Stark on Steroids

August 8, 2007 at 3:35 pm Leave a comment

The Centers for Medicare and Medicaid Services (CMS) has released its proposed Medicare Physician Fee Schedule payment update for fiscal year 2008.   Embedded in this update are proposals for significant changes to the current Stark regulations. One change that could potentially affect every healthcare system, providers, physicians, and staff, is a proposed change in the definition of an “entity” for Stark law guidelines.    

Currently, an entity is any person or entity to which the CMS makes payments for designated health services (DHS).  The proposal would expand that definition to include any person or entity that performs DHS services.   In effect, existing situations where a physician-owned (or invested) entity provides DHS services “under arrangement” for a hospital would no longer be acceptable, even if the physician-owned facility does not receive direct payment from Medicare.   

Wow!!! “Know Your Vendor” initiatives are escalating across all verticals.  If this is to pass then there would be a huge project management impact to compliance offices and the staff responsible for entities impacted by this new legislation.   As we have discovered over the past 3 years, few hospitals do not have updated, reliable vendor information.  Notifying those potentially impacted would be a time consuming and costly project. 

This highlights the dynamic nature of healthcare regulation.  In this constantly changing – and escalating – “prove who you are” environment, healthcare organizations benefit from a flexible and centralized vendor management system.    

Vendormate customers currently require their vendors to self-disclose any conflict of interest scenarios.  Fortunately for Vendormate customers, the capability to push new compliance acknowledgements to their vendors is a manageable experience.  

Our view:  Those early adopters who have invested in and implemented Vendor Information Management initiatives are better prepared for the onslaught of regulatory requirements coming down the pike which should prevent a compliance fire drill.  


Andy Monin 

Entry filed under: Stark, vendor compliance.

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