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20 Health Law. 1 (2007-2008)

handle is hein.journals/healaw20 and id is 1 raw text is: THE ABA HEALTH LAW SECTION


continued its efforts in Phase III to reduce
the regulatory burden on the healthcare
industry through its interpretation and
modification of previously promulgated
exceptions to the Stark law's general
prohibition on referrals. The new regula-
tions will be effective December 4, 2007.
Although Phase III is intended as the
final phase of the CMS rulemaking
process, it is actually not the last piece of
the Stark puzzle. There are several other
significant rulemaking proposals, pending
legislation, and a CMS mandate regarding
disclosures of hospital-physician financial
relationships, any and all of which may
lead to more changes to the Stark regula-
tions and may have a profound impact on
the healthcare industry. This article is
intended nevertheless to set forth the full
picture of the Stark law and regulations
as of the conclusion of the Phase III rule-
making, and to provide health industry
counsel with a tool to assist in navigating
through the Stark regulations. This article
will: (1) address the highlights of Phase
III; (2) identify potential future changes
to the Stark regulations; and (3) set forth
the complete Stark regulatory scheme as
finalized by Phase III.

continued on page 3

Andrew B. Wachler,
Wachler & Associates,
Royal Oak, MI
Adrienne Dresevic,
Wachler & Associates,
Royal Oak, MI
On September 5, 2007, the Centers
for Medicare and Medicaid Services
(CMS) completed the long-awaited
third and final installment in its rulemak-
ing process under the federal physician
self-referral prohibition commonly known
as the Stark law.' The new final rule,2
referred to as Phase III, responds to
public comments regarding the Phase II
interim final rule with comment period
published on March 26, 2004,' and
addresses the entire Stark law regulatory
scheme. As in Phases I and I1, CMS has


Highlights of the Phase III final rule, potential
future changes, and the overall regulatory scheme

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