Title: Stark Administrative Simplification Act of 2017
Policy area: Health

Summary:
Stark Administrative Simplification Act of 2017
This bill establishes lesser penalties for technical noncompliance with the Stark Rule against self-referral under Medicare. "Technical noncompliance" means, with respect to a compensation arrangement, that the arrangement: (1) is not set forth in writing, (2) is not signed by one or more parties, or (3) violates the rule due to the arrangement's expiration.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3173 Introduced in House (IH)]

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115th CONGRESS
  1st Session
                                H. R. 3173

 To amend title XVIII of the Social Security Act to create alternative 
    sanctions for technical noncompliance with the Stark rule under 
                   Medicare, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 10, 2017

  Mr. Marchant (for himself, Mr. Kind, and Mr. Meehan) introduced the 
   following bill; which was referred to the Committee on Energy and 
  Commerce, and in addition to the Committee on Ways and Means, for a 
 period to be subsequently determined by the Speaker, in each case for 
consideration of such provisions as fall within the jurisdiction of the 
                          committee concerned

_______________________________________________________________________

                                 A BILL


 
 To amend title XVIII of the Social Security Act to create alternative 
    sanctions for technical noncompliance with the Stark rule under 
                   Medicare, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Stark Administrative Simplification 
Act of 2017''.

SEC. 2. ALTERNATIVE SANCTIONS FOR TECHNICAL NONCOMPLIANCE WITH STARK 
              RULE UNDER MEDICARE.

