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    Comparison Chart of Anti-Kickback Safe Harbors and Stark Exceptions -- Value-Based Arrangements

    Value-Based Arrangements – Current as of March 2021

    Stark
    Stark exception to the referral prohibition related to compensation arrangements that facilitate value-based health care delivery and payment – Value-Based Arrangements 42 CFR 411.357(aa)(3) 

    Anti-Kickback
    Safe harbor to protect the exchange of anything of value between a VBE and VBE participant or between VBE participants pursuant to a value-based arrangement 42 CFR 1001.952(ee)

    The arrangement is set forth in writing and signed by the parties and is commercially reasonable.

     

    The terms of the value-based arrangement are set forth in writing and signed by the parties in advance of, or contemporaneous with, the commencement of the value-based arrangement and any material change to the value-based arrangement.

    The value-based arrangement is commercially reasonable, considering both the arrangement itself and all value-based arrangements within the VBE.

    The writing includes a description of -

    (A) The value-based activities to be undertaken under the arrangement;
    (B) How the value-based activities are expected to further the value-based purpose(s) of the value-based enterprise;
    (C) The target patient population for the arrangement;
    (D) The type or nature of the remuneration;
    (E) The methodology used to determine the remuneration; and
    (F) The outcome measures against which the recipient of the remuneration is assessed, if any.

    The writing states at a minimum:

    (i) The value-based purpose(s) of the value-based activities provided for in the value-based arrangement;
    (ii) The value-based activities to be undertaken by the parties to the value-based arrangement;
    (iii) The term of the value-based arrangement;
    (iv) The target patient population;
    (v) A description of the remuneration;
    (vi) Either the offeror's cost for the remuneration and the reasonable accounting methodology used by the offeror to determine its cost, or the fair market value of the remuneration;
    (vii) The percentage and amount contributed by the recipient;
    (viii) If applicable, the frequency of the recipient's contribution payments for ongoing costs; and
    (ix) The outcome or process measure(s) against which the recipient will be measured.

    The methodology used to determine the amount of the remuneration is set in advance of the undertaking of value-based activities for which the remuneration is paid.

    The remuneration is for or results from value-based activities undertaken by the recipient of the remuneration for patients in the target patient population.

    The remuneration exchanged:

    (i) Is in-kind;
    (ii) Is used predominantly to engage in value-based activities that are directly connected to the coordination and management of care for the target patient population and does not result in more than incidental benefits to persons outside of the target patient population; and
    (iii) Is not exchanged or used:

    (A) More than incidentally for the recipient's billing or financial management services; or
    (B) For the purpose of marketing items or services furnished by the VBE or a VBE participant to patients or for patient recruitment activities.

    The offeror does not and should not know that the remuneration is likely to be diverted, resold, or used by the recipient for an unlawful purpose.

    The offeror of the remuneration does not take into account the volume or value of, or condition the remuneration on:

    (i) Referrals of patients who are not part of the target patient population; or
    (ii) Business not covered under the value-based arrangement.

    The recipient pays at least 15 percent of the offeror's cost for the remuneration, using any reasonable accounting methodology, or the fair market value of the in-kind remuneration. If it is a one-time cost, the recipient makes such contribution in advance of receiving the in-kind remuneration. If it is an ongoing cost, the recipient makes such contribution at reasonable, regular intervals.

    The remuneration is not exchanged by:

    (i) A pharmaceutical manufacturer, distributor, or wholesaler;
    (ii) A pharmacy benefit manager;
    (iii) A laboratory company;
    (iv) A pharmacy that primarily compounds drugs or primarily dispenses compounded drugs;
    (v) Except to the extent the entity is a limited technology participant, a manufacturer of a device or medical supply;
    (vi) Except to the extent the entity or individual is a limited technology participant, an entity or individual that sells or rents durable medical equipment, prosthetics, orthotics, or supplies covered by a Federal health care program (other than a pharmacy or a physician, provider, or other entity that primarily furnishes services); or
    (vii) A medical device distributor or wholesaler that is not otherwise a manufacturer of a device or medical supplies.

    The outcome measures against which the recipient of the remuneration is assessed, if any, are objective, measurable, and selected based on clinical evidence or credible medical support.

    Any changes to the outcome measures against which the recipient of the remuneration will be assessed are made prospectively and set forth in writing.

