The Centers for Medicare & Medicaid Services (CMS) recently disclosed data on its 2021 and 2022 settlements concerning voluntary self-disclosures related to past or potential violations of the physician self-referral law, commonly known as the “Stark Law.” In 2022, CMS settled an unprecedented 104 self-disclosures, with the total settlement amounts exceeding $9,000,000. This figure is almost four times the number and amounts settled in 2021 and surpasses the previous record from 2016.
- Background: The Stark Law prohibits physicians from referring certain health services to entities where they or their family have a compensation or ownership relationship, unless specific exceptions are met.
- Self-Referral Disclosure Protocol (SRDP): CMS established the SRDP, as mandated by the Affordable Care Act (ACA), to allow providers and suppliers to voluntarily disclose actual or potential Stark Law violations. The primary advantage of the SRDP is that CMS often settles disclosed conduct for a fraction of the potential liability.
- Backlog of Self-Disclosures: Although CMS has increased its settlement pace, there remains a significant backlog of self-disclosures. Over half of the submissions made in the past 12 years are still pending.
- Settlement Amounts: The total amount recovered by CMS from 2022 settlements reached a record high of over $9.2 million. The average settlement amount for individual cases in 2022 was $89,306.40, which is on the lower end compared to previous years.
- Post-COVID-19 Activity: The surge in settlements in 2022 suggests that CMS has ramped up its settlement activities following the COVID-19 pandemic.