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Stark Law Lawyers

The Stark Law governs physician self-referral for Medicare and Medicaid patients. The law is named for U.S. Congressman Pete Stark, who sponsored the initial bill. Specifically, the Stark Statute, 42 U.S.C. § 1395nn, prohibits a physician from referring Medicare patients for specific services (“designated health services” or DHS) to entities with which they or an immediate family member have a “financial relationship.” Stark I. enacted in 1989, only applied to physicians referrals for clinical laboratories. In 1993, Congress extensively revised the Stark Law, expanding the referral and billing prohibitions to cover additional types of designated health services. This legislation is also known as Stark II. The law defines a physician as a doctor of medicine or osteopathy, a doctor of dental surgery or dental medicine, a doctor of podiatric medicine, a doctor of optometry, or a chiropractor. Under the Stark Law, if a financial relationship exists between the physician and the DHS, the physician is precluded from referring patients to the entity for DHS, and the entity is precluded from making a claim for payment under the Medicare program for any such referred DHS unless the arrangement falls within an exception.

Stark Law penalties include:

  • A civil monetary payment of $15,000 for each service
  • A $100,000 civil monetary penalty for each arrangement considered to be a circumvention scheme
  • Exclusion from participation in federal health care programs
In addition to being subject to a civil monetary penalty for violating Stark Laws, a physician or billing entity may be subject to a civil suit under the False Claims Act.  The following are designated health services under the Stark Law:
  • Clinical laboratory services
  • Physical therapy services
  • Occupational therapy and speech-language pathology services
  • Radiology services, including MRI, CAT scans, and ultrasound services
  • Radiation therapy services and supplies
  • Durable medical equipment and supplies
  • Parenteral and enteral nutrients, equipment and supplies
  • Prosthetics, orthotics, and prosthetic devices and supplies
  • Home health services
  • Outpatient prescription drugs
  • Inpatient and outpatient hospitalization services
  • Nuclear medicine will be considered a DHS beginning in 2007
Other arrangements that may implicate the Stark Law:
  • All space and equipment leases
  • Marketing agreements
  • Below fair market value agreement between providers and suppliers
  • Hospital, Nursing home and other facilities cost report certifications
  • Wavier of co-payments and deductibles
  • A drug companies failure to report the their best price for drugs to federal payors
  • All Physician employment and independent contractor arrangements
  • Office sharing agreements and time-sharing arrangements
If you have knowledge of a physician or billing entity that has violated the Stark Law, call the attorneys of Belt & Bruner for a free confidential consultation. Our Alabama personal injury attorneys are ready to provide the one on one attention you need and deserve. For your free stark law consultation with an Alabama Stark Law Attorney fill out our contact form or call us (toll free).