LUGPA urges Congress to update Stark law

The federal Stark physician self-referral law and federal Anti-Kickback Statute threaten to derail the federal government’s value-based care initiative unless changes are enacted so alternative payment models can be developed without participating physicians risking violating these laws.

That’s the view of LUGPA and Gary M. Kirsh, MD, past president of that organization and chair of LUGPA’s Alternative Payment Model Task Force. Dr. Kirsh testified before the House Ways and Means Subcommittee on Health in July as Congress is currently considering legislation to update Stark.

The concept of value-based care was set forth in the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015, which repealed the sustainable growth rate formula for Medicare payments to physicians, changed the way Medicare rewards clinicians for value over volume, streamlined multiple quality programs under a new Merit-based Incentive Payment System, and provided for bonus payment for participation in eligible alternative payment models (APMs).

Only 5% participate in an APM

“Unfortunately, the vision of MACRA and value-based delivery is in jeopardy,” Dr. Kirsh told lawmakers at the hearing, noting that only 5% of U.S. physicians participate in an APM and there are almost no APMs in the pipeline for approval.

Last year, LUGPA developed a urology-specific APM that would give physicians incentives to pursue active surveillance rather than active intervention in patients with localized prostate cancer. It is predicated on the belief that many patients who receive active intervention could benefit from having that deferred, thus avoiding overutilization of services while reducing morbidity and cost.

Also by Bob Gatty: AUA, AACU back Good Samaritan legislation

Like all proposed APMs, LUGPA’s proposal must be approved by the Department of Health and Human Services’ (HHS) Physician-Focused Payment Model Technical Advisory Committee, and if approved there, by HHS.

But the Stark law gets in the way, said Dr. Kirsh.

“Existing Stark and associated fraud and abuse laws are one of the principal barriers to the development of APMs and the advancement of value-based care,” he said, noting that it was written 30 years ago and has not been modified since 1993.

“Congress recognized long ago that the Stark law was an obstacle to care coordination and value-based delivery when it authorized the Secretary of Health and Human Services to waive the self-referral and anti-kickback prohibitions for accountable care organizations,” he said. “Yet independent physician practices were left behind. Congress should level the playing field to provide these same protections for independent physicians to test and participate in APMs.”

For now, unless waivers are approved on a case-by-case basis, organizations wishing to develop APMs “find themselves in a catch-22,” said Dr. Kirsh. “They cannot test an APM in the real world without financial waivers to Stark and anti-kickback laws, yet these waivers cannot be granted unless there is an approved APM.”

Dr. Kirsh noted that organizations such as LUGPA may spend years of work, resources, and substantial investments designing an APM, “but it remains a theoretical, mathematical model whose actual impact on patient care and health care financing is unknown without testing in the clinical environment.”

Next: Proposed bill could helpProposed bill could help

Essentially, that is why LUGPA and 24 other physician groups have endorsed the Medicare Care Coordination Improvement Act (H.R. 4206), “which provides a means for the [HHS Office of Inspector General] to grant waivers to test a proposed APM when it is submitted in writing and approved by the [HHS] Secretary,” Dr. Kirsh said. The waivers would have to be recertified every 6 months until the APM is approved or denied.

Dr. Kirsh explained to Health Subcommittee members that the Stark law also represents a barrier to the development and adoption of APMs because it explicitly prohibits remuneration of physicians who receive revenue from designated health services based on the “volume or value” of their referrals to these services.

“While this may be crucial in fee-for-service models, this hampers practices from incentivizing physicians to adhere to treatment pathways and agreed-upon clinical guidelines that improve patient outcomes and promote efficient use of health care resources in the context of an APM,” said Dr. Kirsh. “Current Stark law prevents practices from utilizing revenue from designated health services to financially reward or penalize physicians for adherence or deviation from clinical best practice standards or appropriate increases or decreases in utilization of services.”

Recommended:LUGPA president details decade of successes with eye on future

What is needed, said Dr. Kirsh, is elimination of “volume or value” from Stark prohibitions for the testing and operation of APMs, which would “result in a clean, targeted, modernized version of the Stark and anti-kickback statutes.”

This, he said, is needed for clinicians to be willing to enter into APMs, which by definition limit financial exposure to the Medicare program.

According to Deepak Kapoor, MD, chairman of LUGPA’s Health Policy Committee, holding clinicians harmless for APM participation is simply a matter of common sense.

“How can you have value-based care if you are not allowed to compensate physicians based on value?” Dr. Kapoor asked in an interview with Urology Times. “I think this is something that everybody acknowledges has got to get done.”

Certainly, physicians will not knowingly risk violating Stark, which could subject them to treble damages regardless of their intent, he said.

“Congress needs to enact these reforms if we are to move forward with value-based care.