Does anyone else feel that the proposed waiver regulations don’t go far enough? Do you think they allow providers to engage in flexible arrangements that deliver value to the government? The key is how the government has limited the waiver proposals mostly only to the shared savings distributions. That seems too narrow, although I think there is confusion over exactly what payments are actually covered by a shared savings distribution . A Medical Director arrangement that is set up to get the physician controlling hospital costs would not be subject to the waiver, and would still need to be meet exception/safe harbors.
I think it becomes imperative that industry respond to this rule with well thought out comments. Indeed, my co-presenter on ACO waivers at Friday’s AHLA’s Institute on Medicare and Medicaid Payment Issues meeting in Baltimore, James Cannatti from the Office of the Inspector General at CMS, is listed as the person to contact regarding the AKS and CMP laws. And during the Friday presentation, James in fact challenged me specifically, and industry in general, to develop a well thought out waiver proposal that would provide additional flexibility for providers to work out innovative, “game changing” relationships while allowing for balance with the regulator’s need to ensure that quality care is paramount.
I told the audience Friday that I — and we as an industry — are up for that challenge. I think we are, but we need to develop that approach over the next 60-odd days (the period of time in which OIG solicits comments regarding the scope of the waiver authority).
Stakeholders need to realize that all comments made to the OIG will be considered public and thus available to all for review and analysis. This tends toward a best practice of well thought out comments, likely specific to particular issues rather than rambling comments covering the waterfront. These comments can also be viewed as a form of PR/marketing as one can expect that many stakeholders will be reading them.
Here are some of my initial thoughts on the three specific waiver proposals, relating to the Stark Law, the Anti-Kickback Statute (AKS) and the Civil Monetary Penalties Law (CMP).
WAIVER PROPOSAL #1: The Stark Law would be waived for all ACO payments THAT ARE DISTRIBUTIONS OF SHARED SAVINGS made from CMS to the ACO, and then from the ACO to each of the ACO participants. One really important question is, what is a distribution of a shared saving, and what is a different sort of payment from CMS to the ACO or from the ACO to physician/provider participants in the ACO, or even between physician/provider participants in the ACO but that doesn’t directly include the ACO itself?  It seems unduly burdensome to have a dual-track standard that protects certain payments and not others when all of the payments are made to individuals who are participating in a common, changed care pattern.
It does appear that the waiver is broad enough to cover distributions of shared savings outside the ACO program as well, perhaps this would include commercial/other payments. Still, the waiver is limited to the ACO shared saving distributions in any case. The OIG seems to be clear that they will not protect payments made to referring physicians outside the ACO unless those payments are distributions of shared savings and the payments relate to necessary activities of the ACO. An additional area that we should consider asking OIG for clarification on relates to how it will look at commercial payments versus shared savings distributions. If, for example, a physician changes a practice pattern that involves a payment for all patients, commercial and Medicare and Medicaid, ideally providers could have some comfort that the non-governmental payments would not be considered problematic.
WAIVER PROPOSAL #2: The AKS would be waived in two respects. First, there would be a waiver with similar scope to the Stark Law waiver discussed above. This makes sense to coordinate the two provisions. Second, there would be a waiver of the AKS to the extent that one fits within a Stark Law exception. So if you meet Stark, you don’t even have to run an AKS analysis with regard to any other particular financial relationship whatsoever. This seems like a good use of the waiver authority, although the “kicker” is that the Stark Law will continue to operate and that will put a brake on many creative approaches, including for example physician ownership of hospitals, under arrangements in many circumstances, and the like.
WAIVER PROPOSAL #3: The CMP laws would be waived in two circumstances. First, there would be a waiver with regard to payments from hospitals to docs that do not relate to limiting medically necessary services and the hospital and the docs were in an ACO. This seems like a great use of the waiver authority, as this will carve out many payments under the ACO from CMP risk, while maintaining a balance with regard to ensuring that medically necessary services continue to be rendered. However, note that this waiver ONLY applies to distributions of shared savings. So any underlying relationship that does not relate to the shared saving distribution would NOT be covered by this waiver proposal. To my way of thinking, this again seems unduly restrictive. Hospitals and physicians should have the flexibility in ACO design to design payment methodologies and relationships that effectuate the delivery of value, providing that medical care is not compromised.
In addition, the CMP laws would be waived with regard to any payment that is covered by Stark and meets an exception. Again, the Stark Law and the exceptions from Stark appear to be a “golden rule” that allows one to escape from AKS and CMP law analysis.