Legal Barriers to Good Care Coordination


Blog by W. Stephen Love, President/CEO DFW Hospital Council


In today’s healthcare profession, we focus on population health, improved care and better value. We call this the “Triple Aim” of improving the patient experience. Hospitals and medical providers have been accused of operating within “silos,” meaning essentially people who don’t share information or cohesively work together. Today, we are attempting to move towards clinical integration, with an emphasis on teamwork for better care coordination.

A considerable roadblock to our Triple Aim is a pair of outdated rules requiring congressional changes. Many healthcare attorneys are familiar with the Ethics in Patient Referrals Act (or “Stark law”), the federal anti-kickback statute, the civil monetary penalties law (“CMP”) prohibiting hospital payments to physicians to reduce or limit services (the “gainsharing CMP”), and the CMP prohibiting beneficiary inducements. In a fee-for-service payment system, these “program integrity laws” can serve as a necessary check on inappropriate payment arrangements that are not in the best interest of the patient.

In terms of new payment and delivery arrangements that improve quality and lower costs, these laws may be accidently triggered. For example, a physician who adopts a bundled payment arrangement in collaboration with a physician team may violate the anti-kickback statute. Or, a physician who seeks to provide services like care management, extended office hours, or telephone consultations, may implicate the CMP prohibiting beneficiary inducements.

In 2012, the Government Accountability Office (“GAO”) issued a report that examined the roadblock of the program integrity laws to delivery system innovation. The GAO concluded that the program integrity laws may “constrain the development of financial incentive programs that would align hospital and physician incentives to provide more cost-effective care.” The GAO report also noted that, while regulators have outlined some exceptions to the program integrity laws, “constraints of existing exceptions and safe harbors make it difficult to design and implement a comprehensive program for participating physicians and patient populations.”

At this moment, hospitals and physicians must comply with outdated rules. To be fair, Congress recently acknowledged the need for changes where hospitals are only subject to portions of the CMP law when reducing or limiting medically necessary care. Two urgent priorities are to create an anti-kickback safe harbor for clinical integration programs and re-focus the Stark law to its original intent.

We urge Congress to remove these roadblocks to care coordination so we can focus on clinical integration. What is in the best interest of our patients is always the right thing to do.