![]() Otherwise, the law has broad coverage, is fairly complicated and complex, and seems to be in a fluid state. Notably, ambulatory surgery centers services are not considered designated health services, and are thus not covered by Stark regulations. Designated health services covered by the Stark law include: 1) clinical laboratory 2) physical therapy, occupational therapy, and speech-language pathology services 3) radiology and certain other imaging services (including magnetic resonance imaging, computerized axial tomography scans, ultrasound and nuclear medicine) 4) radiation therapy services and supplies 5) durable medical equipment and supplies 6) parental and enteral nutrients, equipment and supplies 7) prosthetics, orthotics, and prosthetic devices and supplies 8) home health services 9) outpatient prescription drugs and 10) all inpatient and outpatient hospital services. Generally speaking, the Stark law prohibits physicians from referring Medicare patients for certain “designated health services” to entities with which the physician (or an immediate family member of the physician) has a financial relationship, unless an exception applies. ![]() The second part, which will be posted next week, highlights common litigation themes and policy considerations related to required referrals. The first part discusses a general overview of the Stark law, its exception for “bona fide employees”, and how required referrals can comply with the Stark law. Thus, in the emergency context, the conditions may swallow the requirement. It seems, however, that timely care will most often be in the “patient’s best medical interests” when a non-employed physician is on call and ready to treat the presenting patient. In addition, a hospital may in theory “require” hospital-employed emergency room physicians to refer to hospital-employed physicians. However, for a hospital to require referrals, the physician must first be a “bona fide employee” and second, the “required referrals” must be in writing and subject to: 1) patient choice 2) third-party payer determination of provider and 3) the physician’s judgment regarding the patient’s best medical interests. The employment agreement between a physician and a hospital may include a requirement that the physician refer within the medical system. One question we have seen more and more hospitals ask is whether a hospital may insert a provision into its physician employment contracts requiring hospital-employed physicians to refer patients to other hospital-employed physicians without violating the Stark Law. When a hospital is putting together an employment contract with a physician, there are many items for both the hospital and the physician to consider.
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