Congress blasts HCFA, OIG over Stark delay
Congress blasts HCFA, OIG over Stark delay
House Ways and Means health subcommittee promises self-referral laws will be revised
If you’ve been struggling to comply with — or even to understand — the Health Care Financing Administration’s proposed Stark self-referral regulations, good news may be on the way: At a May 13 hearing on Stark, Republican members of the House Ways and Means subcommittee on health vowed to sharply pare back the controversial Stark laws or get rid of them altogether.
"The only question now," said one aide to the subcommittee, "is whether it will be modified, reduced or eliminated." Another aide to the subcommittee’s minority staff was even less sanguine, saying with a shrug, "I don’t see how it can survive in its current form."
Prior to his testimony before the subcommittee, health care attorney Sandy Teplitsky, a partner at Ober, Kaler in Baltimore, said that even his clients who support the self-referral laws don’t understand them. He added that these laws are critical to hospitals as well as physicians "because without physicians, you have no patients."
In 1989 and then in 1993, Congress passed what became known as "Stark I" and "Stark II" after the law’s main sponsor, Rep. Pete Stark (D-CA). The laws sought to block physicians from inappropriately referring patients to facilities where they had a financial gain. In 1993, the law was extended to include hospitals, home health, and numerous other providers. But in the years since, HCFA has failed to issue a final rule and subcommittee chairman Bill Thomas and his colleagues say that fact alone proves the law itself is far too complex.
"We are well aware it has been too long," conceded HCFA deputy director Kathleen Buto, who promised that the agency would publish regulations for the six-year-old legislation sometime next year. But that did not temper the assault by Republicans. "I am appalled that we could pass a law and not tell people what it means for six years," exclaimed Rep. Nancy Johnson (R-CT).
Thomas also blasted HCFA and the Office of the Inspector General for hanging onto a regulation that has proven misguided and inoperable. "Our goal is the same," he asserted, "but your role is the defense of the indefensible — if [that’s not true], give us the regulations."
Johnson concurred. "Not all self-referral is bad," she said. "You are asking a small visiting nurses association that wants to merge with another VNA how to do it, and it has taken you six years to figure out how to do that." She added, "It is discouraging to hear you are so tied up with doing something that is so misguided."
"These laws were meant to produce a bright line, but we are farther from that than in any other area of health care," Thomas said. "Doctors and hospitals are overwhelmed with overlapping state and federal laws and red tape, including the perplexing self-referral law, that drive up the cost of health care at the very time we’re trying to make it more affordable."
The fundamental problem with the law, say its critics, is that it is so enormously complex and that HCFA continually tries to clarify it by creating exceptions. "At what point do all these exceptions swallow the idea?" Thomas asked Buto. Instead, he said, the law itself may simply be irretrievable. "Is it possible that the bright line we are looking for is compensation and not ownership?" he asserted.
Moreover, Thomas and other subcommittee members argued that the law flies in the face of the federal government’s attempts to encourage a health care system with a more coordinated, integrated approach between physicians, hospitals, and others.
The ranking Democrat on the subcommittee who wrote the original legislation, Rep. Pete Stark (D-CA), attempted to defend the law that unofficially bears his name by saying the law itself has prevented billions of dollars in fraudulent arrangements. But he conceded that it might be appropriate to revisit certain aspects of the law.
One attorney present at the hearing pointed out that even Stark’s own testimony included four suggestions for additional exceptions to the law. Equally ominous was the row of empty seats on Stark’s side of the aisle as Republicans took turns blasting the regulation.
At the moment, it is not clear what vehicle Republicans will use to change the current "self-referral" laws that are still on the books. If Congress develops Medicare legislation this year, changes in Stark I and Stark II might be rolled into that bill. In the meantime, health care providers have few options other than doing their best to comply with a confusing assortment of rules.
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