Stark Law Interpretation Disallows Medication Delivery From Independent Physician Practices

Drugs for patients with cancer could be harder to access due to an interpretation of the Medicare Physician Self-Referral Law, also known as the Stark Law. The interpretation of the law could have confused many medically integrated dispensaries (MIDs), which led to an abandonment of mail-order dispensing from the MIDs, therefore making it harder for patients to access cancer treatment, according to an article published in JCO Oncology Practice.

The Stark Law was passed in 1989 and was aimed at preventing fraud and abuse. The law “prohibits physicians from referring patients to receive designated services from entities in which they may have a financial relationship,” according to the authors, but was ambiguous when it came to mail-order dispensing through MIDs, which are dispensing pharmacies embedded in an oncology center. MIDs were allowed to dispense mail orders throughout the pandemic but the law was reinterpreted in 2021, which called this practice into question.

Prescription Mailing Box | Image credit: Sherry Young - stock.adobe.com

Medically integrated specialty pharmacies have become more popular within the past decade due to the increased usage of oral medications in cancer treatment. Patient adherence is improved due to these pharmacies and costs have been reduced. The pharmacy team can access a patient’s electronic health record to see if there have been any complications due to the drug, which helps in determining whether to refill prescriptions.

Patients who are older and/or living in underserved communities are the most affected by this change, as many of these patients do not have the means to pick up prescriptions in person. Studies have shown that patients who live further away from an MID are at greater risk of disparity and are disadvantaged from not having a mail-order option. A study found that 40% of patients living within 20 miles of a clinic were at risk of disparity compared with 67% of patients living 20 to 50 miles away and 61% of patients living more than 50 miles away.

Although an amendment was recently introduced to clarify the Stark Law guidance, problems with this guidance still exist, with many patients having to stop their MID mail-order medications in favor of using pharmacy benefit managers (PBMs) that are less integrated in the clinical side of the patients they mail medications to. These PBMs are often not reachable by the doctor and coordination in patient care is far more difficult compared with an MID. This can cause problems when treating a patient with cancer.

In their article, the authors supply quotes from patients and oncologists at Tennessee Oncology who report the necessity of mail-order dispensing and the consequences of the rule on their health and lives. “Honestly, if she couldn’t get drug to her doorstep paired with our closed loop processes, I don’t think she would have turned the corner,” an oncologist said of a patient who had previously received her prescribed medication through the mail.

Some criticisms of the amendment that would allow oral dispensing in practices include that there may be financial motivation from physicians, as physician-owned practices are the ones who are most affected by the new interpretation of the guidelines. However, the authors argue that physicians are not any more motivated by a pay-day than other members of the health care system. They also said that the data on prescribing behavior and quantity of drugs prescribed show no change when dispensing is integrated or when a patient is mailed their treatment.

The amendment to the Stark Law would make it so that services that relate to drugs and administration activities would not be covered by the Stark Law. The authors claim that this amendment would keep treatment of cancer between the oncologist and the patient alone.

Reference

Mullangi S, Jain AK, Wilfong L, Schleicher S. New federal guidance makes it harder for patients with cancer to access drugs. JCO Oncol Pract. Published online January 30, 2024. doi:10.1200/OP.23.00691