What Are Designated Health Services?

A proposed change to signature requirements in 2019 may effect your practice.

The Physician Self-referral Law, or Stark Law,  prohibits physicians to refer Medicare patients for certain designated health services (DHS) to an entity with which the physician (or a member of the physician’s immediate family) has a financial relationship. The DHS entity is held to the same law.

The following are DHS:

• Clinical laboratory services
• Physical therapy services
• Occupational therapy services
• Outpatient speech-language pathology services
• Radiology services
• Radiation therapy services and supplies
• Durable medical equipment and supplies
• Parenteral and enteral nutrients, equipment, and supplies
• Prosthetics, orthotics, and prosthetic devices and supplies
• Home health services
• Outpatient prescription drugs
• Inpatient and outpatient hospital services

This list is updated annually to account for changes in the most recent CPT and HCPCS Level II publications. Tables 44 and 45 in the 2018 Medicare Physician Fee Schedule (MPFS) Final Rule highlight the most recent additions and deletions to the Physician Self-Referral Code List.

TABLE 44: Additions to the Physician Self-Referral List of CPT/HCPCS Codes

TABLE 45: Deletions from the Physician Self-Referral List of CPT®/HCPCS Codes

The updated, comprehensive Code List, effective Jan. 1, 2018, is available on the CMS website. The Code List also identifies items and services that may qualify for exceptions to the physician self-referral law.

New Writing and Signature Requirements on the Horizon

Many of the exceptions for compensation arrangements must be made in writing and signed by the parties. The Bipartisan Budget Act of 2018 (BBA) added provisions to the Physician Self-referral Law pertaining to the writing and signature requirements in certain compensation arrangement exceptions to the statute’s referral and billing prohibitions.

To codify the BBA regulations, the Centers for Medicare & Medicaid Services (CMS) is proposing a new special rule on compensation arrangements and to amend existing provisions to codify the statutory provisions in their guidelines.

As indicated (but not codified) in the 2016 MPFS final rule, the writing requirement may be satisfied by a collection of documents, including contemporaneous documents evidencing the course of conduct between the parties. CMS is also proposing to codify the BBA signature requirement and grant parties 90 days to obtain the required signatures.

“We expect that the proposal regarding temporary noncompliance with signature arrangements would reduce burden by giving parties additional time to obtain all required signatures,” CMS states in the 2019 MPFS proposed rule.

CMS is asking for comments regarding the best approach for codifying in regulation this provision of the Bipartisan Budget Act of 2018. The comment period ends Sept. 10.

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Renee Dustman

Executive Editor at AAPC

Renee Dustman, BS, AAPC MACRA Proficient, is an executive editor at AAPC. She holds a Bachelor of Science degree in Media Communications - Journalism. Renee has more than 20 years experience in print production and content management. Follow her on Twitter @dustman_aapc.

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