    The parties to the value-based arrangement establish one or more legitimate outcome or process measures that:

    (i) The parties reasonably anticipate will advance the coordination and management of care for the target patient population based on clinical evidence or credible medical or health sciences support;
    (ii) Include one or more benchmarks that are related to improving or maintaining improvements in the coordination and management of care for the target patient population;
    (iii) Are monitored, periodically assessed, and prospectively revised as necessary to ensure that the measure and its benchmark continue to advance the coordination and management of care of the target patient population;
    (iv) Relate to the remuneration exchanged under the value-based arrangement; and
    (v) Are not based solely on patient satisfaction or patient convenience.

    Monitoring

    (A) No less frequently than annually, or at least once during the term of the arrangement if the arrangement has a duration of less than 1 year, the value-based enterprise or one or more of the parties monitor:

    (1) Whether the parties have furnished the value-based activities required under the arrangement;
    (2) Whether and how continuation of the value-based activities is expected to further the value-based purpose(s) of the value-based enterprise; and
    (3) Progress toward attainment of the outcome measure(s), if any, against which the recipient of the remuneration is assessed.

    (B) If the monitoring indicates that a value-based activity is not expected to further the value-based purpose(s) of the value-based enterprise, the parties must terminate the ineffective value-based activity. Following completion of monitoring that identifies an ineffective value-based activity, the value-based activity is deemed to be reasonably designed to achieve at least one value-based purpose of the value-based enterprise -

    (1) For 30 consecutive calendar days after completion of the monitoring, if the parties terminate the arrangement; or
    (2) For 90 consecutive calendar days after completion of the monitoring, if the parties modify the arrangement to terminate the ineffective value-based activity.

    (C) If the monitoring indicates that an outcome measure is unattainable during the remaining term of the arrangement, the parties must terminate or replace the unattainable outcome measure within 90 consecutive calendar days after completion of the monitoring.

    Monitoring

    The VBE, a VBE participant in the value-based arrangement acting on the VBE's behalf, or the VBE's accountable body or responsible person reasonably monitors and assesses the following and reports the monitoring and assessment of the following to the VBE's accountable body or responsible person, as applicable, no less frequently than annually or at least once during the term of the value-based arrangement for arrangements with terms of less than 1 year:

    (i) The coordination and management of care for the target patient population in the value-based arrangement;
    (ii) Any deficiencies in the delivery of quality care under the value-based arrangement; and
    (iii) Progress toward achieving the legitimate outcome or process measure(s) in the value-based arrangement.

    If the VBE's accountable body or responsible person determines, based on the monitoring and assessment conducted,  that the value-based arrangement has resulted in material deficiencies in quality of care or is unlikely to further the coordination and management of care for the target patient population, the parties must within 60 days either:

    (i) Terminate the arrangement; or
    (ii) Develop and implement a corrective action plan designed to remedy the deficiencies within 120 days, and if the corrective action plan fails to remedy the deficiencies within 120 days, terminate the value-based arrangement.

    The remuneration is not an inducement to reduce or limit medically necessary items or services to any patient.

    The value-based arrangement does not induce parties to furnish medically unnecessary items or services, or reduce or limit medically necessary items or services furnished to any patient.

    The remuneration is not conditioned on referrals of patients who are not part of the target patient population or business not covered under the value-based arrangement.

    The exchange of remuneration by a limited technology participant and another VBE participant or the VBE must not be conditioned on any recipient's exclusive use or minimum purchase of any item or service manufactured, distributed, or sold by the limited technology participant.

    If the remuneration paid to the physician is conditioned on the physician's referrals to a particular provider, practitioner, or supplier, the value-based arrangement complies with both of the following conditions:

    (A) The requirement to make referrals to a particular provider, practitioner, or supplier is set out in writing and signed by the parties.
    (B) The requirement to make referrals to a particular provider, practitioner, or supplier does not apply if the patient expresses a preference for a different provider, practitioner, or supplier; the patient's insurer determines the provider, practitioner, or supplier; or the referral is not in the patient's best medical interests in the physician's judgment.

