In this episode of our monthly series on fraud and abuse issues, Matthew Wetzel, Associate General Counsel, Compliance Officer, GRAIL, Joe Wolfe, Partner, Hall Render Killian Heath & Lyman PC, and Kristin Carter, Partner, Baker Donelson Bearman Caldwell & Berkowitz PC, discuss the eagerly anticipated final rules reforming the Stark Law and Anti-Kickback Statute. The podcast dives into when the rules might be released and what they might look like. From AHLA's Fraud and Abuse Practice Group. Sponsored by BRG.
To learn more about AHLA and the educational resources available to the health law community, visit americanhealthlaw.org.
In this episode of our monthly series on fraud and abuse issues, Matthew Wetzel, Associate General Counsel, Compliance Officer, GRAIL, Joe Wolfe, Partner, Hall Render Killian Heath & Lyman PC, and Kristin Carter, Partner, Baker Donelson Bearman Caldwell & Berkowitz PC, discuss the eagerly anticipated final rules reforming the Stark Law and Anti-Kickback Statute. The podcast dives into when the rules might be released and what they might look like. From AHLA's Fraud and Abuse Practice Group. Sponsored by BRG.
To learn more about AHLA and the educational resources available to the health law community, visit americanhealthlaw.org.
The following message and support for A H L A is provided by Berkeley Research Group, a global consulting firm that helps organizations advance in the areas of disputes and investigations, corporate finance and strategy and operations. BRG helps clients stay ahead of what's next. For more information, visit think brg.com.
Speaker 2:Welcome to the American Health Law Associations Fraud and Abuse Practice Group podcast. My name is Matt Wetzel. I'm the chair of the A H L A Fraud Abuse Practice Group, and with me today are Joe Wolf and Kristen Carter, our Vice Chairs of educational programming. Joe is a partner in Hall Renders Milwaukee office, and Kristen is a partner in Baker Donaldson's, uh, Baltimore office. And today we're gonna talk about the, uh, rules for, uh, coordinated care that we're expecting to see from h h s, uh, at any moment. Now, uh, as many of you recall last year, uh, at the end of 2019, c m s and OIG and a coordinated fashion issued their proposed rules, uh, for value-based arrangements and coordinated care. Uh, this, of course, created a significant, uh, stir and impact in the industry. And now as we're approaching, uh, almost a year later, uh, 10 months later, at this point since the release, uh, some of us are wondering where are those rules? And so we wanted to spend a little time today, uh, amongst the three of us talking about, uh, the potential final rules, where they are and what we can, uh, expect to see in those final rules. So, Joe, you know, I might just turn it over to you first and ask, uh, from a purely administrative perspective, where are the final rules and what can we expect in terms of timing for their release?
Speaker 3:Yeah, thanks Matt. Um, uh, right now the rules are with the office of, of Management and Budget, um, for final review. That's the last stop before they would move on to be published. So HHS has already sent them over, I think that occurred back on July 21st. Um, and so they're, they're right now sitting with om b uh, the next step would be to, to move those forward and, and to publish them so that that's where they're sitting right now. And, and, uh, everyone's anxiously awaiting for them.
Speaker 2:That's great. And, and, and, and, and what, what can we expect, Joe, um, from a timing perspective? Uh, and, and by that I mean, uh, you know, is there a sense of urgency in the industry? Is there a need to have these rules out sooner rather than later? What are your thoughts there?
