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News & Press: Legislative

AARP Endorses Tougher Restrictions on Physician Self-Referral and In-Office Ancillary Services

Tuesday, December 16, 2014   (0 Comments)
Posted by: Paul Hardin
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On Thursday, December 11, 2014, the American Association of Retired Persons (AARP), in a letter of support (.pdf) addressed to Rep. Jackie Speier (D), became the first consumer organization to publicly endorse tightening restrictions on physician self-referral by eliminating the in-office ancillary services (IOAS) exception for 4 specific services, including physical therapy, under the Stark law. In a significant win for the US health care system and the patients it serves, the 38-million-member AARP has thrown its considerable weight behind the legislation sponsored by Speier, commending her work to improve health care and reduce spending. The American Physical Therapy Association (APTA) whole-heartedly applauds AARP for this bold move. Removing these services from the IAOS exception would transform health care to save the country billions in unnecessary treatments and protect patients from being used as pawns for profit.


The Stark law prohibits a physician from making referrals for certain Medicare health services to an entity with which he or she, or an immediate family member, has a financial relationship -- unless an exception applies. The IOAS exception is intended for the delivery of services that could be quickly administered for patient convenience, such as routine lab tests or x-rays. However, physicians' expansive use of the IOAS exception to include therapy services, in a manner outside the spirit of the law, undercuts the law's very purpose and substantially increases costs to the Medicare program and its beneficiaries. The Office of Management and Budget concluded that closing the loophole for these services would save just over $6 billion over the 10-year budget window, a number to which AARP directly referred in its letter of support.


"APTA continues to urge Congress to take action to close this loophole, which threatens the integrity of the Medicare program" said APTA President Paul A Rockar Jr, PT, DPT, MS. "We'd like to see patients put back in the driver's seat, receiving treatment because they need it to be healthy, not because of the profit it will generate. It is time to take action. It is time for Congress to pass the Protecting Integrity in Medicare Act (PIMA) (H.R. 2914) and close the loophole. We are pleased to see AARP join the fight, and we stand behind them 100%."


AARP's move comes at an appropriate time as President Obama assembles his Fiscal Year 2016 budget. When the Fiscal Year 2015 budget was released earlier this year, it sought, for the second year running, to exclude 4 services--physical therapy, radiation therapy, anatomic pathology, and advanced imaging--from the IOAS exception to the Stark law.


"This is a huge win for health care. We've been working hard for years to make these changes, and it is exciting to see a major influencer like AARP join the effort," said Terry Brown, PT, DPT, president of the Private Practice Section of the APTA. "These changes to the IAOS exception would shift the focus in health care from profit and put it back on the patient."


APTA is a founding member of the Alliance for Integrity in Medicare (AIM) (, a consortium of organizations that advocates for Congress to address the IOAS exception loophole. The group remains concerned about the ongoing misuse of the IOAS exception to the physician self-referral law. The loophole creates a conflict of interest, providing incentive for self-referral for profit, the results of which are obvious: increased spending, unnecessary use of medical services, and potentially compromised patient choice and care.


The American Physical Therapy Association, based in Alexandria, Virginia, represents more than 88,000 physical therapists, physical therapist assistants, and students of physical therapy nationwide. Learn more about conditions physical therapists can treat, and find a physical therapist in your area at Consumers are encouraged to follow us on Twitter (@moveforwardpt) and Facebook.

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