Can Physicians Violate The Stark Law By Accident?

Monday, October 8th, 2018
accidental stark law violation examples

There are two professions where it can be difficult to understand everything that’s said by industry professionals: the medical and legal fields. Understanding medical terms in the context of laws brings the two industries together. It can be easy for some physicians to get in trouble with the law accidentally when it comes to things like the Stark Law.

What is the Stark Law?

The Stark Law was put in place in 1992. It was intended to act as a way for the government to fight healthcare fraud and abuse. This law prohibits a physician (or their immediate family member) from making referrals for certain services to providers with which the physician (or their immediate family member) has a financial interest.

Physicians may be more likely to send patients to specific providers where they have a financial incentive to do so. This could result in doctors making referrals that cost the government extra money. This law is a civil law, rather than a criminal law, but has significant penalties associated with violations.

How can physicians accidentally violate Stark Law?

There are a number of different ways that physicians can violate the Stark Law by accident. The first is that they may enter into a deal with healthcare provider that is not well thought out. They may become involved with an arrangement where the payment to the physicians are based on the number of referrals or the profit of the referrals. Not properly tracking the ways that physicians receive compensation (both monetary and non-monetary) can cause this problem too.

Issues with documentation like technical errors, missing signatures, and expired contracts can result in violations of the Stark Law. Doctors may have agreements that have provisions required to meet an exception to the Stark law accidentally omitted. They may even conduct business without a written agreement at all. These are just some of the ways that a physician can breach the Stark Law by accident.

Penalties for violating the law

The Stark Law is a strict liability statute, which means the government does not have to prove that the parties intended to violate the law in order to prove a violation. As this is a civil law, the penalties are typically monetary. Penalties can be up to $15,000 for each billed service that was prohibited and up to three times the amount that the government overpaid based on the prohibited arrangement. These fees can have a severe impact on most physicians and practices. Physicians may be excluded from participation in federal health care programs as well.

How to protect yourself from violating the Stark Law

The best action that you can take if you are entering into a transaction that seems questionable is to speak with an experienced healthcare attorney. Talking to a legal professional before finalizing your deal can help you to avoid any accidental violations of the Stark Law.

The penalties for violations can have a significant impact on your practice. It makes sense to get preventative and responsive advice before moving forward. It can be beneficial to avoid these accidental issues by having your contracts and paperwork carefully audited.

Get help with the Stark Law from Brown & Fortunato, P.C.

If you are concerned about violating the Stark Law, contact the experts at Brown & Fortunato, P.C. today. Our Healthcare Attorneys can help you understand complicated laws and stay compliant in every area of your practice. To learn more about the Practice Areas we offer, you can call us at (833) 228-6300 or Contact Us by email. You can also visit our offices in person at 905 S. Fillmore St., Suite 400, in Amarillo, Texas.