Speaker 3:Well, as you mentioned earlier, the rules came out last October in proposed form. I think the industry was largely supportive of them. Uh, the, the comment period ended at the end of last year in 2019. So, um, you know, at that point, I think the, the, the thinking was that they would move forward this year, obviously, um, in some ways that has been derailed by Covid. Um, I think when we look at the, the, maybe the larger categories in these two rules, there was the idea of some cleanups of some of the terminology and, and requirements. Um, and I, and I think that those, um, were well received. Uh, there was a second major part of those rules was the new value-based framework and, um, what that was going to look like. And, um, in, in my experience in working with the industry, um, that was, there was support there as well. I think it was a bit more of a wait and see and a desire to see some examples from the government on how that framework would work. So, um, in many ways, the proposed rules weren't that controversial. Um, and I think, uh, they, they were viewed by the industry as a, a step forward. And I think we fast forward to now, um, you know, in, as I said before, in some ways, COVID 19, I think, slowed this process down. Um, I, I, you know, in some ways, perhaps the, the industry may view these rules as, as maybe even more necessary because of, of covid, as we've seen, um, the flexibility around some of the waivers and how they've played in. Um, and, and, and maybe now we would use some of these other flexibilities, the, the, the revised and, and new rules might provide as, as more welcome. But I think there's a push to get this done. Um, like I said, it's been with O one B since July 21st. I think just a couple of weeks ago, uh, there was a letter to the president from over 123 healthcare organizations, um, that they sent an open letter to the president and, and to try to advance the ball on this rule with om B. So I think there is a push to get this done, uh, for many of the reasons I mentioned already. Um, and, and, and I, I think many stakeholders in the industry wanna see this get, uh, pushed forward now, so the benefits of reform aren't lost. Um, that's
Speaker 2:Great. That's great. And, and Joe, you mentioned, um, a letter to the president, Kristin. You know, we've got a, uh, a big election coming up at the end of this year, not only a presidential election, which obviously I think is a front of mind for many people, uh, but also, uh, potential change, uh, and shift, uh, in representation in Congress as well. Uh, what, what, what, what role does, uh, the election play in these final roles, uh, and, and, and how can congress, uh, uh, step in and impact the final rules as well? Any thoughts there?
Speaker 4:Sure. Um, thanks, Matt. You know, I, I think the, the impending election certainly provides additional motivation to finalize these rules as soon as possible for, for a few reasons. Um, you know, one of'em, as, as Joe mentioned, there's a lot of people in the industry who are anxiously awaiting these rules. And the flexibility, um, that might be provided by these rules that I think, you know, the need for it has been even further exposed by covid 19. Um, so getting these rules out, you know, could be seen as a political win on providing, you know, some additional flexibility in the industry to, you know, address value-based care and care coordination. Um, in addition, there's some administrative and congressional sort of oversight pieces that are at play. Um, if some of you may recall at the, the turn of the last election where we had a, um, new administration and both houses were, um, dominated by the Republicans, they actually used the Congressional Review Act, which is a statute that, um, provides congress with authority to pass joint resolutions, disapproving of agency rules, um, that were issued within the past 60 legislative days. So it's a really powerful tool that we saw used by the, the Trump administration and Congress at the changeover of the administration last time. Um, that if there's a similar changeover and, you know, there's, there's a Democrat in power in the, the house in both houses of Congress change, that tool might be used to the extent, um, these rules are delayed significantly. I I don't know how much this is a hot button topic that they might use it, but it is something at play to consider. Um, also often when we see a change in administration, um, the, the, the administration will issue a memorandum to pause some of the regulations that are still in process. So regulations that aren't finalized by the time period and, and effective as of the time period and changed over of administration might otherwise be put on pause, um, using administrative action. So I think there's some, uh, definitely some motivation from an administrative standpoint to get these finalized and effective prior to the change in administration if there were a change in administration.
Speaker 2:Really great insight, Kristen. And, uh, interesting observations on sort of the political ramifications of these rules and, you know, kind of digging into some of the substance here and, you know, at the risk of, uh, asking two lawyers to, uh, to make predictions. Yeah. I'd love to hear your, your, your thoughts and prognostications about where HHS might actually go on some of these, uh, uh, uh, uh, principles and, uh, regulatory, uh, uh, changes that we should see later this year, year. I mean, I'm even thinking myself about how will OIG and cms, uh, implement these new rules in light of their goals, uh, for the new rules and whether the, whether these new rules will actually hit those goals. Modernizing the safe harbors and the regulatory exceptions, uh, ensuring that care is better coordinated, ensuring that, um, risk is, uh, is, is allotted amongst parties to value-based arrangements in a way that, uh, that, that makes sense. Let me ask, what are your thoughts? What are your sort of top takeaways or top expectations, top predictions for the rules? Kristin, I might start with you.
