Skip to Content

Addressing Stark Liability: New FAQs Provide Additional Food for Thought

on Wednesday, 30 October 2013 in Health Law Alert: Erin E. Busch, Editor

The Centers for Medicare and Medicaid Services (“CMS”) recently released eight frequently asked questions concerning the Self-Referral Disclosure Protocol (“SRDP”). The SRDP is a product of the Patient Protection and Affordable Care Act of 2010 and provides a process for providers and suppliers to self-disclose violations of the physician self-referral statute (Stark law). The following FAQs respond to issues that frequently arise when providers or suppliers consider disclosing through the SRDP.


FAQs 9086 and 9088 address successor liability for Stark violations when a seller has disclosed a violation to CMS and a purchaser subsequently takes assignment of a Medicare provider agreement before the disclosure is settled. In FAQ 9086, CMS states that the purchaser is liable for overpayments as of the effective date of the change of ownership, including overpayments related to noncompliance with Stark before the effective date of the change of ownership. In this case, the purchaser may: (a) substitute itself as the disclosing party and resolve the disclosure, including making certification to CMS that the information in the disclosure is truthful, and acknowledging that it took assignment of the seller’s provider agreement; (b) withdraw the disclosure if it determines a violation did not occur; or (c) withdraw the disclosure and repay the full amount of the overpayment to CMS. Again, in FAQ 9088, CMS states that the liability for an overpayment due to a Stark law violation lies with the current party to the Medicare Provider Agreement and that any release from liability will be to the current party. [For additional information on successor liability, see this previously published Health Law Advisory article].


FAQs 9090, 9094 and 9100 address coordination with the Office of Inspector General (“OIG”). The SRDP is only intended to address violations of Stark law. The SRDP submission instructions state that an arrangement that violates the Anti-Kickback Statute should be disclosed through the OIG’s Self-Disclosure Protocol. In FAQ 9090, CMS states that if a disclosing party is also making a disclosure to the OIG involving the same arrangement or parties, the disclosing party must state that it is making the contemporaneous disclosure to the OIG. CMS could decide that an arrangement only disclosed through the SRDP involves conduct that is more appropriate for resolution under the OIG’s Self-Disclosure Protocol. FAQ 9094 states that CMS will coordinate with the OIG to appropriately resolve conduct to prevent duplicate overpayment recoveries. FAQ 9100 also clarifies that any release from liability under the SRDP is limited to liabilities under Stark. A release from liability under the SRDP would not release the party from liability under the Anti-Kickback Statute or other laws, including the False Claims Act.


FAQs 9092, 9096, and 9098 address SRDP documentation and submission requirements. FAQ 9092 reminds disclosing parties that they should provide information that the noncompliant arrangement was either terminated or brought into compliance. This could be demonstrated through submission of written contracts or other documentation. FAQ 9096 states that there is no preferred format for an initial submission to the SRDP. Submissions should be in a readable format, such as Microsoft Word, Excel or PDF. Many commenters have questioned whether CMS would provide examples or redacted versions of previous SRDP submissions. In FAQ 9096, CMS states that it does not intend to provide examples or redacted copies. Finally, in FAQ 9098, CMS addresses documentation (e.g., compliance program documents, valuation opinions and other supporting documentation) that should be submitted with the initial SRDP disclosure. While copies of compliance programs and other supporting documentation are not required to be submitted, CMS states that a disclosing party may include as much information as it deems necessary to show the “severity and extent of the noncompliant conduct and how the noncompliant conduct was cured” or otherwise brought into compliance. CMS reminds disclosing parties to be brief in the explanation of supporting documentation and that CMS may request additional documentation throughout the settlement process.


There are many issues that must be addressed in determining whether the disclosure of an arrangement or violation through the SRDP is appropriate. These recent FAQs, along with previous CMS and OIG FAQs and instructions under the SRDP itself, should be used and considered as providers and suppliers determine how to resolve potential or actual violations.


Michael W. Chase

1700 Farnam Street | Suite 1500 | Omaha, NE 68102 | 402.344.0500