When structuring many common business romantic relationships involving healthcare providers, attorneys must be aware of the myriad of Federal and State laws which may be implicated because of this of the arrangement. The health treatment industry is greatly regulated with laws and regulations governing practices which may be entirely legal in other sectors but are limited or prohibited in the ongoing health care world.
This article will show a brief summary of the Federal Anti-kickback law, which may be implicated in many health care transactions. The focus of this article, however, is on the published Stark II Phase II Final Regulations recently, which applies to many common health care arrangements. 25,000, and obligatory exclusion from involvement in all Federal healthcare programs.
50,000 per violation and an assessment of not more than three (3) times the total amount of remuneration involved. Additionally, it may also exclude either party from participating in all Federal healthcare programs. On March 26, 2004, the Centers for Medicare and Medicaid (CMS) issued the long awaited Phase II final Stark Regulations.
In 1998, CMS first issued the proposed Stark II rules. CMS split the ultimate rule making process into two phases. Phase I was issued in 2001 leaving Phase II until now. In Phase II, CMS addresses the remarks received from Phase I making some revisions as well as providing fast rules on the provisions of the Stark II rules that had not been addressed. While Phase II provides higher flexibility, lawyers advising doctors and health care providers must keep in mind that they cannot ignore Stark as nearly every financial relationship between physicians and entities that furnish specified health services (DHS) implicate Stark.
Physicians and entities furnishing DHS must be in compliance with the new regulations by July 26, 2004. Violations of the law have substantial consequences for all those celebrations involved, of the intent of the celebrations irrespective. 15,000 for each claim submitted plus two times the reimbursement claimed), and exclusion from Medicare and Medicaid.
What Do The Mean for Physicians and Health Care Providers? Stark prohibits physicians from referring Medicare/Medicaid beneficiaries to an entity where they (or an immediate relative) has a financial romantic relationship for DHS. Many common financial romantic relationships can cause Stark, meaning the partnership must then meet an applicable Stark exception. Notably, Stark even applies to referrals of DHS within a group practice. For example, if a combined group practice provides services such as physical therapy, clinical lab, x-rays, and/or ultrasounds, within the practice, Stark shall be implicated. The prohibition is triggered Once, the partnership must then fall within a Stark exception.
The remainder of this article will summarize some of the shows of Phase II, which are of particular importance to attorneys structuring or advising doctors or healthcare clients in regards to their business transactions and financial romantic relationships. Phase II provides clarification and modifications as to how doctors can be compensated under the many exceptions for doctor compensation. These exceptions vary based upon whether the physicians are physicians in a mixed group practice, employees, or unbiased contractors.
Phase I of the rulemaking also created new regulatory exceptions for fair market value compensation paid to employees or indie contractors and payment for academic medical center physicians. In response to the Phase I rules, CMS received many comments regarding physician payment with a common theme that there should only be one set of conditions suitable to physician compensation.
In an effort to equalize the other areas of physician compensation, with respect to physician payment outside of the group practice context, Phase II models forth several modifications and clarifications in the rules and preamble commentary. Notwithstanding these attempts, caution should be taken when analyzing physician compensation as the specific terms and conditions of every exception continue to differ in some respects. Risk sharing payments made pursuant to participation in a physician incentive plan related to health plan enrollees. In response to Phase I, commenters also portrayed concern about the ability of physicians to receive productivity bonuses, outside of the mixed group practice/in-office ancillary context.