Question

After working with counsel to modify Dr. Thompson’s lease, St. Vincent’s CEO suddenly needs a neurologist to practice at one of St. Vincent’s off-campus departments. The CEO only needs someone three days per week, and Dr. Thompson needs to pay off her medical school debt, so she agrees to fill the position. The CEO agrees to pay Dr. Thompson $37 ($39 per patient is the average in the area) for each patient she sees. The term is one year and six months and only applicable to services performed at the off-campus location. Dr. Thompson and the CEO ask counsel to write the contract, and then they both sign a written copy.

Does the agreement comply with the Stark Law?

If so, under what exception? What if the only evidence of an agreement was Dr. Thompson and the CEO’s handshake?

Answer 1

Stark law: It is a US Federal laws, in which a set of laws Prohibited specifically a referral by a physician (Physician Self-Referral) to Medicare or Medicaid patient to an entity providing DHS if the physician or any of her or his family member has a financial relation with that facility.

Referrals: From a physician only.

Items/Services: Designated Health Services.

Prohibition: Prohibits physician from referring a Medicare patients for Designated Health Services to an entity with which the physician or his family members have any financial relations.

So this agreement meet specified standards of the Stark Law.

Exceptions to Stark Law: Stark law refers only to direct health Services only and has many exceptions like: Including physician’s services, in-office ancillary services, bona fide employment relationships, rental of office space and equipment etc.