CMS looks to formalize six-year lookback period for Medicare self-referral disclosures

Patient self-referralThe Centers for Medicare and Medicaid recently published a notice proposing revisions to its self-referral disclosure protocol (SRDP). The SRDP allows healthcare providers and suppliers to self-disclose actual or potential violations of the physician self-referral statute, or Stark Law.

Under the proposal, healthcare providers who use the SRDP will have to provide the agency with a financial analysis of overpayments based on a six-year lookback period. The lookback period applies only to submissions to the SRDP received on or after March 14, 2016, the effective date of the final overpayment rule. Parties submitting self-disclosures to the SRDP prior to March 14, 2016 need only provide a financial analysis of potential overpayments based on a four-year lookback period, according to the notice.

Until CMS finalized the overpayment refund regulation in February – which detailed the reporting and returning of Medicare Part A and B overpayments – the SRDP required providers to refund only four years of Medicare reimbursement tainted by “actual or potential” violations of the Stark self-referral law.

However, as we wrote about in February, that changed with the Medicare rule, which gives providers 60 days to report and return overpayments once they have been identified and quantified. The six-year lookback period brings the SRDP in line with the timeframe established by CMS’ final rule.

CMS plans to require the use of new forms for all SRDP submissions, which it says are intended to streamline and simplify the submission process. They are:

  • The SRDP Disclosure Form, which provides information about the disclosing party, including information regarding the disclosing party’s history of abuse, pervasiveness of noncompliance, and steps to prevent future noncompliance.
  • For each physician included in the disclosure, the disclosing party must submit a separate Physician Information Form providing details of the noncompliant financial relationship(s) between the physician and the disclosing party.
  • The Financial Analysis Worksheet, which quantifies the overpayment for each physician included in the disclosure who made referrals in violation of section 1877 of the Act.
  • In its initial submission, and in any related supplemental submission, the disclosing party, or in the case of an entity its Chief Executive Officer, Chief Financial Officer, or other authorized representative, must submit to CMS a signed certification stating that, to the best of the individual’s knowledge, the information provided contains truthful information and is based on a good faith effort to bring the matter to CMS’ attention for the purpose of resolving the disclosed potential liabilities relating to the physician self-referral law.

CMS includes a number of examples to help guide providers in responding to its pervasiveness inquiry. They include:

  • The hospital has numerous compensation arrangements with physicians. We estimate that the noncompliant compensation arrangements disclosed herein represent less than 3 percent of all financial relationships with physicians.
  • Six of the hospital’s 30 call coverage arrangements (20 percent) failed to satisfy the requirements of the exception for personal service arrangements at § 411.357(d) or fair market value compensation at§ 411.357(l). The hospital had no other financial relationships with referring physicians.
  • The hospital has 25 physician owners. Each physician owner had an ownership or investment interest during the entire lookback period. One of the physician owners was not authorized to perform services at the hospital as required at § 411.356(c)(3)(i) for a period of six months during the lookback period.
  • In 150 instances during a six-month period, the group practice failed to provide the notice required at § 411.355(b)(7). We reviewed the medical records and determined that this represents approximately 10 percent of the services subject to the notice requirement that were furnished by the group practice during the same six-month period.
  • The physician practice provided nonmonetary compensation to 50 referring physicians who were not part of the physician practice during calendar year 2015. The physician practice exceeded the annual limit on nonmonetary compensation with respect to two physicians. Neither physician returned the excess nonmonetary compensation during the period established at § 411.357(k)(3).

If a disclosing party fails to work in good faith with CMS to resolve the disclosed matter, the lack of cooperation will be taken into account in CMS’ resolution of the matter, the agency states.

CMS will take a number of factors into consideration when deciding what is owed. They include:

  • The nature and extent of the improper or illegal practice
  • The timeliness of the self-disclosure
  • The cooperation in providing additional information related to the disclosure

Although CMS may consider these factors in determining whether reduction in any amounts owed is appropriate, CMS does not have to reduce any amounts owed.

As with any proposed rule change CMS is seeking public comments, which are due no later than July 5, 2016.

The Health Law Offices of Anthony C. Vitale has extensive experience representing clients in audits and overpayments and we can represent your interests through all of the stages of the overpayment appeals process in an effort to achieve the most successful results. If you have any questions or concerns, contact us at 305 358-4500 or email us at

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