Stark Laws Research Articles

In-office magnetic resonance imaging (MRI) equipment ownership and MRI volume among medicare patients in orthopedic practices.

BackgroundConcerns have been raised about physician ownership of onsite advanced imaging equipment as allowed under Stark laws by the in-office ancillary service exception (IOASE).MethodsA web-based survey of orthopedic practices in the United States was used to assign a first date of onsite MRI capacity acquisition (if any) to specific orthopedic practices. Medicare claims data for 2006–2010 was obtained for providers in orthopedic practices acquiring onsite MRI capacity and in matched orthopedic practices without an onsite MRI over the same period of time. Multivariate regression was used to estimate the change in provider Medicare MRI volume one year before and one year after the onsite MRI acquisition year for providers in MRI practices compared to providers in propensity-score matched non-MRI practices.ResultsIn all of the MRI volume change models estimated, the association between onsite MRI acquisition and the change in provider Medicare MRI volume (one-year post-onsite-MRI-acquisition less one year pre-acquisition) was consistently small and not statistically significant. This lack of association was robust to changes in model specification in terms of types of MRI exams considered, specific covariates included in the multivariate model, or the process used to confirm individual provider affiliation with study practices in study years.ConclusionsOur analysis of Medicare claims data provides no empirical support for the proposition that acquisition of onsite MRI capacity within an orthopedic surgery practice induces an increase in the rate of MRI use for Medicare patients among practice providers, relative to physicians in practices without MRI capacity over the same time period.

Improving Value in Healthcare

Improving Value in Healthcare

The Road Ahead

The Road Ahead

Unintended Consequences of Health Care Legislation

Unintended consequences of health care legislation threaten the financial and social well-being of the United States. Examples of major legislation resulting in unintended and unforeseen consequences include the Social Security Amendments Acts of 1989 and 1993 (the Stark laws), the Balanced Budget Act of 1997, and the Social Security Amendments Act of 1965 (Medicare and Medicaid). Each of these has had unintended financial and social outcomes. Spending for Medicare and Medicaid now equals an unsustainable 23% of the federal budget. Major reasons for unintended consequences include failure to appreciate the complexity of the issues, the open-ended nature of medical advances with attendant increases in costs, the inducement of change in behaviors in response to legislation, and the moral hazard of people spending other people's money. Actions that should be considered to avoid unintended consequences include more involvement of health professionals in the design of legislation, the inclusion of triggers to target review of legislatively defined programs, and the setting of time limits for sun-setting legislation. The ACR has played an important advocacy role and should continue to offer input to legislators, federal policymakers, and other stakeholders. Many opportunities exist to address the current financial situation by reducing the amount of unnecessary care delivered. Both major US political parties need to find the political will to compromise to chart the way forward. Some level of sacrifice is likely to be necessary from patients and providers and other stakeholders.

Key legal issues facing U.S. endoscopy centers

Ambulatory surgery centers remain strong sites for physician services in the outpatient setting. The relationship between endoscopists and surgery centers can be complex from a financial and legal standpoint. The interpretation of Stark and Anti-Kickback laws is a dynamic target, constantly being sifted by legal minds, and is the topic of review in this chapter. Other important issues are reviewed within the context of current interpretation and analysis.

The Effect of Self-Referral on Utilization of Advanced Diagnostic Imaging

This article reviews the evidence on the relationship between recent increases in utilization of diagnostic imaging and self-referral. The evidence shows that self-referral invariably leads to higher utilization and the attendant higher costs. Because most physicians do not own advanced imaging equipment, their own best interests are being thwarted by the practice of self-referral. Congress and the Centers for Medicare and Medicaid Services should restrict the in-office ancillary services exception to the Stark laws as it applies to advanced imaging.

Physician-Owned Distributors: The Wave of the Future or the End of the Model?

New business entities called physician-owned distributors (PODs) have sprung up around the country. PODs are business entities that enhance the income of physicians who are investors via the recovery of money paid out for the implantation of medical devices in their patients. There have been a varying opinions among attorney groups and the Office of Inspector General as to their legality and what may constitute a legal entity. The legal opinion of attorneys employed by the major implant companies is that the PODs are illegal, whereas the legal opinion of those physicians setting up a POD is that the PODs are legal when properly and "legally" constructed. The Office of Inspector General has been watching these businesses as possible violations of the Stark Laws and kickbacks being paid out to the physician owners in the PODs. Some hospital groups have been prohibiting PODs from doing business in their hospitals because of fear of the excessive use of implants and possible kickback violations. These are confusing issues and as of this time there is no clear and concise model that can be considered legal, yet the PODs persist and are becoming more prevalent.