    The value-based arrangement does not:

    (i) Limit the VBE participant's ability to make decisions in the best interests of its patients;
    (ii) Direct or restrict referrals to a particular provider, practitioner, or supplier if:

    (A) A patient expresses a preference for a different practitioner, provider, or supplier;
    (B) The patient's payor determines the provider, practitioner, or supplier; or
    (C) Such direction or restriction is contrary to applicable law under the Medicare or Medicaid programs

    Records of the methodology for determining and the actual amount of remuneration paid under the value-based arrangement must be maintained for a period of at least 6 years and made available to the Secretary upon request.

    For a period of at least 6 years, the VBE or VBE participant makes available to the Secretary, upon request, all materials and records sufficient to establish compliance with the conditions of this safe harbor.

    Outcome measure means a benchmark that quantifies:

    (A) Improvements in or maintenance of the quality of patient care; or
    (B) Reductions in the costs to or reductions in growth in expenditures of payors while maintaining or improving the quality of patient care.

    Coordination and management of care (or coordinating and managing care) means the deliberate organization of patient care activities and sharing of information between two or more VBE participants, one or more VBE participants and the VBE, or one or more VBE participants and patients, that is designed to achieve safer, more effective, or more efficient care to improve the health outcomes of the target patient population.

    Digital health technology means hardware, software, or services that electronically capture, transmit, aggregate, or analyze data and that are used for the purpose of coordinating and managing care; such term includes any internet or other connectivity service that is necessary and used to enable the operation of the item or service for that purpose.

    Limited technology participant means a VBE participant that exchanges digital health technology with another VBE participant or a VBE and that is:

    (A) A manufacturer of a device or medical supply, but not including a manufacturer of a device or medical supply that was obligated under 42 CFR 403.906 to report one or more ownership or investment interests held by a physician or an immediate family member during the preceding calendar year, or that reasonably anticipates that it will be obligated to report one or more ownership or investment interests held by a physician or an immediate family member during the present calendar year (for purposes of this paragraph, the terms “ownership or investment interest,” “physician,” and “immediate family member” have the same meaning as set forth in 42 CFR 403.902); or
    (B) An entity or individual that sells or rents durable medical equipment, prosthetics, orthotics, or supplies covered by a Federal health care program (other than a pharmacy or a physician, provider, or other entity that primarily furnishes services).

    Manufacturer of a device or medical supply means an entity that meets the definition of applicable manufacturer in 42 CFR 403.902 because it is engaged in the production, preparation, propagation, compounding, or conversion of a device or medical supply that meets the definition of covered drug, device, biological, or medical supply in 42 CFR 403.902, but not including entities under common ownership with such entity.

    Target patient population means an identified patient population selected by the VBE or its VBE participants using legitimate and verifiable criteria that:

    (A) Are set out in writing in advance of the commencement of the value-based arrangement; and
    (B) Further the value-based enterprise's value-based purpose(s).

    Value-based activity means any of the following activities, provided that the activity is reasonably designed to achieve at least one value-based purpose of the value-based enterprise:

    (1) The provision of an item or service;
    (2) The taking of an action; or
    (3) The refraining from taking an action

    Value-based activity does not include the making of a referral.

    Value-based arrangement means an arrangement for the provision of at least one value-based activity for a target patient population to which the only parties are:

    (A) The value-based enterprise and one or more of its VBE participants; or
    (B) VBE participants in the same value-based enterprise.

    Value-based enterprise or VBE means two or more VBE participants:

    (A) Collaborating to achieve at least one value-based purpose;
    (B) Each of which is a party to a value-based arrangement with the other or at least one other VBE participant in the value-based enterprise;
    (C) That have an accountable body or person responsible for financial and operational oversight of the value-based enterprise; and
    (D) That have a governing document that describes the value-based enterprise and how the VBE participants intend to achieve its value-based purpose(s).

    Value-based enterprise participant or VBE participant means an individual or entity that engages in at least one value-based activity as part of a value-based enterprise, other than a patient acting in their capacity as a patient.

    Value-based purpose means:

    (A) Coordinating and managing the care of a target patient population;
    (B) Improving the quality of care for a target patient population;
    (C) Appropriately reducing the costs to or growth in expenditures of payors without reducing the quality of care for a target patient population; or
    (D) Transitioning from health care delivery and payment mechanisms based on the volume of items and services provided to mechanisms based on the quality of care and control of costs of care for a target patient population.