Stark Law Reform Put on Hold

Doctor accepting money

It appears we will have to wait until August 2021 for any changes to Stark Law regulations.

As we first wrote about last October, the Centers for Medicare & Medicaid Services (CMS), in conjunction with the U.S. Department of Health and Human Services (HHS), announced several changes intended to reduce compliance burdens, while at the same time maintaining safeguards. Those changes were set to take place by August 2020.

However, in a notice posted in the Federal Register, CMS stated that it was “still working through the complexity of issues raised by comments received on the proposed rule” and, as a result, would not be able to meet its self-imposed deadline for another year.

The proposed rules revise safe harbor protections under the federal anti-kickback statute for certain coordinated care and associated value-based arrangements as part of HHS’ “regulatory sprint to coordinated care.

The Stark Law, which was passed in 1989, prohibits a physician from making referrals for certain designated health services payable by Medicare to an entity with which he or she (or an immediate family member) has a financial relationship (ownership, investment, or compensation), unless an exception applies.”

However, since that time, the healthcare system has moved away from a fee-for-service payment system to a value-based one in which providers are paid based on quality of patient care rather than the volume of services provided.

The proposed rule included:

  • Exceptions to the physician self-referral law for certain value-based compensation arrangements between or among physicians, providers and suppliers.
  • A new exception for certain arrangements under which a physician receives limited remuneration for items or services actually provided by the physician.
  • A new exception for donations of cybersecurity technology and related services.
  • Amendments to the existing exception for electronic health records (EHR) items and services. 

The proposed rule also would provide guidance for physicians and healthcare providers and suppliers whose financial relationships are governed by the physician self-referral statute and regulations. 

Numerous healthcare organizations have been pushing for changes saying it would allow for innovative arrangements designed to enhance coordination of care, improve quality and reduce costs.

The American Hospital Association put out a statement calling the delay an “extremely disappointing setback for hospital and health system efforts to continue to innovate coordinated care arrangements, which have great potential to benefit patients, lower costs and make care more accessible for everyone.”

The Health Law Offices of Anthony C. Vitale can assist clients in understanding what arrangements are permissible under current law and to provide them with guidance as laws are updated. For more information, give us a call at 305-358-4500, or send an email to and let’s discuss how we might be able to assist you.

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The Health Law Offices of Anthony C. Vitale