Stark / Self-Referral

The federal Physician Self-Referral Statute, known as Stark law, prohibits entities from billing Medicare for certain “designated health services” referred by a physician (or immediate family member) who has a “financial relationship” with the entity, unless this relationship satisfies a Stark exception. Stark law also prohibits physicians from making such referrals. For purposes of Stark law, a financial relationship is an ownership or investment interest, or a compensation arrangement. Financial relationships may be direct or indirect. Stark law is a strict liability statute, meaning that an arrangement that involves Stark referrals will violate the statute unless it satisfies a Stark exception. 

Stark law has been implemented through a “phased” regulatory process occurring over a multi-year period, throughout which various Stark concepts have evolved and been amended. This has led to a complex regulatory framework that represents one of the greatest compliance challenges that health care providers face.  Our Healthcare Team has extensive experience in counseling health care providers, and in structuring provider arrangements and business models, for compliance with Stark law and analogous state laws.