The Centers for Medicare & Medicaid Services recently announced updates to the voluntary self-referral disclosure protocol (SRDP), including revisions to streamline SRDP submissions. Providers and suppliers may report and resolve technical violations under the physician self-referral law (commonly known as the Stark Law) using the voluntary SRDP process by submitting information to CMS about actual or potential violations of the Stark Law.
The revised SRDP process makes three key changes to reduce burdens on self-disclosing providers by permitting them to:
- use a single Group Practice Information Form to report noncompliance with the Stark Law’s group practice definition, rather than completing separate forms for each individual physician in a group that had a prohibited referral due to such noncompliance;
- submit a single Physician Information Form to disclose multiple compensation arrangements with different physicians who each stand in the shoes of the practice organization that is party to the noncompliant arrangement; and
- electronically submit an entire SRDP submission, removing the requirement to submit a hard copy of the signed certification statement.
Disclosing parties must use the updated SRDP forms (zip file download) for disclosures submitted on or after March 1, 2023.
Background
Section 6409 of the Patient Protection and Affordable Care Act required CMS to create a voluntary self-disclosure process that allows Medicare providers and suppliers to self-disclose actual or potential violations of the Stark Law. These technical violations arise frequently, as the Stark Law prohibits physicians from referring designated health services (DHS) — such as hospital services; laboratory services; prescription drugs; radiology or other imaging services; physical therapy; durable medical equipment, prosthetics, orthotics and supplies; and certain other services — to an entity, including their own medical practices, where they or their families have a compensation or ownership relationship, unless the referral and/or relationship is protected by meeting each element of an enumerated Stark Law exception. The Stark Law is a strict-liability statute, and failure to meet every element of an applicable exception results in a prohibition on submitting a claim for payment for the DHS service stemming from an impermissible referral.
When a provider discovers a potential violation under the Stark Law, the SRDP process may be an option providers consider to address the noncompliance. CMS often settles such violations for a fraction of the amount received for the improperly referred DHS, rather than the full financial penalties set forth in the statute, which financial penalties can include a refund of all Medicare receipts at issue (multiplied by up to three if challenged under a False Claims Act case) plus civil monetary penalties, among other potential penalties. The industry has embraced the SRDP for these technical violations and has submitted a significant number of SRDP filings, but there is a significant backlog, with CMS previously reporting from its own data that well over half of all submissions remain unaddressed.
Under the current SRDP process, every physician that made a Stark Law-prohibited referral must be disclosed through a separate Physician Information Form for each noncompliant financial arrangement. The Physician Information Form can be time-consuming to complete and providers often have been required to respond to repetitive questions, particularly when multiple disclosed physicians had the same financial relationship with the disclosing party. For example, when a physician group practice is making a voluntary disclosure as a result of a problematic compensation formula or some other groupwide issue that can implicate most or all of the group’s physician owners and employees in the same manner, the current SRDP effectively requires reporting the same conduct for each physician through separate, individual Physician Information Forms.
Last year, CMS solicited public comments to streamline and reduce burdens from the SRDP process. The latest updates to the SRDP process appear to reflect this request for public comment and desired changes.
Group Practice Information Form
The updated SRDP forms include a new Group Practice Information Form for physician practices to use to report noncompliance with the group practice definition under 42 C.F.R. § 411.352. Physician practices must comply with the group practice definition to qualify for the Stark Law exceptions for in-office ancillary services or for physician services, but where a practice discovers that it did not satisfy all the group practice criteria, the practice can use the Group Practice Information Form to disclose the lacking criteria. The new Group Practice Information Form allows disclosures of noncompliance with the group practice definition under Stark Law on one form under the same set of facts without using individual Physician Information Forms for each of the group’s physicians covered by the SRDP submission, reducing the paperwork necessary in such instances.
While the disclosing party still must submit the general CMS-10328 SRDP Form, in addition to the Group Practice Information Form, the new format reduces burdens on the disclosing party and CMS by requiring the disclosing party to complete only the “Pervasiveness of Noncompliance” section in the Group Practice Information Form, rather than requiring the disclosing party to include this information in each separate Physician Information Form. Further, disclosing entities using the Group Practice Information Form still must provide some information about the individual physicians and their individual prohibited referrals in a spreadsheet, including whether each physician is/was an owner, employee or independent contractor of the practice; whether each physician received compensation in a manner that was inconsistent with the group practice requirements; and the period of each physician’s noncompliance.
That said, the burden on a disclosing group practice will be reduced to preparation of a single form along with a spreadsheet, and this streamlining likely will aid CMS’ review since it won’t have to read multiple Physician Information Forms to verify that all of the group’s physicians’ circumstances are the same in a single SRDP submission. Consequently, the streamlined approach also may have the effect of expediting SRDP resolutions.
Physician Information Form
The updated SRDP forms include revised instructions in the Physician Information Form to permit disclosing parties to submit a single Physician Information Form for all physicians who have the same type of noncompliant compensation arrangement as the physician organization. In other words, in circumstances where all the physician owners of an organization are required to “stand in the shoes” of a physician organization that has a prohibited financial arrangement with a DHS entity, similar to the Group Practice Information Form, the disclosing party will experience less burden and duplication.
Such circumstances are common when a hospital must disclose a relationship with a physician practice (a type of physician organization) where each owner stands in the shoes of his or her practice. Previously, such disclosure would have required the relationship with each physician to be separately disclosed. Notably, this use of a single Physician Information Form applies only if the physicians involved are parties to the same noncompliant compensation arrangement. If there are different noncompliant compensation arrangements — i.e., only certain group practice owners having a separate relationship such as leasing real estate without a written arrangement — the disclosing party likely would need to submit individual Physician Information Forms for such arrangements.
Disclosing entities using a single Physician Information Form under these circumstances still must separately provide additional information about the individual physicians involved in the same noncompliant compensation arrangements as the organization. This separate information includes a list identifying the individual physicians and the period of each physician’s noncompliance relative to the entire noncompliant arrangement. Again, however, like the Group Information Form, the burden on healthcare providers will be reduced while also streamlining CMS’ review by reducing the necessary paperwork.
Electronic Submission for Signed Certifications
The updated SRDP forms include a modification to the required signed certification that must be submitted for each voluntary disclosure. Specifically, the certification may be submitted electronically with the rest of an SRDP submission. Previously, CMS required disclosing parties to submit a hard copy of the signed certification separately from the electronic submission. This meant disclosing parties could submit the rest of an SRDP electronically, but such entities would still need to coordinate “wet” signatures and mail certifications separately to CMS at the Division of Technical Payment Policy. This change is part of CMS’ longer-term trend under the SRDP to reduce the hard copy submissions.
Practical Takeaways
Taken together, CMS’ updates to the SRDP streamline the process of reporting and resolving noncompliance with the Stark Law. While the revisions are incremental, they are consistent with CMS’ wider context aiming to ease Stark Law compliance. Further, the actual updates likely will reduce the burden for some providers, particularly related to very common circumstances for disclosures such as noncompliance with the group practice definition and hospital submissions involving arrangements with physician organizations. The healthcare industry likely will welcome the streamlined SRDP forms, as the frequency of voluntary disclosures implicating the Stark Law continues to grow and such disclosures may be necessary for some physician organizations after CMS’ recent clarifications on group practice compensation.