HHS “Sprints” Toward New AKS Safe Harbors and Penalty Exceptions

September 26, 2018

The U.S. Department of Health and Human Services (HHS) has launched its “Regulatory Sprint to Coordinated Care” to accelerate the healthcare system’s transformation to a value-based system rewarding coordinated care. This “regulatory sprint” focuses on identifying regulatory provisions that may act as unnecessary obstacles to coordinated care and issuing guidance to address such obstacles.

Specifically, the HHS Office of the Inspector General (OIG) requested industry input on Aug. 27 to “identify ways in which it might modify or add new safe harbors to the Anti-Kickback Statute [(AKS)] and exceptions to the beneficiary inducements Civil Monetary Penalty (CMP) definition of ‘remuneration’ in order to foster arrangements that would promote care coordination and advance the delivery of value-based care, while also protecting against harm caused by fraud and abuse.” To this end, HHS may issue guidance and revise regulations to address such obstacles and to encourage and incentivize coordinated care in response to this request for information.

This is not the first HHS request for information under this “regulatory sprint.” On June 25, 2018, the Centers for Medicare & Medicaid Services (CMS) published a request for information seeking industry input regarding the physician self-referral law, commonly known as the Stark Law. The strict liability Stark Law prohibits a physician from referring certain Medicare- and Medicaid-designated health services to an entity where that physician or his or her family has a financial relationship, absent an exception. This relationship could include certain value-based or care coordination arrangements. CMS sought comments to revise or add exceptions or redefine terminology of the Stark Law to structure arrangements between parties that participate in alternative payment models or other novel financial arrangements. In this June request, CMS presented 20 topics for comment.

The latest OIG request for information seeks input from the public on ways it might modify or add new safe harbors to the AKS and exceptions to the beneficiary inducements CMP definition of remuneration. The AKS is a broad criminal prohibition against the offer or exchange of anything of value to induce or reward the referral of federal healthcare program business. Similarly, the CMP law acts as a catch-all as it authorizes the OIG to impose civil monetary penalties (and other remedies) for various types of fraud and abuse under the Medicare and Medicaid programs, including beneficiary inducement. As both laws have broad language, OIG has issued safe harbors and exceptions to protect certain relationships that do not pose a high risk of fraud or abuse. In this request for information, the OIG again considers this balance between risks to federal programs with acceptable provider relationships. In particular, OIG seeks input on the following topics:

  1. Promoting Care Coordination and Value-Based Care

OIG requests information about potential arrangements the industry is interested in pursuing, such as care coordination, value-based arrangements, alternative payment models, arrangements involving innovative technology, and other novel financial arrangements that may implicate the AKS or beneficiary inducements CMP. OIG wants to gain a better understanding of the structure and terms of such agreements and requested that stakeholders identify additional AKS safe harbors or exceptions to the definition of “remuneration” under the beneficiary inducements CMP that may be necessary to protect such arrangements.

  1. Beneficiary Engagement (Beneficiary Inducements and Cost-Sharing Obligations)

OIG requests industry input regarding the types of incentives providers, suppliers and others are interested in providing to engage beneficiaries to improve their care. OIG wants to understand how providing such incentives would contribute to or improve quality of care, care coordination and patient engagement, and whether the types of entities that furnish the incentives matter from an effectiveness and program integrity perspective.

In addition, OIG seeks input about how reducing beneficiary cost-sharing obligations might improve care delivery, enhance value-based arrangements and promote quality of care.

  1. Current Fraud and Abuse Waivers

OIG solicits feedback on the current waivers developed for the purposes of testing models by the Center for Medicare and Medicaid Innovation and carrying out the Medicare Shared Savings Program. These waivers have been specific to these limited programs to date and would not apply to other relationships the providers have for other third-party payor programs. OIG hopes to gain insight about what waiver structures work well and whether any waiver requirements are particularly burdensome.

  1. Cybersecurity-Related Items and Services

OIG is aware of the industry’s interest in donating or subsidizing cybersecurity-related items and services to providers and others with whom they share information. It seeks information about the types of cybersecurity-related items or services entities wish to donate or subsidize, and how existing fraud and abuse laws may pose barriers to such arrangements. Under current law, CMS and OIG allow certain health information and electronic health record donations and support, but this would go beyond to an ongoing related service.

  1. Accountable Care Organization (ACO) Beneficiary Incentive Program

Section 50341(b) of the Bipartisan Budget Act of 2018 states that “illegal remuneration” under the AKS does not include “an incentive payment made to a Medicare fee-for-service beneficiary by an ACO under an ACO Beneficiary Incentive Program” but allowed OIG to add other conditions on such payment.  For the purposes of implementing this new statutory exception, OIG requests input regarding what, if any, “other conditions” a regulatory safe harbor should include as additional program protections or safeguards.

  1. Telehealth

Section 50302(c) of the Bipartisan Budget Act of 2018 creates a new exception to the definition of “remuneration” in the beneficiary inducements CMP. This exception applies to “telehealth technologies” provided on or after Jan. 1, 2019, to an individual with end-stage renal disease (ESRD) who is receiving home dialysis for which payment is being made under Medicare Part B. The exception stipulates that (i) the telehealth technologies not be offered as part of any advertisement or solicitation; (ii) the telehealth technologies be provided for the purpose of furnishing telehealth services related to the patient’s ESRD; and (iii) that the technologies meet any other requirements mandated by OIG.

For the purposes of this exception, OIG requests input on how “telehealth technologies” should be defined as well as examples of telehealth technologies that may be used to furnish telehealth services related to a beneficiary’s ESRD.

  1. The Intersection of the AKS and the Stark Law

Lastly, OIG requests feedback regarding specific circumstances in which (i) exceptions to the Stark Law and safe harbors to the AKS should align for purposes of accelerating the transformation to a value-based system; and (ii) where exceptions to the Stark Law should not have a corresponding AKS safe harbor. As mentioned above, the Stark Law is a strict liability statute while the AKS is a criminal statute requiring intent. Thus, OIG and CMS historically have considered each other’s respective guidance but have not adopted it by default in their respective rulemaking. That said, OIG clarifies here that they want to reconsider certain areas of overlap in the care coordination space and asks that commentators re-comment with respect to this request if they provided CMS comments earlier this year.

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HHS recognizes that reimbursement is shifting away from fee-for-service to value-based and care coordination models. Through this OIG request for information and the previous CMS request, HHS appears to also recognize that the current fraud and abuse rules may need updating for this shift.

The public can comment until 5 p.m. (ET) on Oct. 26, 2018. We would welcome the opportunity to work with you on submitting ideas to OIG. If you wish to submit comments, please contact a McGuireWoods attorney.

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