Job Offers From Hospitals: Sorting Out Stark Issues

The Stark laws govern the rules under which physicians may make referrals to a designated health service paid for by Medicare; if the physician has a direct or indirect financial relationship with a service, then that physician is prohibited from making a referral to that entity. There are exceptions. Before contracting with hospitals for their services, physicians need to be aware of the legal ramifications.

Why the In-Office Ancillary Services Exception to the Stark Laws Needs to Be Changed—And Why Most Physicians (Not Just Radiologists) Should Support That Change

The in-office ancillary services exception (IOASE) to the federal Stark laws is by now familiar to many radiologists, but not all. The laws were originally designed to prevent physicians from profiting financially by referring patients for “designated health services” to facilities in which they or family members had financial interest. Imaging services are included within the category of designated health services. Although the concept seems simple and reasonable enough, the Stark laws are quite complicated.

Turf Wars In Radiology: Recent Actions Against Self-Referral by State Governments, Commercial Payers, and Medicare—Hope Is on the Horizon

Self-referral in imaging creates a problem for our health care system in that it leads to higher utilization and costs. Although it is still widespread, there are indications that some states, some regional payers, and the Centers for Medicare & Medicaid Services have begun to take some actions to limit this potentially abusive practice. At the state level, these actions include consideration of anti-self-referral laws, crackdowns on scan-leasing schemes, the institution of mandatory facility accreditation programs, and bans on the installation of advanced imaging equipment in physician offices. Some commercial payers have instituted strict privileging programs in imaging, closed their panels to any facility that is not a full-service imaging provider, and begun requiring accreditation of advanced imaging modalities. The Centers for Medicare & Medicaid Services plans to institute an antimarkup rule and prohibit independent diagnostic testing facilities from leasing space or equipment to nonradiologist physicians, and it has indicated that tightening up the loopholes in the Stark laws may be in the offing. In this paper, the authors review all these recent developments and their implications.

Physician Refer Thyself: Is Stark II, Phase III the Final Voyage?

The United States spends more of its wealth on healthcare than any other developed country, and that share is rising. Supporters of the free market system point to the regulatory burden on the healthcare industry. Estimates of the regulatory costs of US healthcare range from dollars 58 billion to dollars 339 billion. A recent report indicates that approximately dollars 8 billion of the US healthcare budget of dollars 1.9 trillion is spent on physicians' extra income derived from their ownership in outpatient facilities, such as ambulatory surgery centers, diagnostic imaging centers, and diagnostic testing and procedure laboratories. It is essential for an interventionalist to understand fraud and abuse, self-referrals, and the implications of the Stark law and anti-kickback statutes, among a maze of other regulations. It is important for interventionalists to understand and also be able to invest in protected and approved investments and also be involved in business dealings which are within the law. Various reasons include: decreasing reimbursements by Medicare, Medicaid, managed care, and all other third-party payors; increased competition in providing interventional pain management; increasing costs of overhead and doing business; the popularity of interventional pain management, leading each and every pain physician to want to provide the service; concerns in multiple settings, including offices, ambulatory surgery centers (ASCs), hospitals, private practices, and academic settings; and finally, the failure to develop strategies to remove oneself from questionable investments and business associations. Self-referrals occur when physicians refer to medical facilities in which they have financial interest. Multiple concerns related to self-referral, including conflict of interest and increased costs to the Medicare program, resulted in a ban on self-referral arrangements for clinical laboratory services under the Medicare program in 1989 known as Stark I. In 1993, the Stark I prohibition on self-referrals by physicians expanded to include 10 additional healthcare services known as designated health services or DHS. The 1993 expansion of Stark I was enacted in 1995 as Stark II. In 2007, CMS adopted Phase III of the regulations interpreting Stark II. Phase III made multiple changes and clarified many previous issues, and it becomes effective December 4, 2007. While it is mandatory to obtain expert legal advice and this manuscript in no way provides the extensive navigation required through the maze of Stark laws and other anti-kickback statutes, it is incumbent on interventionalists in all settings of practice to have appropriate knowledge of the Stark laws and exceptions and of the anti-kickback statute and safe harbors. Penalties for violating the Stark laws are severe, including fines of up to dollars 15,000 per service and the economic threat of exclusion from participation in federal healthcare programs, which may result in exclusion of any type of healthcare program and loss of privileges at hospitals and surgery centers. This manuscript reviews physician practices in general, physician payments, and self-referral patterns in particular, the evolution of the Stark law and regulations and its implications for physician practices. This article is not, and should not be, construed as legal advice or an opinion on specific situations.

