A Brief Overview of Stark Law – San Diego Health Care Attorney

Friendly Male and Female Doctors Isolated on a White Background.One of our firm’s primary practice areas is in healthcare law. In connection with our practice, we oftentimes get questions dealing with the Stark Law, one of most important statutes that physicians need to know.

The Stark Law is the statute that governs physician self-referral for Medicare patients. Physician self-referral is the practice of physicians referring patients to healthcare facilities in which they have financial interests. Stark Law was enacted in order to deal with the inherent conflict of interest.

In more exact terms, Stark prohibits a physician from making referrals for certain designated health services to an entity with which he or she, or an immediate family member, has a financial interest, with certain exceptions. When the law was enacted in 1989, the only designated health services were for clinical laboratory services. Now, however, there are many more designated health services, including, but not limited to, physical therapy services, occupational therapy services, radiology and certain other imaging services, durable medical equipment and supplies, home health services, and inpatient and outpatient hospital services. While Stark law primarily only applies to health services payable by Medicare, certain aspects of it now also apply to services payable by Medicaid.  That is, because Stark prohibits the use of federal funds to pay for services furnished to a Medicaid patient that would otherwise be considered improper referrals under Medicare, the law may prevent a state from receiving federal matching funds for those services.

A Stark Law analysis can essentially be in the form of four questions:

1. Does the arrangement involve a referral of a Medicare patient by a physician or immediate family member of a physician?
2. Is the referral for a designated health service?
3. Is there a financial relationship between the referring physician or family member and the entity receiving the referral?
4. Does the arrangement fall within an exception?

Our firm has experience analyzing arrangements to see whether they violate Stark. We have also read through numerous advisory opinions dealing with Stark issued by the Centers for Medicare and Medicaid Services. If you have questions regarding your own referral arrangement, we would be happy to render you our opinion as to any potential liability stemming from Stark. Please feel free to contact us at the VC Law Group via phone at (858) 519-7333 or email at info@thevclawgroup.com
 for more information.