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Health Law and Compliance

Regulatory Changes to Stark Law
By David H Levien
Posted: 2020-11-27T16:23:00Z
Regulatory Changes to Stark Law
By Richard Kusserow | November 25, 2020
The Centers for Medicare and Medicaid Services (CMS) announced regulatory changes to the
Physician Self-Referral Law
(“Stark Law”), which prohibits a physician from referring a patient for
many types of services (or “designated health services”) to a provider with which the physician
has a financial relationship. CMS stated that the old rules were designed for a health care system
that reimburses providers on a fee-for-service basis, which provides financial incentives to deliver
more services. It recognized the increasing movement toward financial arrangements that
reward providers who are successful at keeping patients healthy and out of the hospital and
thereby tie payment to value rather than volume. The prior system has resulted in health care
providers spending millions of dollars to comply with obscure regulations instead of putting those
funds 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. With providers taking on the
accountability for the total cost of care for their patients, the risks related to self-referral have
changed and needed to be recognized in the regulations.

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