Chester County Medicine Winter 2021 - 30

www.CHESTERCMS.org

CMS Announces
Historic Changes to Physician
Self-Referral Regulations

I

n late November of 2020, the Centers for Medicare & Medicaid
Services (CMS) finalized changes to outdated federal regulations
that have burdened health care providers with added administrative costs and impeded the health care system's move toward
value-based reimbursement. The Physician Self-Referral Law, also
known as the " Stark Law, " generally prohibits a physician from
making referrals to an entity
for certain healthcare services,
if the physician has a financial
relationship with the entity.
The old federal regulations
that interpret and implement
this law were designed for
a health care system that
reimburses providers on a
fee-for-service basis, where
the financial incentives are to
deliver more services. However,
the 21st century American
health care system is increasingly moving toward financial
arrangements that reward providers who are successful at keeping
patients healthy and out of the hospital, where payment is tied to
value rather than volume.
Concerns regarding the Stark rule's bureaucratic barriers to value
were one of the top concerns raised by providers when CMS held
listening sessions in 2017 as part of its " Patients over Paperwork "
initiative. The millions of dollars and hundreds of hours of time
spent complying with the administrative burden of the rule were
cited as a significant burden which impeded patient care. With

30 CHESTER COUNT Y Medicine | WINTER 2021

providers taking on the accountability for the total cost of care for
their patients, the risks regarding self-referral have changed.
However, ambiguities in the Stark law have frozen many providers in place, fearful that even beneficial arrangements might violate
the law, which can come with dire and costly consequences. This has
resulted in healthcare providers spending millions of dollars complying with arcane regulations
instead of putting those
dollars toward patient
care. It has also impeded
the move toward value,
not just in Medicare, but
across all payers, including Medicaid and private
health plans.
" When we kicked
off our Patients Over
Paperwork initiative in
2017, we heard repeatedly
from front-line providers
that our outdated Stark
regulations saddled them with costly administrative burden and hindered value-based payment arrangements, " said CMS Administrator
Seema Verma. " That sound you hear is the mingled cheers and exclamations of relief from doctors and other health care professionals
across the county as we lift the weight of our punishing bureaucracy
from their backs. "
With this final rule, CMS is ensuring the regulations interpreting the Stark Law allow for changes that will help modernize the
healthcare system. The rule finalizes many of the proposed policies



Chester County Medicine Winter 2021

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