On November 16, 2015, the Centers for Medicare and Medicaid Services (CMS) published the 2016 Medicare Physician Fee Schedule final rule with comment period in the Federal Register at 80 Fed. Reg. 70,886, which includes a final rule to amend CMS regulations implementing and interpreting the Stark Law, 42 C.F.R. § 411.351 et seq. (the Final Rule). CMS published the proposed rule in the Federal Register on July 15, 2015, at 80 Fed. Reg. 41,686, 41,909–30, 41,953–58 (the Proposed Rule), which was summarized in a Special Report. The Final Rule will be effective on January 1, 2016 (with the exception of changes to the definition of bona fide investment levels for physician-owned hospitals discussed below in this Special Report, which will not be effective until January 1, 2017). CMS confirms, however, that many provisions of the Final Rule are “policy clarifications,” and thus are intended to inform conduct that predates the effective date of the Final Rule.

According to CMS, the Final Rule “updates the physician self-referral regulations to accommodate delivery and payment system reform, to reduce burden, and to facilitate compliance.” 80 Fed. Reg. at 71,301. Notably, the Final Rule adds two new Stark Law exceptions—one for financial assistance to practices to recruit primary care non-physician practitioners and one for “timeshare” arrangements.