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Deadline for Physician Self-Referral Rule Changes Extended (2)

Aug. 26, 2020, 9:30 PMUpdated: Aug. 27, 2020, 2:32 PM

The Medicare agency gave itself extra time to finalize a rule that would change how an anti-fraud law is carried out. The rule is aimed at easing restraints on health-care providers and improving care.

Modifications to the rules under the Stark law, which prohibits physician self-referrals, were proposed Oct. 9, 2019, by the Centers for Medicare & Medicaid Services. They would provide new exceptions for value-based arrangements, which help doctors and other providers coordinate care among shared patients.

However, a notice in the Federal Register Wednesday said the final rule won’t come before the original Aug. 31 deadline, and it gave the agency until August 2021.

The extension is a required formality and the Department of Health and Human Services still hopes to finalize the rules as soon as possible, an HHS official said on condition of anonymity.

“This notice is simply a procedural step that we had to take because CMS is not publishing the rule by August 2020 as anticipated in the last Unified Agenda,” a CMS spokesperson said.

“CMS is not delaying the Stark rule and is working hard to finalize it,” the spokesperson said.

An HHS spokesperson declined to comment on the rulemaking process, but pointed to the statutory requirement that the CMS post the notice. The spokesperson said that the requirement doesn’t apply to the HHS Office of the Inspector General.

That explains why the OIG hasn’t posted a similar notice about an extension to finalize changes to the implementation of the anti-kickback statute, which prohibits efforts to reward business referrals in federal health programs.

Both rules have been undergoing review by the Office of Management and Budget since July 21.

The laws aim to keep caregivers’ personal financial considerations from influencing their medical decisions. But doctors say their strict provisions have become outdated and are slowing efforts to provide value-based patient care.

The Trump administration agrees. It says providers in a value-based system are unlikely to pad their Medicare bills with unnecessary services when they have a financial incentive to hold down patient costs in a value-based system.

Health insurers, hospitals, and doctors largely support updates to both laws, saying the statutes restrict efforts to coordinate patient care among different providers—a central component of value-based care.

A bipartisan group of more than 70 House lawmakers asked HHS Secretary Alex Azar and Office of Management and Budget Director Russell Vought in a letter Tuesday “to issue the final rules as soon as possible.”

The lawmakers added that “the emergence of COVID-19 across the nation has further highlighted the urgent need for improved coordination and alignment among health care stakeholders to achieve the best result for patients while restraining cost.”

About 120 health-care companies, associations, and advocacy groups sent a letter Aug. 5 asking President Donald Trump to “promptly” finalize the rule “in the name of helping patients get better coordinated care and reducing overall healthcare costs.”

—With assistance from Tony Pugh and Alex Ruoff

(Updates Aug. 26 story with an explanation of why the OIG hasn't posted a similar announcement on a related rule.)

To contact the reporter on this story: Shira Stein in Washington at sstein@bloomberglaw.com

To contact the editors responsible for this story: Fawn Johnson at fjohnson@bloomberglaw.com; Brent Bierman at bbierman@bloomberglaw.com

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