Speaker 4:Yeah, I think I'm, I'm anxiously awaiting to see what these value-based rules look like, because I do think the pandemic and even, you know, leading up to the pandemic has shown the need for coordination of care. And I think a lot of people in the industry view, uh, the Stark Law in particular as being a, uh, a large hurdle to arrangements between, uh, designated health service entities, you know, labs, hospitals, and health systems and physicians. So, um, but as Joe, Joe mentioned, a lot of people were in the wait and see mode on those value-based rules. So, you know, while we, you know, they dug in on the proposals, it'll be interesting to see how far or different those value-based proposals are from, or what's final from what was proposed and what activities will be protected. And, you know, the levels of financial risk associated with each of those, uh, exceptions. I think it'll be very helpful if those are, are enacted in order to provide more latitude to those types of arrangements.
Speaker 2:Ab absolutely. Joe would love your thoughts. Predictions, prognostications?
Speaker 3:Yeah, I, I would say that I'm, I'm hoping to see that many of the cleanups that were proposed are implemented very similar to the way they looked in the, in the proposed rule. Um, I, I would, you know, I, I would anticipate the, the fact that the rules are, are progressing in a very busy environment right now that I, I'm, I'm anticipating that the rules may look very much like the proposed rules. Um, I think that, um, uh, like I said before, many of the cleanups were just widely accepted. And, um, changes to the definition, the new c commercial reasonableness definition, the tweaks of fair market value, the 90 day signature rule, those I don't think will be viewed as particularly controversial on the, on the value-based framework side, I, I do hope that we'll see more consistency between the anti-kickback statute and the stark, um, regs, uh, when they, when they come out, uh, that the, the value-based frameworks are, are synced up a bit better than they looked in that a proposed rule, you know, things around, uh, the, so that we can have a situation where a structure, a value-based structure fits both rules without having to have, you know, a, a dual sort of structure to, to meet both, both of the laws. So I'm hoping that that's what we see, uh, when this rule is ultimately finalized. And the government hopefully will pinned down, uh, you know, things like, you know, who's going to be inclusive, you know, who, what value-based VB participants are gonna be allowed in, and, and is that gonna be the same under both rules? That's what I'm hoping to see.
Speaker 2:Good observations. Thank you. And you know, Joe, we had a conversation recently about the impact of covid 19 on, uh, on, uh, healthcare fraud abuse more generally, but I wonder if you have any thoughts on how this current situation, um, is impacting potentially what these final rules might say?
Speaker 3:Yeah, I'm, I'm, um, I know Kristen touched on this briefly. I think this does highlight the complexity of the rules and, and how, um, having, um, rigid, uh, rules can, can make, make, uh, the delivery of healthcare challenging. So I'm hoping the additional flexibility we see under this rule, um, I I hope some of those changes in cleanups and, and, um, areas where more flexibility was provided were really highlighted by the, the, the recent COVID-19 pandemic. Um, tho those are my thoughts on that.
Speaker 2:No, I think that's great. And, and you know, from my own perspective, uh, you know, one of the questions I have for, uh, H H S is whether, uh, COVID 19 is, will impact substantively the rules. Obviously, you know, we've kind of talked a little bit about, about that. We've talked how, uh, COVID 19 has impacted the administrative release of the rules, but substantively, uh, you know, what we've seen over the past few months is one giant value-based arrangement or coordinated care, uh, uh, activity, uh, in play, uh, with the response to Covid 19. I note that, uh, in the proposed rule, as, as Joe you somewhat alluded to, uh, pharmaceutical manufacturers, d m e suppliers, labs, uh, in, in many cases, medical technology companies are prohibited or prevented from, uh, the protections of the various safe harbors, new safe harbors and regulations. But these are also the entities that, in the midst of the covid crisis have been developing vaccines, engaging with payers, uh, uh, making sure that we've got a full supply of P P e ventilators, other medical technology developing cures, uh, and treatments. So I think, uh, the level of coordination among those parties has been fairly significant. And my question is whether, uh, OIG and C M s have actually taken that into account and taken a look at that substantively, uh, in their final rules when they come out. Any reactions to that concept?
