Representatives Jackie Speier (D-California) and Dina Titus (D-Nevada) have introduced HR 2143, the Promoting Integrity in Medicare Act of 2019 (PIMA), which – if enacted – would narrow the “Stark” law’s exceptions and have a direct impact on the services provided by physicians who self-refer for the performance of certain designated health services. The 2019 bill is similar to previous proposals introduced by Representative Speier in prior years.

PIMA would strengthen the Stark law by excluding specified complex “non-ancillary services” from the Stark law’s in-office ancillary services (IOAS) and physicians’ services exceptions, increasing penalties for violations, and adding compliance review provisions. With certain exceptions, PIMA would define non-ancillary services as: advanced diagnostic imaging studies; anatomic pathology services; radiation therapy services and supplies; physical therapy services; and any other service the Secretary determines “is not usually provided and completed as part of the office visit to a physician’s office in which the service is determined to be necessary.” Note that the definition of specified non-ancillary service would not include: (1) services furnished in an urban area to an individual who resides in a rural area on the same day as the patient’s initial office visit; (2) services furnished as part of a Medicare shared savings program or accountable care organization; (3) services provided under a CMS Innovation Center model; or (4) services provided by an integrated multi-specialty group practice (as defined in the legislation).

Furthermore, for purposes of the Stark law and the Medicare anti-markup rule, PIMA would restrict the exclusion contained in the current definition of the term “entity” in the Stark rules from applying to the technical component or the professional component of a specified non-ancillary service. Such a change would essentially bar referring physician practices from billing Medicare for remote interpretations of advanced diagnostic imaging studies provided by contractors via teleradiology.

The proposed legislation would provide for increased penalties for Stark law violations involving these specified non-ancillary services, providing that:

  • Any person that presents or causes to be presented a bill or a claim for a service that such person knows or should know is for a service for which payment may not be made… or for which a refund has not been made… shall be subject to a civil money penalty of not more than $15,000 for each such service unless such bill or claim included a bill or claim for a specified non-ancillary service, in which case the civil money penalty shall be not more than $25,000 for each such service….
  • Any physician or other entity that enters into an arrangement or scheme… which the physician or entity knows or should know has a principal purpose of assuring referrals by the physician to a particular entity which, if the physician directly made referrals to such entity, would be in violation of this section, shall be subject to a civil money penalty of not more than $100,000 (or $150,000 if such referrals are for specified non-ancillary services)….

These amendments would apply to services furnished approximately one year after enactment. The legislation also would direct the Secretary, in consultation with the Office of Inspector General, to review compliance of referrals for certain non-ancillary services within 180 days of the bill’s enactment. The compliance review must: (1) target certain types of entities that are considered a “high risk of noncompliance” with respect to billing for non-ancillary services and (2) include prepayment reviews, claims audits, focused medical review, and computer algorithms designed to identify payment or billing anomalies.