Stark Law Revisions Just One of Many Factors Driving Value-based Care
May 20, 2021
Stark Law Revisions Just One of Many Factors Driving Value-based CareDownload Article
The Stark Law, also known as the Physician Self-referral Law, prohibits physicians from referring patients to entities with which the physician has a financial relationship, whereas the Anti-Kickback Statue prohibits the knowing and willful payment of renumeration to induce or reward patient referrals.
According to NixonGwilt Law, the “new Stark exceptions are accessible to value-based enterprise (VBE) participants who participate in value-based activities conducted under a value-based arrangement for a value-based purpose.” According to CMS, “whatever its size and structure, a value-based enterprise is essentially a network of participants that have agreed to collaborate with regard to a target patient population to put the patient at the center of care through care coordination, increase efficiencies in the delivery of care, and improve outcomes for patients.”
The Stark Law exceptions involve three scenarios: full financial risk, meaningful downside financial risk and no financial risk. Stark exceptions are inversely related to the degree of financial risk.
Despite more than a decade of experimentation with value-based payments, penetration rates remain low. Changes to the Stark Law and Anti-Kickback Statute do not necessarily alter the fundamental barriers to value-based market penetration. These changes do, however, allow for more flexibility in designing physician compensation plans under these arrangements, particularly for those taking full financial risk. Provider network resistance may lessen, while care coordination increases. We project an incremental positive impact of the change.