    Section 1877(g) of the Social Security Act (42 U.S.C. 1395nn(g)) is 
amended--
            (1) in paragraph (1), by striking ``No'' and inserting 
        ``Subject to paragraph (7), no'';
            (2) in paragraph (2), by striking ``If'' and inserting 
        ``Subject to paragraph (7), if'';
            (3) in paragraph (3), by striking ``Any'' and inserting 
        ``Subject to paragraph (7), any''; and
            (4) by adding at the end the following new paragraph:
            ``(7) Alternative sanctions for technical noncompliance.--
                    ``(A) Single penalty for compensation arrangements 
                in technical noncompliance.--In the case of a 
                compensation arrangement between a physician (or an 
                immediate family member of such physician) and a person 
                or entity that is in violation of subsection (a)(1) 
                solely due to technical noncompliance, instead of the 
                sanctions described in paragraphs (1), (2), and (3) for 
                any such violation, the person or entity with respect 
                to such arrangement shall be subject to a single civil 
                monetary penalty under this paragraph in an amount that 
                does not exceed--
                            ``(i) in the case in which the disclosure 
                        of the violation is submitted to the Secretary 
                        not later than the date that is one year after 
                        the initial date of noncompliance, $5,000; and
                            ``(ii) in the case in which the disclosure 
                        of the violation is submitted to the Secretary 
                        after the date that is one year after the 
                        initial date of noncompliance, $10,000.
                    ``(B) Acceptance of voluntary disclosures.--
                            ``(i) In general.--Beginning as of the date 
                        of the enactment of this paragraph, the 
                        Secretary shall accept the voluntary disclosure 
                        of a technically noncompliant compensation 
                        arrangement if such voluntary disclosure is 
                        made as described in clause (iii). The 
                        Secretary may accept and reasonably rely on 
                        information provided by a person or entity that 
                        is in violation of subsection (a)(1) only 
                        because of a compensation arrangement that is 
                        technically noncompliant.
                            ``(ii) Acceptance of disclosure.--The 
                        Secretary may reject any voluntary disclosure 
                        submitted under clause (iii) within 90 days 
                        after the receipt of the disclosure only if the 
                        Secretary determines that the disclosure does 
                        not conform to the requirements described in 
                        clause (iii). If the Secretary fails to reject 
                        a voluntary disclosure within such 90-day 
                        period, the voluntary disclosure is deemed to 
                        be accepted.
                            ``(iii) Voluntary disclosure.--A voluntary 
                        disclosure described in this clause is a 
                        disclosure concerning a compensation 
                        arrangement that is submitted to the Secretary 
                        by a party to such arrangement that contains 
                        the following:
                                    ``(I) The identification of the 
                                disclosing party and all other parties 
                                to the disclosed compensation 
                                arrangement.
                                    ``(II) A description of the 
                                compensation paid under the arrangement 
                                and the dates of noncompliance.
                                    ``(III) A certification by the 
                                disclosing party that the compensation 
                                arrangement satisfies the requirements 
                                described in clause (v).
                                    ``(IV) Payment for the full amount 
                                of the civil monetary penalty under 
                                clause (i) or (ii), as applicable, of 
                                subparagraph (A).
                            ``(iv) Settlement of liability and payment 
                        of claims.--A voluntary disclosure of a 
                        technically noncompliant compensation 
                        arrangement that is made and accepted under 
                        this subparagraph shall constitute a full and 
                        complete settlement of liability under this 
                        subsection to the extent such liability is with 
                        respect to such technically noncompliant 
                        compensation arrangement. Any bill or claim for 
                        payment related to a technically noncompliant 
                        compensation arrangement shall not be subject 
                        to the sanctions under this subsection and 
                        shall be payable after a voluntary disclosure 
                        is made as described in clause (iii).
                            ``(v) Compensation arrangement 
                        requirements.--For purposes of clause 
                        (iii)(III), the requirements described in this 
                        clause, with respect to a compensation 
                        arrangement, are the following:
                                    ``(I) The compensation arrangement 
                                is technically noncompliant (as defined 
                                by subparagraph (C)).
                                    ``(II) The compensation arrangement 
                                has been cured of the technical 
                                noncompliance, or is otherwise 
                                terminated.
                                    ``(III) In the case of technical 
                                noncompliance described in subparagraph 
                                (C)(i), the compensation arrangement is 
                                consistent with fair market value, and 
                                the remuneration under the arrangement 
                                is not determined in a manner that 
                                takes into account directly or 
                                indirectly the volume or value of any 
                                referrals.
                    ``(C) Definition technical noncompliance.--For 
                purposes of this paragraph, the term `technical 
                noncompliance' means, with respect to a compensation 
                arrangement, such an arrangement that is in violation 
                of subsection (a)(1) only because--
                            ``(i) the arrangement is not set forth in 
                        writing;
                            ``(ii) the arrangement is not signed by one 
                        or more parties to the arrangement; or
                            ``(iii) the arrangement became in violation 
                        of such subsection by reason of its expiration.
                    ``(D) Applicability to pre-enactment disclosures to 
                relieve backlog.--In addition to the application of 
                this paragraph to technically noncompliant compensation 
                arrangements disclosed on or after the date of the 
                enactment of this paragraph, the Secretary shall 
                provide for the application of this paragraph to any 
                technically noncompliant compensation arrangement that 
                has been disclosed, and to which there has not been a 
                final settlement, as of the date of enactment of this 
                paragraph.
                    ``(E) Report.--Not later than 24 months after the 
                date of enactment of this paragraph, the Administrator 
                of the Centers for Medicare & Medicaid Services shall 
                submit to Congress a report on the implementation of 
                this paragraph. Such report shall include--
                            ``(i) the number of persons or entities 
                        making disclosures of technical noncompliance 
                        under this paragraph;
                            ``(ii) the amount and type of alternative 
                        sanctions collected or imposed for technical 
                        noncompliance;
                            ``(iii) the types of violations disclosed; 
                        and
                            ``(iv) such other information as the 
                        Inspector General determines may be necessary 
                        to evaluate the impact of this paragraph.''.

SEC. 3. CLARIFICATION OF THE WRITING REQUIREMENT AND SIGNATURE 
              REQUIREMENT FOR ARRANGEMENTS PURSUANT TO THE STARK RULE 
              UNDER MEDICARE.

