CMS Extends Fraud and Abuse Waivers for ACO Shared Savings Program

On October 17, 2014, the Centers for Medicare and Medicaid Services (CMS) extended its interim final rule regarding fraud and abuse waivers for accountable care organizations (ACOs) that participate in the Medicare Shared Savings Program. The Medicare Shared Savings Program was one of the initial steps taken under the Affordable Care Act to both increase quality and lower costs in the Medicare program. ACOs that participate in the Medicare Shared Savings Program can share in the savings generated to Medicare.

Originally, the interim final rule was published in the November 2, 2011 Federal Register, and had the typical three-year period before becoming a final rule. The continuation of the interim final rule extends the timeline for an additional year, establishing a new deadline of November 2, 2015. The interim final rule offers five waivers to ACOs, which allow healthcare entities to form and operate ACOs without fear of violating federal fraud and abuse laws. The ACO waivers include:

An ACO participation waiver;

An ACO pre-participation waiver;

A compliance with the Physician Self-Referral (Stark) law waiver for the Gainsharing Civil Monetary Penalties (CMP) and Anti-Kickback Statute (AKS);

A shared savings distribution waiver; and

A patient incentive waiver.

CMS offered these exemptions to the Stark law, AKS, and Gainsharing CMP to encourage ACOs to participate in the Medicare Shared Savings Program. Noting the success of the waivers, CMS extended the deadline in an attempt to prevent disruptions in the ongoing operations of ACOs. Additionally, CMS was concerned that the expiration of the interim final rule would result in considerable legal uncertainty for ACOs and, in turn, place the success of the Medicare Shared Savings Program at risk. In its announcement, CMS adamantly affirmed its commitment to establishing ACO waivers.

CMS’s deadline extension also allows time for further comments from providers, policymakers, and others with a stake in the interim final rule. Specifically, CMS requested input regarding:

Whether the existing waivers serve the needs of ACOs and Medicare;

How and to what extent ACOs are using the waivers;

Whether the waivers adequately protect the Medicare program and beneficiaries from the types of harms associated with referral payments or payments to reduce or limit services; and

Whether there are new or changed considerations that should inform the development of additional notice and comment rulemaking.

Wachler & Associates regularly counsels healthcare providers regarding compliance with ACO requirements, the Stark Law, AKS, and other fraud and abuse laws. If you have any questions regarding ACOs or how CMS’s interim final rule and ACO waivers may impact your health care entity, or seek assistance in commenting on any of the provisions, please contact an experienced healthcare attorney at 248-544-0888 or via email at wapc@wachler.com.