Physicians, Payments, and Practices: Moral Issues, Public Perceptions, and the Stark Laws

Physicians, Payments, and Practices: Moral Issues, Public Perceptions, and the Stark Laws

Reimbursement, Practice Management Issues, and Ethics

In the day-to-day life of an audiologist, he or she may not always consciously consider the laws that must be abided to function in a productive and ethical manner. The Medicare/ Medicaid Anti-Kickback Statute, Stark Laws, and Health Information Portability and Accountability Act are discussed in this article as well as suggestions for optimizing chart documentation, strategies for legally dismissing a patient, protocols for referring to another audiologist, and recommendations for coding appropriately.

Physician-Owned Companies

The author relates his experience in the development of a spinal implant development company (K2M) that is significantly advised by physicians. To provide information about the development of a spinal implant company (K2M) advised by a group of professional spinal surgeons. To relate the federal laws (STARK and anti-kickback) as they pertain to surgeon-influenced companies. To discuss the role of a scientific advisory board. A self-developed company was developed together with significant, but minority physician financial input and majority scientific advice. A privately owned spinal implant development corporation (K2M) was developed 3 years ago. Physician financial participation was less than 20% (Stark laws state no more than 40%). Users of product are greater than 60% non-investor physicians. The development of a large scientific advisory board has been very influential in product development. A privately owned spinal implant company (K2M) has been developed strictly within Federal laws. Its board of scientific advisors that receives recompense commissurate only with effort significantly impacts the company policy.

Durable Medical Equipment

Recent changes in the interpretation of the Stark laws have made it legal and advantageous for physicians to dispense and bill directly for durable medical equipment (DME). Previously, physicians either gave small braces and splints to their patients as part of the services or wrote prescriptions for the larger and more expensive items. This resulted in inconvenience to the patient as they were required to travel to another location for the fitting of the brace or splint and there was often a significant expense to the patient or insurance company. More recently the "stock and bill" business arrangement became common. These arrangements were more convenient for the patient but did nothing to control costs. Since physicians may now dispense DME directly to the patient, DME becomes a part of the "complete services" that is becoming the model for patient-centered care. In addition, physicians have more control over the fitting of the devices and have an opportunity to control the pricing. This article provides instructions for the implementation of an office DME program that can be beneficial to both patient and physician.

Exceptions to the Stark Law: Practical Considerations for Surgeons

The purpose of this study was to provide an understanding of the applicable legislative exceptions to prohibitions under the Stark law, which governs common legitimate business relationships in surgical practice. Stark I and II prohibits all referrals (and claims) for the provision of designated health services for federal reimbursement if a physician or immediate family member has any financial relationship with the entity. Regardless of intent (unlike the antikickback statute), any financial relationship is illegal unless specifically excepted by statute. These exceptions are relevant to ownership, compensation arrangements, or both. The most important ones relevant to surgeons are as follows: physician service exception (services rendered in an intragroup referral); in-office ancillary services exception (office-based vascular laboratory); the whole hospital exception (ownership interest in a hospital or department); lease exception (conditions that must be met for a lease not to be considered illegal); bona fide employment exception (important to academic medical centers); personal services arrangement exception (vascular laboratory medical directorship); physician incentive plans exception (if volume or value of referrals are an issue); hospital-affiliated group practice exception (physician services billed by a hospital); recruitment arrangement exception (inducements by hospitals to relocate); items/services exception (transcription services purchased from a hospital); fair market value exception (covers services provided to health care entities); indirect compensation arrangements (dealings between a hospital and entity owned by physicians); and academic medical centers exception (new phase II rules broaden the definition of academic medical centers and ease the requirement that practice plans be tax-exempt organizations, among other changes. Although expert legal advice is required for navigation through the maze of Stark laws, it is incumbent on surgeons in private practice and at academic centers to have basic knowledge of exceptions under this burdensome statute. Antikickback "safe harbors" provide some protection against possible Stark violations. Penalties for violating Stark laws are severe, including fines of up to $15,000 per service and the economic threat of exclusion from participation in federal health care programs.

Overview of physician-hospital ventures

An ongoing environment of reimbursement lagging behind escalating expenses has led physicians to explore new sources of revenue. The goal of physician-hospital ventures is to create a valuable entity that benefits patients, physicians, and the hospital. Physicians may choose to invest in healthcare facilities to improve patient care and obtain increased control over daily operations. If so, they should seek counsel to avoid violating Stark laws and anti-kickback laws. Modalities for investing in physician-hospital ventures are joint equity (stock) ventures, participating bond transactions (PBTs), and contractual integration, a new method to align the goals of specialists and hospital management without using joint equity ventures. Physicians and management should invest time in developing a shared vision of the future before beginning contract negotiations. Successful partnering requires transparency and stepwise building of trust. The greatest gain in joint ventures arises when both sides become active owners, rather than passive investors.