    (a) Writing Requirement.--Section 1877(h)(1) of the Social Security 
Act (42 U.S.C. 1395nn(h)(1)) is amended by adding at the end the 
following new subparagraph:
            ``(D) Written requirement clarified.--In the case of any 
        requirement pursuant to this section for a compensation 
        arrangement to be in writing, such requirement shall be 
        satisfied by such means as determined by the Secretary, 
        including by a collection of documents, including 
        contemporaneous documents evidencing the course of conduct 
        between the parties involved.''.
    (b) Signature Requirement.--Section 1877(e) of the Social Security 
Act (42 U.S.C. 1395nn(e)) is amended--
            (1) in paragraph (1)(A)(i), by inserting ``before or not 
        later than 90 days after the effective date of the lease'' 
        after ``signed by the parties'';
            (2) in paragraph (1)(B)(i), by inserting ``before or not 
        later than 90 days after the effective date of the lease'' 
        after ``signed by the parties''; and
            (3) in paragraph (3)(A)(i), by inserting ``before or not 
        later than 90 days after the effective date of the 
        arrangement'' after ``signed by the parties''.

SEC. 4. INDEFINITE HOLDOVER FOR LEASE ARRANGEMENTS AND PERSONAL 
              SERVICES ARRANGEMENTS PURSUANT TO THE STARK RULE UNDER 
              MEDICARE.

    Section 1877 of the Social Security Act (42 U.S.C. 1395nn) is 
amended--
            (1) in subsection (e)--
                    (A) in paragraph (1), by adding at the end the 
                following new subparagraph:
                    ``(C) Holdover lease arrangements.--In the case of 
                a holdover lease arrangement for the lease of office 
                space or equipment, which immediately follows a lease 
                arrangement described in subparagraph (A) for the use 
                of such office space or subparagraph (B) for the use of 
                such equipment and that expired after a term of at 
                least one year, payments made by the lessee to the 
                lessor pursuant to such holdover lease arrangement, 
                if--
                            ``(i) the lease arrangement met the 
                        conditions of subparagraph (A) for the lease of 
                        office space or subparagraph (B) for the use of 
                        equipment when the arrangement expired;
                            ``(ii) the holdover lease arrangement is on 
                        the same terms and conditions as the 
                        immediately preceding arrangement; and
                            ``(iii) the holdover arrangement continues 
                        to satisfy the conditions of subparagraph (A) 
                        for the lease of office space or subparagraph 
                        (B) for the use of equipment.''; and
                    (B) in paragraph (3), by adding at the end the 
                following new subparagraph:
                    ``(C) Holdover personal service arrangement.--In 
                the case of a holdover personal service arrangement, 
                which immediately follows an arrangement described in 
                subparagraph (A) that expired after a term of at least 
                one year, remuneration from an entity pursuant to such 
                holdover personal service arrangement, if--
                            ``(i) the personal service arrangement hmet 
                        the conditions of subparagraph (A) when the 
                        arrangement expired;
                            ``(ii) the holdover personal service 
                        arrangement is on the same terms and conditions 
                        as the immediately preceding arrangement; and
                            ``(iii) the holdover arrangement continues 
                        to satisfy the conditions of subparagraph 
                        (A).''; and
            (2) in subsection (h)(1), as amended by section 3(a)--
                    (A) in the heading, by inserting ``; holdover 
                arrangement'' after ``remuneration''; and
                    (B) by adding at the end the following new 
                subparagraph:
            ``(E) Holdover arrangement.--The term `holdover 
        arrangement' means an arrangement, with respect to an agreement 
        (including a lease or other arrangement) that has expired but 
        as of the date of such expiration had been in compliance with 
        the applicable requirements of this section, under which the 
        parties to such expired agreement have, since such date of 
        expiration, continued to perform under the terms and conditions 
        of such expired agreement.''.
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