March 2007

The Centers for Medicare and Medicaid Services (CMS) announced today in the federal register that it will delay publication of the much anticipated Phase III final Stark self-referral regulations (which were due out by today) until March 23, 2008. According to CMS, the delay is necessary in order to allow time to review and consider the extensive public comments on the Interim Final regulations (Phase II) of the regulations which were published in 2004.  Until publication of Phase II, the Phase II rules will remain in place.  

On February 19, 2007 (but effective retroactively to January 26, 2007), the Centers for Medicare and Medicaid Services (CMS) rescinded the controversial IDTF transmittal referrenced in the February 18, 2007 entry on this Blog.  A copy of the notice can be found here: Transmittal 187.  Those guidelines would have imposed major new conditions on independent diagnostic testing facilities (IDTFs), and would have invalidated many leasing arrangements. No word yet as to whether CMS is planning to re-publish the guidelines any time soon.  Stay tuned!

A recent bill proposed by the Pennsylvania House of Representatives would, among other things, reinstate the Certificate of Need (CON) program in Pennsylvania.  Specifically, House Bill 305, introduced on February 7, 2007, would require anyone proposing to make capital expenditures in excess of $500,000 for replacement technology or $1,000,000 for equipment or improvements in connection with a covered health care facility, to obtain a CON.  Facilities subject to the CON requirements would include, among others, ambulatory surgery centers, imaging centers and cancer treatment centers using radiation therapy. 

Of even more concern to physicians is the fact that the legislation includes self-referral prohibitions similar to the federal Stark statute that would prohibit physicians from referring to health care entities (including ASCs which are not currently covered by Stark) in which they have a financial interest.  All physicians with ancillary service arrangements in Pennsylvania need to pay close attention to this and other efforts by State legislators to curb physician investment in ancillary services.