OIG Mulls Anti-Kickback Statute Changes to Boost Value-Based Care

August 30, 2018 - HHS is looking to make sweeping changes to healthcare fraud and abuse laws. As the comment period for a CMS Request for Information (RFI) on the Stark Law closed, the HHS Office of the Inspector General (OIG) released a new RFI on the anti-kickback statute.

The HHS watchdog is looking for stakeholder feedback on ways in which the agency might modify or create new safe harbors to the anti-kickback statute, which imposes criminal penalties on individuals who knowingly pay, solicit, offer, or receive remuneration to induce or reward referrals.

OIG also called on stakeholders to identify ways in which the agency can alter or develop exceptions to the beneficiary inducements civil monetary penalty (CMP) definition of “remuneration.” The CMP regulation imposes penalties against individuals who offer or transfer remuneration to a Medicare or state healthcare program beneficiary to influence the beneficiary’s selection of a provider or supplier.

The OIG RFI contained a broad range of questions and topics the agency wants stakeholders to comment on, including:

• Care coordination and value-based care: What potential value-based care and reimbursement arrangements the industry is interested in that may implicate the anti-kickback statute or beneficiary inducements CMP and how “value” should be defined when creating safe harbors and exceptions to the healthcare fraud and abuse rules
• Beneficiary engagement: What types of incentives providers and suppliers are interested in providing to beneficiaries and how those incentives would improve care quality, care coordination, and patient engagement
• Cost-sharing obligations: How relieving or removing beneficiary cost-sharing obligations could improve care delivery and support value-based care models
• Intersection of physician-self referral law and anti-kickback statute: How should the physician self-referral law exceptions and anti-kickback statute safe harbors align

OIG is also soliciting feedback on current healthcare fraud and abuse waivers, cybersecurity-related items and services, the ACO beneficiary incentive program, and telehealth.

READ MORE: How Providers Can Detect, Prevent Healthcare Fraud and Abuse

Stakeholders have until Oct. 27, 2018 to submit comments to the OIG.

The OIG RFI comes on the heels of a CMS solicitation for comments on potential changes to the Stark Law, or physician self-referral law. The federal agency issued an RFI on the Stark Law in June 2018 and the comment period ended Aug. 24, 2018.

Through the RFI, CMS aims to uncover how the Stark Law impedes care coordination and provider participation in value-based care models. The federal agency called on stakeholders to also identify types of value-based arrangements providers participate in and what revisions or exceptions to the physician self-referral law are needed to support those arrangements.

Both RFIs are part of the Regulatory Sprint to Coordinated Care initiative led by HHS Deputy Secretary Eric Hargan. The initiative aims to identify regulatory provisions that hinder coordinated care and issue guidance on or revisions to the regulations that impede value-based care.

“Removing unnecessary government obstacles to care coordination is a key priority for this Administration,” Hargan said in June 2018. “We need to change the healthcare system so that it puts value and results at the forefront of care, and coordinated care plays a vital role in this transformation.”

READ MORE: DoJ Memo Limiting Guidance Use to Impact Healthcare Fraud Cases

Providers are answering HHS and its agencies, providing advice on how to improve existing healthcare fraud and abuse laws to support value-based care.

How providers are responding to healthcare fraud law requests

Providers agree that the Stark Law, anti-kickback statute, and other healthcare fraud and abuse regulations prevent coordinated care and value-based care participation.

“New innovative models of care present a challenge for regulators who want to improve care coordination and outcomes via incentivized value-based arrangements without creating legal uncertainty in advancing these goals,” recently stated Jerry Penso, MD, MBA, AMGA’s President and CEO. “CMS is in a difficult position, but there are regulatory improvements, however incremental, that can be made to Stark.”

In AMGA’s comment on the CMS RFI, Penso identified the incremental regulatory improvements as giving providers enough time to unwind practices established under a payment model with Stark Law waivers should a provider exit the model and keeping waivers in place if providers participate in similar non-Medicare alternative payment models.

However, the AMGA ultimately called for Congressional action to permanently alter the healthcare fraud and abuse law. Congressional action would ensure providers do not have to rely on a patchwork of waivers to participate in value-based care models.

READ MORE: OIG Releases Healthcare Fraud Compliance Program Guidelines

On the other hand, the American Hospital Association (AHA) specifically urged HHS to develop general value-based reimbursement exceptions to the Stark Law.

“To reach the full potential of a value-based system, the Stark compensation regulations must be reframed to meet the objectives of the new system, through the creation of a new exception designed specifically for value-based payment methodologies, and reforms to the personal services, employment, and risk sharing exceptions,” the industry group wrote to CMS in response to its RFI.

The specific value-based reimbursement exceptions would eliminate the need to create waivers for each Medicare alternative payment model. Exceptions should be built into the law to cover care coordination and value-based care arrangements.

Additionally, the AHA warned policymakers that changes to the Stark Law’s ownership ban would be detrimental to healthcare.

“We urge that no changes be made to the regulations implementing the Stark Law’s ownership ban. That ban is a carefully developed policy that is working as Congress intended,” the group wrote to CMS.

Medical device manufacturers also recently came forward to voice their discontent with the anti-kickback statute.

“Medtech companies not only create life-changing innovations that save and improve thousands of patients’ lives every day, they can also be key players in coordinated care by leveraging their clinical and economic expertise, supply chain management capability and data analytics proficiency,” stated Scott Whitaker, President and CEO of the Advanced Medical Technology Association (AdvaMed).

“Simply put, medtech companies want to be full partners in care delivery, to help drive comprehensive solutions to detect, treat, and manage disease, and share accountability for achieving better outcomes as well as managing costs,” he continued. “But the existing AKS and its narrow and outdated regulatory safe harbors deter medtech companies from participating in these value-based arrangements.”

The industry group advised OIG to create two new safe harbors that cover value-based pricing arrangements and value-based warranty arrangements.

“These proposals are intended to allow for clinical performance incentive payments and results-based contracts – between providers, between providers and manufacturers, and between manufacturers and payers – that focus on optimizing patients’ clinical outcomes and fostering efficient and cost-effective delivery of care through shared accountability,” Whitaker explained. “And, they will facilitate medtech company competition based on outcomes, all for the benefit of patients.”

Healthcare fraud and abuse laws created under the fee-for-service payment structure do not align with value-based care and reimbursement, policymakers and providers agree. With both parties on the same page, providers are likely to see HHS modify the healthcare fraud and abuse laws in the near future.