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3 tips for providers to avoid Stark Law and Anti-Kickback Statute violations

On Behalf of | Jul 12, 2022 | Healthcare Law

Healthcare law is a complex niche area of the legal world. It is important for healthcare professionals to have at least a basic understanding of how these laws work and how they can affect your ability to practice in your chosen profession.

It is helpful to start with an understanding of two of the more common federal regulations, the Stark law and Anti-Kickback Statute, discussed in more detail below.

Tip #1: Know the difference between the two laws

One of the first steps to navigating compliance with these laws is understanding what they are. The Stark law, also known as the Physician Self-Referral Law, is a federal regulation that limits the ability of physicians to refer patients for various services. Lawmakers enacted this law to reduce the risk of physicians making referrals for their own financial gain. It generally prohibits the referral of patients to entities that are owned by the physician or their family members.

The Anti-Kickback Statute, or AKS, is broader, extending to all medical providers and services. It is applicable to any item or service that is paid by a federal healthcare program like Medicare or Medicaid.

Common examples of violations include the pharmaceutical company that takes physicians out for lavish meals or vacations in exchange for recommending their products or a physician who refers a patient to get lab work done at a lab owned by their spouse.

Tip #2: Know the loopholes

Technically referred to as safe harbors, these loopholes are areas where the government recognizes that a specific practice is not a questionable attempt to increase financial gain but an act that can truly help improve patient care.

Some examples that apply to allegations of a violation of the AKS can include:

  • Certain investment interests
  • Rental payments for facilities
  • Equipment rental fees
  • Sale of a medical practice

The United States Health and Human Services Office of the Inspector General explains that to qualify for a safe harbor the arrangement must meet “all of its requirements.” A word of caution for those who believe their actions may qualify: the requirements are expansive.

Tip #3: Know the penalties for a violation

Sometimes the best way to avoid a violation is to know what is at stake. When it comes to these two laws, the stakes are high. A violation of the Stark law can come with financial penalties as well as exclusion from Federal health care programs. The AKS can come with these same penalties, but more as it is a criminal law. This meaning that in addition to financial penalties the accused can also face the potential of prison time.