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  • A Stark Reality: APTA Continues Efforts to Shore Up Self-Referral Law

    As the US Centers for Medicare and Medicaid Services (CMS), lawmakers, and others continue to press for more value-based approaches to care, attention has turned to a law that bars physicians from referring Medicare patients to services in which the physician has a financial interest, aka "self-referral." CMS has hinted that the prohibition, known as the Stark law, may interfere with the adoption of new, more integrated models of care, and a US House of Representatives subcommittee held a hearing on "modernizing" the law, perhaps through loosening up restrictions. APTA argues that at least part of the reform efforts should be aimed at eliminating exceptions as a way to increase value-based care opportunities.

    Recently, APTA staff were on Capitol Hill to encourage legislators and their staff to take a careful approach to decisions about the Stark law, which was the subject of a July 17 House Ways and Means Health Subcommittee hearing. During that hearing, legislators were weighing the law's effect on the ability to create alternative payment models (APMs)—systems that often seek to streamline and coordinate entire episodes of care. The hearing echoed a recent CMS request for information from the public on the Stark law, and discussed whether there is a need for "revisions or additions to exceptions to the physician self-referral law, and terminology related to alternative payment models and the physician self-referral law."

    In comments provided to the House subcommittee, the association argues that a reformed Stark law with fewer loopholes could actually promote the growth of value-based care by leveling the playing field for physical therapists (PTs).

    As APTA explains in its comments, the current version of the Stark law includes an exception that allows physicians to self-refer for so-called "in-office ancillary services" (IOAS) that include physical therapy. That exception winds up hurting the development of APMs because it "fail[s] to promote collaboration with small- and medium-sized physical therapy and nonphysician practices," APTA writes.

    "Until [the US Department of Health and Human Services] creates a more level playing field between these different types of providers, physical therapists will be unable to meaningfully participate in Medicare and Medicaid APMs, despite their desire to do so, potentially impeding patient freedom of choice and access to the highest-quality care," the comment letter states.

    The association isn't alone in its commitment to eliminating Stark law loopholes. In 2017, APTA joined with the Alliance for Integrity in Medicare to support a bill in the House of Representatives that seeks to eliminate the IOAS exemptions. That bill, also supported by AARP, has not been scheduled for House committee review

    "We see the recent subcommittee meeting as a chance to highlight the need for more opportunities for physical therapist to participate in alternative payment models, all while protecting patient choice, increasing transparency, and strengthening access," said Justin Elliott, APTA's vice president of government affairs. "Effective value-based care is important. Eliminating conflicts of interest in health care is important. There's no reason why the two can't coexist."

    APTA will share that sentiment with CMS when it delivers the association's response to the CMS request for information (RFI) on the Stark law. The CMS call for feedback is largely focused on how the Stark law could be weakened through the creation of more exceptions or other tweaks, all in the name of promoting more coordinated care models. APTA is coordinating with the APTA Private Practice Section to draft comments by the August 24 deadline.

    The association also has developed a template letter that allows individuals to create a customized-but-consistent response to the CMS request (scroll down the webpage to the second bullet point under "APTA's Current Regulatory Advocacy Efforts).

    APTA is a strong supporter of easing unnecessary regulatory burdens on providers, but CMS and Congress must proceed with caution," said Kara Gainer, APTA's director of regulatory affairs. "We are urging CMS to think very carefully about the unintended consequences of making any changes that increase self-referral. A weaker Stark law could actually impede the transition to value-based care and worsen the patient experience in the process."