Speaker 3:Yeah, I think that that's a, a good point, Matt. I mean, there, a lot of parties have come to the table, um, in response to Covid 19, um, it really has been, uh, a, a, a multi, uh, stakeholder effort, uh, with the proposed rules. And your, to your point that what who was allowed to be a V B E participant was going to be very important. Um, and as, as I I saw in the comments back, and as I worked with, we worked with clients, we did see, um, a desire to have more parties at the table so we could come up with cr more creative models, um, in this value-based framework. Um, because, especially because of data, um, different types of entities, um, in these, in these categories that were, um, uh, were, the government wasn't sure if they were gonna allow them in. Obviously they have access to data, and data will be king as we, we think about value-based arrangements. So I think that Covid has highlighted, uh, the importance of having information and the importance of having, um, uh, different stakeholders at the table to solve very difficult problems.
Speaker 2:Joe, really appreciate that. And, um, uh, you know, Kristen, we've talked a little bit about some of the substantive rules here, uh, and potential changes to the rules. What's your guidance to other practitioners who are kind of GE gearing up and getting ready for, uh, the release of these final rules?
Speaker 4:Sure. I mean, I think it is time to, to sort of dust off looking at the proposals just to have a good handle of what might be coming down the pike and being prepared to, you know, address those issues as they get released. I mean, I know we're certainly taking it into account when evaluating arrangements right now, if these rules are finalized, how, what the, how that might change those arrangements we're currently looking at, and what flexibilities might we, might we be able to take advantage of, you know, to, to propel some of these arrangements that their, you know, parties are considering. So I certainly think that should be taken into account. Um, you know, it'll be interesting to see what comes out on the Stark side in terms of some of the flexibilities, you know, around lease arrangements there, you know, the, the consideration of an exception for limited remuneration. Um, some, some new exceptions, you know, that we, we hadn't seen previously. That'll hopefully, if an act, it'll provide additional flexibility. So, um, keeping those in mind as you're looking at arrangements this year.
Speaker 2:Absolutely, absolutely. Joe, any advice to practitioners looking to get ready?
Speaker 3:No, just as Kristen said, I, I would look at these rules, understand how they fit into your contracting and compliance protocols. Um, in, in some ways it's gonna make, um, compliance, um, assessments easier. Um, on the value-based side, uh, I would start looking at the value-based framework, understanding, you know, where your organization might fit into, uh, this vb, this value-based enterprise type framework. Maybe you already have some of the features that could align with these new rules. Uh, I would start looking at this terminology because it will be helpful, and you're gonna wanna start to frame your activities in, in the, these, in this terminology, um, as you move forward and think about value-based care,
Speaker 2:Great reminders and great insight. And I suppose at this point, we can just kind of hold our breath and wait to get that notice, uh, that the rules have been released, the final rules have been released, rather until then, uh, great, great guidance and, and we should all be, uh, dusting off those proposed rules, making sure we remember, uh, what the agencies had said about a year ago. And then of course, being prepared, uh, to, uh, uh, to, to move forward and to start speaking in terms of the, the lexicon that, uh, HHS is putting out there for us. So, uh, Joe Christian, thanks so much for the time today. Any final thoughts on the final roles?
Speaker 4:So I, I would just say, you know, let's, let's see what happens and hopefully we're, you know, we're getting to the finish line and, um, we'll, we'll have something soon to, um, start working with, with the industry on
Speaker 2:Absolutely. A, a mentor of mine told me, uh, about a year and a half ago that we're about to enter a period where, uh, it's, uh, very, very exciting, uh, and dynamic to be a healthcare fraud and abuse lawyer. And I wasn't sure if I believed them or not, but, uh, now I do. And, uh, we certainly have a lot of exciting, uh, change ahead of us. So, uh, good luck to everyone and getting, uh, and getting those final rules out and, and, and, and reading them and incorporating them into your daily practice. Uh, thanks so much, Joe, Kristen, really appreciate the time and the insight today. This has been the latest episode of the American Health Association Fraud and Abuse Podcast. I'm Matt Wetzel, and we'll return next month with another episode. Thanks so much.