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Changes to physician self-referral system on the horizon

The Department of Health and Human Services (HHS) has stated that changes to the physician self-referral system are likely in the near future. The Trump administration is considering changes to the Stark law with a goal of encouraging coordinated care. An official with the Trump administration expects changes by the end of the year.

Why is change difficult? The Stark law makes such efforts difficult. It is a law that essentially prevents medical professionals from referring patients to any facility if they may have a financial interest. This is often true even if that facility offers the best care option for the patient.

Penalties for a violation are fierce. Each violation can result in a $15,000 fine plus three-fold any payments made by Medicare.

Why is change needed? Critics of the Stark law have pointed to a number of problems that impede the delivery of quality medical care to patients. One specific concern involves strict liability. The Stark law is written as strict liability offense. This means an offender can be held liable even if he or she had no knowledge of the connection at the time of the recommendation.

Is change likely? It appears change to this system is very likely. In addition to the outpouring of support for change after the Trump administration called for comments on the issue, Congress has also taken two different proposals on reform into consideration. Bloomberg also reports reform efforts have come up at four different congressional roundtable discussions.

How will change impact medical professionals? Doctors will have increased freedom to refer patients. Just how much freedom is unknown. As such, it is wise to review any changes carefully before changing referral procedure. A failure to do so within the bounds of the law could result in an investigation and threaten your license.

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