In his introductory remarks to the Comprehensive Physician Ownership and Referral Act of 1993 (commonly known as the "Stark Law"), Congressman Fortney Stark stated that "the only way to protect health care consumers from unnecessary referrals is to impose a bright line rule." In order to accomplish this intent, Representative Stark introduced a law that is easy to describe but has been exceedingly difficult to implement. In fact, recent regulations that have attempted to provide the bright line clarity envisioned by Rep. Stark have actually created a unique challenge to hospitals and other entities that provide designated health services ("DHS") when amending a compensation arrangement with a physician.
The Stark Bill has two effects: First, the Stark Law prohibits a physician from making a referrals for certain "designated health services" payable by Medicare to an entity that the physician, or an immediate family member of the physician, has an investment interest in or a compensation arrangement with, unless the arrangement satisfies an exception that is described in the Act or in the regulations that have been promulgated to the Act. Secondly, the Stark Law prohibits the DHS entity from filing claims with Medicare for those referred services unless an exception applies.
...more to come.