Bill That Aims to Ease Stark Penalties Receives House Committee Approval

King & Spalding
Contact

On Wednesday, September 13, the House Ways and Means Committee gave unanimous approval to H.R. 3726, the Stark Administrative Simplification Act (the “Bill”).  The Bill would amend the Stark law, codified at 42 U.S.C. § 1395nn, to establish a lesser set of sanctions for providers that self-disclose inadvertent technical violations of the Stark law’s prohibition against physician self-referral.

The Bill, introduced last week and sponsored by Rep. Keith Marchant (R-TX), would require HHS to establish an alternative protocol for technical noncompliance (APTN) to enable entities to self-disclose arrangements that were previously in “inadvertent technical noncompliance” with the Stark law.  The Bill defines “inadvertent” as an entity that is party to the arrangement that “did not know or should not have known of the noncompliance.”  The Bill further defines “technical noncompliance” to cover the following:

  • Arrangements not signed by one or more parties;
  • Holdover arrangements that remain in effect after expiration for longer than the period permitted; and
  • Arrangements where there exists contemporaneous written documentation  that identifies the parties and the items, services, space, or equipment (as applicable), but where such documentation is not sufficient to satisfy the writing requirement of an applicable exception.

The Bill would also formalize the process for HHS to accept or reject APTN disclosures. Any disclosures not rejected by HHS within 180 days would be deemed accepted.

Finally, the Bill would reduce the penalties that HHS may impose for violations disclosed pursuant to the APTN. Violations disclosed within one year after the initial date of inadvertent noncompliance would be subject to a single civil monetary penalty of $5,000. A penalty of $10,000 would apply to violations disclosed between one and three years after the initial date of inadvertent noncompliance.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© King & Spalding | Attorney Advertising

Written by:

King & Spalding
Contact
more
less

King & Spalding on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide
- hide