October 10, 2019

ABA Adopts Health Law Section's Stark Law Resolution

At the ABA Annual Meeting on August 13, 2019 in San Francisco, the Health Law Section proposed to the House of Delegates Resolution 117B, calling on Congress to amend the Stark Law to provide clarification of critical requirements of the Law and to address concerns of physicians and other healthcare providers who potentially face significant penalties under the Stark Law as a result of entering into collaborative healthcare delivery approaches and value-based incentive payment arrangements.

The resolution was moved in the House by William W. Horton of Jones Walker LLP in Birmingham, Alabama, a delegate from the Health Law Section, and was also adopted by an overwhelming majority.

As Horton observed, Resolution 117B recommends that the Stark Law be amended to remove the statutory prohibition against payment for services furnished pursuant to a compensation arrangement that failed to meet a Stark exception solely due to technical non-compliance, and to clarify the requirement that compensation be consistent with fair market value. In addition, the Resolution recommends that Congress address inconsistencies in the treatment of compensation arrangements that vary with or take into account the volume or value of referrals and establish an exception for compensation paid under certain alternative payment arrangements in order to encourage the adoption of collaborative healthcare delivery models.