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Four Things All Florida Physicians Should About the Stark Law


Named after its original sponsor, former U.S. Representative Pete Stark, the Stark Law is a set of federal regulations that are designed to prevent self-referral by physicians. More specifically, these laws apply to Medicare and Medicaid patients. All South Florida physicians should be aware of how Stark regulations could affect their medical practice. In this post, our experienced West Palm Beach physician practice lawyers highlight four important things that medical professionals need to know about the Stark Law.  

  1. The Definition of Self-Referral Under the Statute

For the purposes of the Stark Law, the term “referral” has a notably broad definition. Indeed, an action can be considered a referral if it is a request for goods or services on a Medicare or Medicaid plan that is made during or after a consultation. A physician may be guilty of making a self-referral if they send a covered patient to an outside entity, at which that physician, or their close family members, have any sort of financial interest or ownership stake. 

  1. The Medical Service Providers that are Covered

The Stark Law covers a wide variety of medical service providers. Practicing physicians are banned from making self referrals for any of the following services:

  • Laboratory tests and reports;
  • Radiology and other types of advanced imaging;
  • Occupational therapy;
  • Physical therapy;
  • Medical equipment and supplies;
  • Any type of outpatient care, including home healthcare; and
  • Medication and other prescription drugs.

As both direct and indirect financial interests are covered by the Stark Law, physicians need to take care when referring Medicare and Medicaid patients to any outside medical service providers.

  1. The Penalties for Stark Law Violations

The penalties for Stark Law violations can be severe. First and foremost, there could be denial of payment. Additionally, the violating physician may be hit with steep fines, personally or against their business practice. Civil penalties can reach up to $15,000 per each Stark Law offense. Finally, a physician who violates the Stark Law could temporarily or permanently by excluded from all U.S. federal healthcare programs. As the federal government has a massive role in healthcare payment, this could potentially destroy a physician’s practice. 

  1. The Exceptions

Over the years, the Stark Law regulations have been amended to include a number of different exceptions. For example, in some cases, referrals to related entities are permissible if the agreement only covers identifiable items, and if the payment is for the fair market value costs. If your practice is operating under this exception, or any other Stark Law exception, it is imperative that you consult with an qualified attorney who can ensure ensure that you are always in full compliance with federal regulations. 

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At Pike & Lustig, LLP, we have extensive experience representing healthcare providers in civil law matters, both in Florida state courts and in federal court. For immediate legal assistance, please do not hesitate to contact our team today to set up a free review of your case. From our main office in West Palm Beach and our second location in Miami, we represent physician practices throughout South Florida.



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