The Stark Law, or The Physician Self-Referral Law, originally enacted in 1989, has recently seen a significant surge in enforcement attention. Both hospitals and health systems, as well as individual physicians, are feeling the heat as the penalties are continually increasing.
The law bans physicians from referring patients for specific “designated health services” payable by Medicare or Medicaid from entities in which the physician or their immediate family members have a financial relationship. Exceptions are rarely granted. These measures aim to ensure patients receive the optimal care available rather than the physicians obtaining any benefit for themselves, prioritizing patients over professional self-dealing.
The medical providers who suspect potential Stark Law violations are expected to report the possible infringements within six years, available through the self-referral disclosure protocol (SRDP). In light of this scenario, the period between 2021 and 2023 has seen the number of self-disclosures increase dramatically from 27 to 176.
One of the likely motivations for the increased self-disclosure could likely be due to the increasing size of Stark settlements. Community Health Network, Inc., of Indianapolis, settled an alleged violation of Stark laws with a payment of $345 million, marking one of the largest-ever Stark settlements.
However, while the heightened enforcement may be helping catch more violators, it is also believed to put ill-fitted pressures on physicians, aiding in distorting the patient care landscape. According to Dr. Harry Severance, MD, as private equity firms and management teams more business-oriented continue to gain control of American healthcare, the pressure to increase provider productivity and profitability ventures into the intolerable margins, impacting patient care in the process.
Dr. Severance, in his research, has found that primary care physicians would ideally require 26.7 hours per day merely to meet the nationally recommended guidelines for preventive care while also accommodating their patients. Dr. Severance indicates that this problem may be exacerbated without the presence of physicians on the board of directors, potentially making it easier to evade federal oversight and enquiry, especially when the situation is presented as ‘common business practice.’
See the originally published story on this topic at MedCity News: Stark Law Crackdown Jacks Up Fines, Settlements, And Physician Pressures.