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Taxpayers Against Fraud Comments on Proposed Changes to Anti-Kickback and Stark Laws

January 8, 2020

The United States Department of Health and Human Services (HHS) announced proposed changes to regulations interpreting two critical laws used to fight fraud in government health care programs: the Anti-Kickback Statute (AKS) and the Physician Self-Referral Law (Stark Law). The AKS prohibits transactions intended to induce or reward referrals for items or services reimbursed by federal health care programs. The Stark Law prohibits physician from referring a Medicare or Medicaid patient for designated health services to any entity in which the physician has a financial relationship. For years, these laws have formed the basis for many successful False Claims Act cases brought by whistleblowers and the Department of Justice for illegal conduct. These cases have returned hundreds of millions of dollars to government programs such as Medicare.

HHS has stated that the proposed changes are “reforms” intended to “modernize and clarify” the laws, particularly as the health care delivery system moves to coordinated care for patients and value-based arrangements among providers. The proposed changes are quite sweeping as can be seen in redlines that the American Bar Association’s Health Law Section prepared for each – AKS redline, Stark redline. HHS’s proposal to change these important laws has led to extensive comments from across the health care and legal industries. One of the most important voices contributing to this discussion is Taxpayers Against Fraud.

Taxpayers Against Fraud Has a Unique Perspective

Taxpayers Against Fraud (TAF) is the leading public interest non-profit organization dedicated to fighting fraud against the government. TAF and its sister organization, the TAF Education Fund (TAFEF), along with its 400-plus members (including our firm), is dedicated to protecting whistleblowers and strengthening laws and programs that empower them to expose misconduct and the theft of taxpayer dollars. Since 1986, TAFEF’s members, in partnership with the Department of Justice (DOJ) and state attorneys general, have represented whistleblowers in False Claims Act matters that have generated tens of billions of dollars in civil and criminal recoveries in health care cases. Many of these cases have exposed arrangements that violated the Stark Law or the Anti-Kickback Statute, including cases involving hospitals, pharmacies, clinical diagnostic laboratories, nursing homes, and physicians. TAF is committed to ensuring that any changes or additional exceptions to these laws protect, rather than undermine, the interests of patients and honest providers, as well as taxpayers. For that reason, TAF submitted comments critical of some of the proposed changes and suggested the addition of safeguards to protect against fraud and abuse.

TAF’s Comments on the Proposed Changes to the Anti-Kickback Statute

On the AKS side, TAF’s comments to the HHS-OIG focus on the addition of safe harbors for Value-Based Arrangements and Enterprises, changes to the Personal Services and Management safe harbor (including the addition of a safe harbor for “Outcomes-Based” arrangements), the addition of a safe harbor for cybersecurity and other technology, as well as changes to the Warranties and Patient Engagement safe harbors. TAF’s AKS comments can be found here.

TAF’s Comments on the Proposed Changes to the Stark Law

While noting its appreciation for CMS’s goal of devising bright-line rules for the interpretation of the Stark Law, TAF concluded that certain of the proposed changes do not accomplish that goal while others risk undermining the statute’s purposes. TAF’s comments, which can be found here, focus on the definitions of Fair Market Value, General Market Value, Commercial Reasonableness, Value-Based Arrangements and Enterprises, Designated Health Services, and changes to the Personal Services Arrangements exception.

Thank You, TAF

We appreciate TAF’s detailed attention to these proposed changes and its vigilance in seeking to ensure that laws protecting taxpayers against fraud and abuse not be weakened.

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