses a low risk of harm and promotes access to care, coupons, rebates or other retailer reward programs that meet specified requirements, certain remuneration to financially needy individuals and copayment waivers for the first fill of generic drugs.
Under these changes is also the idea to codify gainsharing civil monetary penalties that were set forth in the Social Security Act. Currently, these provisions have not been codified.
Costs and benefits
There are no significant costs associate with the proposed regulatory revisions that would impose mandates on State, local or tribal governments or on the private sector.
