Understanding the Implications of the End of the Public Health Emergency and Blanket Stark Law Waivers

January 31, 2023

On Monday, January 30, 2023, the Biden Administration announced that the Public Health Emergency ("PHE"), declared in response to the COVID-19 pandemic, would only be extended one final time to May 11, 2023. The move is in line with the Administration's previous statements to “give at least 60 days’ notice prior to termination of the (Public Health Emergency),” the White House statement said.

The end of the PHE will have major implications for health care providers that have entered into or restructured arrangements in accordance with the Department of Health and Human Services ("HHS") blanket waivers.

The COVID-19 pandemic presented numerous challenges for the healthcare industry, including compliance with federal regulations such as the Stark Law. The Stark Law prohibits physicians from making referrals for certain designated health services to entities in which they have a financial interest. In response to the PHE, HHS issued a number of blanket waivers under Section 1877(g) of the Social Security Act allowing providers to respond to the crisis without fear of violating the Stark Law's strict self-referral restrictions. The waivers applied to a broad range of activities, including telehealth services, the provision of personal protective equipment, and the sharing of office space and personnel.

With the end of the PHE, the waivers will no longer be in effect, and providers must once again adhere to the strict requirements of the Stark Law.

Providers utilizing the blanket waivers as part of their COVID-19 response efforts should take steps to ensure their activities are consistent with the self-referral restrictions of the Stark Law. They should review arrangements with other entities to determine whether they are in compliance and, if necessary, take steps to remedy any non-compliant arrangements prior to May 11, 2023.

In addition, providers should be aware they may be subject to audit by the HHS Office of Inspector General. The Office of Inspector General has been vigilant in its enforcement of the Stark Law and providers operating under the blanket waivers may be at risk of penalties if they are found in violation.

The end of the COVID-19 PHE will have significant implications for providers operating under the blanket waivers issued by HHS. Providers should take steps to ensure that their activities are consistent with the requirements of the Stark Law and be aware of the potential for audit and enforcement by the HHS Office of Inspector General. By taking these steps now, before the emergency ends, providers can ensure that they are in compliance with the law and avoid any potential penalties or consequences.

Contact the Munsch Hardt Health Care Team to discuss the implications of these changes.