Stark Laws, Safe Harbor Regulations, and Anti-kickback Statutes

Stark Laws, Safe Harbor Regulations, and Anti-kickback Statutes

Professionalism and Conflict of Interest

You have accessThe ASHA LeaderMake it Work1 Aug 2003Professionalism and Conflict of Interest Allan O. Diefendorf Allan O. Diefendorf Google Scholar More articles by this author https://doi.org/10.1044/leader.MIW.08142003.25 SectionsAbout ToolsAdd to favorites ShareFacebookTwitterLinked In One of the most important assets of an audiologist is reputation in the community he or she serves. This reputation is based not only upon the quality of care provided to patients, but also upon the community’s perception of the integrity of the audiologist’s business operations. Therefore, a guiding principle for audiologists is that they shall avoid personal interests that conflict with the best interest of the patients they serve. That is, when potential for conflict of interest exists, the interests of the patient must come before those of the audiologist. A conflict of interest may exist when an audiologist or immediate family member engages in business practices or relationships that provide the audiologist with financial incentives. This involvement could result in a loss of objectivity and may affect how services are delivered to a patient who is seeking care and recommendations from the audiologist. Moreover, although the appearance of a conflict of interest may not actually be a legal or ethical violation, appearances can damage the reputation of an individual, his or her practice, and profession. In ASHA’s Code of Ethics, Principle of Ethics III advocates, “Individuals shall honor their responsibility to the public by promoting public understanding of the professions, by supporting the development of services designed to fulfill the unmet needs of the public, and by providing accurate information in all communications involving any aspect of the professions.” Rule of Ethics III-B states, “Individuals shall not participate in professional activities that constitute a conflict of interest.” As the profession of audiology has continued to evolve, product dispensing has become a significant part of service delivery. Increasingly, alliances between audiologists and hearing instrument manufacturers have become a significant factor in service delivery. As such, professionals are faced with decisions that may result in ethical dilemmas between their patient’s best interest and their own financial interests. As these relationships become more common and complex, there are more and more possibilities for conflicts of interest. Examples of potential conflicts of interest include, but are not limited to, any investment, financial interest, or commercial interest in a company with which an audiologist does business; any employment or consulting with a company with which an audiologist does business, without disclosing the relationship to a patient; accepting gifts, material goods, entertainment, incentive travel, or education expenses from a company with which an audiologist does business; and participating in any industry-sponsored social functions that give rise to the appearance of biasing or influencing professional judgment or practice. Health care professionals are distinguished by the type of services they provide to the public and for complying with strict legal regulations and ethical guidelines regarding reimbursement. As audiologists achieve greater autonomy, receive more third-party payment, and gain more direct access to Medicare reimbursement, our business practices will receive greater scrutiny by the public. As such, audiologists will be held accountable to the same anti-kickback prohibitions and federal laws (Stark Laws) that prohibit physicians from referring patients to an entity for the furnishing of services if the physician or an immediate family member has a direct or indirect financial interest in the entity providing such services. Doctoring professions, to which audiology aspires to become, assume similar values, attitudes, and beliefs concerning patient care. Serving patients’ interests is the first and primary mission, and this mission must always come before personal financial interests. And conflicts of interest, even if by appearance only, must be eliminated entirely from the professional’s practice. Author Notes Allan O. Diefendorf, directs audiology and speech-language pathology at the Indiana University Medical Center. He is on the faculties of the department of otolaryngology, head & neck surgery at the Indiana University School of Medicine, and the department of audiology and speech sciences at Purdue University. Contact him by e-mail at [email protected]. Additional Resources FiguresSourcesRelatedDetails Volume 8Issue 14August 2003 Get Permissions Add to your Mendeley library History Published in print: Aug 1, 2003 Metrics Downloaded 848 times Topicsasha-topicsleader_do_tagleader-topicsasha-article-typesCopyright & Permissions© 2003 American Speech-Language-Hearing AssociationLoading ...

Practice management: Update on coding, ancillary services, and the New Stark Laws

As an introduction, first let us legitimize the inclusion of information on coding and reimbursement in our association’s periodic publication. Arthroscopy is first and foremost an educational tool for the Arthroscopy Association of North America (AANA) and its members. Coding has become one the most challenging parts of our daily practice. Keeping pace with the many changes in surgical and evaluation and management coding requires both interest and diligence. Coding has become an area of intense interest and is mandatory for inclusion into our educational programs. Second, coding has become synonymous with reimbursement. Our ability to effectively and efficiently care for patients is dependent on our success as business people. The safe and satisfactory execution of patient care requires many medical and nonmedical personnel. Recruitment and maintenance of these health care professionals is costly. And last, incorrect coding places us in personal and professional jeopardy. The Center for Medicare and Medicaid Services (CMS) formerly the Health Care Finance Administration (HCFA) has made the investigation and prosecution of Medicare fraud an obvious priority. This reality propels coding into a new and heightened level of importance.