March 7, 2019

QUESTION:        The Department of Health and Human Services requires us to take reasonable steps to provide meaningful access to Limited English Proficient (“LEP”) persons.  Can we rely on a patient’s family members or friends to help with this?

ANSWER:            No.  The only exception is if it is an emergency or if the patient specifically requests otherwise.  All entities that receive federal financial assistance from the Department of Health and Human Services (“HHS”) are generally prohibited from requiring patients with limited English proficiency to use family members or friends as interpreters.  HHS acknowledges in its regulatory guidance that there may be times when a patient feels more comfortable having a trusted friend or family member act as interpreter — under these circumstances, you can honor the request.  However, you should consider factors such as competency, confidentiality, privacy, and/or conflicts of interest.

Your legal obligations will vary depending on the size of your organization and the patients you typically encounter.  This area of the law is developing quickly and we expect to see more case law on this topic in the next few years.  In the meantime, we encourage you to review your policies on this matter and have your lawyers assess whether you are in compliance with all federal regulatory obligations.

August 30, 2018

QUESTION:        What is the latest formal regulatory guidance from the government on how hospitals are to structure a gainsharing program or a compensation arrangement with physicians who assist a hospital with the hospital’s Value Based Purchasing Program (“VBP”)?

ANSWER:            Currently, there is none – this is why the responses to the June 25, 2018 CMS Request for Information on the Stark Law and the OIG’s August 27, 2018 Request for Information that is described in this week’s “Government at Work” are so important.

Both OIG and CMS have referenced the HHS “Regulatory Sprint to Coordinated Care.”  Both OIG and CMS have recognized that the Fraud and Abuse Laws that are within their jurisdiction (the Stark Law in CMS’s case and the Anti-Kickback Statute and Civil Money Penalty Law (the “CMP”) in OIG’s case) can create real or perceived barriers to achieving clinical and financial integration between hospitals and physicians.  What is unfortunate is that in the past neither CMS nor OIG has shown much of a willingness to address those barriers to hospital-physician integration efforts.

As we pointed out to CMS (and also intend to inform OIG), if removing unnecessary governmental obstacles to care coordination is a key priority for HHS, then the planned HHS “Regulatory Sprint to Coordinated Care” will not get off the starting line without significant revisions to the regulations implementing the Stark Law, the Anti-Kickback Statute and the CMP, which are well within the respective discretion of CMS and OIG to implement.

For example, hospitals need immediate guidance concerning the ability of a hospital to compensate physicians who assist the hospital under Medicare’s VBP.  It is difficult, if not impossible, for a hospital to achieve the desired goals under the VBP without physician input and cooperation.  However, the fair market value of that input and cooperation is difficult to determine and hourly payment rates are often not reflective of the fair market value of the services actually being provided to the hospital by the physicians.

Hospitals need to be assured that utilizing a payment methodology that is based, in whole or in part, on the amount of the payment that the hospital receives under the VBP due to the services provided by the physicians will satisfy an exception to the Physician Self-Referral Law and will not violate the Anti-Kickback Statute or the CMP.

In addition, since 2001, the OIG has provided Compliance Program and Advisory Opinion Guidance on gainsharing arrangements.  (See, OIG Supplemental Compliance Program Guidance for Hospitals, 70 Fed. Reg. 4858, 4869-70 (Jan. 31, 2005); e.g., OIG Advisory Opinions 01-01 (Jan. 11, 2001); 05-01 (Feb. 4, 2005); 05-02, 05-03, 05-04 (Feb. 17, 2005); 05-05, 05-06 (Feb. 25, 2005); 06-22 (Nov. 16, 2006); 07-21, 07-22 (Jan. 14, 2008); 17-09 (Jan. 5, 2018).  However, no safe harbor exists for gainsharing arrangements.

CMS issued a proposed regulation, Incentive Payment and Shared Savings Programs, on July 7, 2008 (to be codified at 42 C.F.R. § 411.357(x)).  However, that proposed regulation did not adequately address VBP and  differed significantly from OIG’s gainsharing guidance.  Rather than publish a final regulation, CMS asked for public comment on 55 aspects of the proposed regulation.  73 Fed. Reg. 69,725, 69,795-98 (Nov. 19, 2008).  Unfortunately, to date, CMS has failed to issue any type of formal (or informal) guidance on the application of the Stark Law to gainsharing or other shared savings programs.

The OIG should turn its gainsharing, compliance and advisory opinion guidance into a safe harbor.  While we would prefer a new Stark gainsharing exception, a new Stark exception may not necessary so long as CMS states unambiguously that a hospital that complies with that OIG gainsharing safe harbor will satisfy the personal services exception to the Physician Self-Referral Law.

CMS and OIG should also propose additional, consistent guidance that will address VBP and other shared savings programs.  Such a position would be consistent with the position taken by CMS and the OIG in adopting parallel Stark exceptions and anti-kickback safe harbors for providing financial assistance to physicians implementing electronic prescribing and electronic health records (See 42 C.F.R. § 411.357(v)-(w); 42 C.F.R. § 1001.952(x)-(y)) and would provide practical guidance that hospitals and physicians could use to achieve clinical and financial integration.