Physicians and other healthcare providers should keep a sharp eye on potential Stark law allegations amid increasing federal scrutiny, law firm Arnold & Porter wrote in an April blog post.
Here are 10 things to know about Stark law in 2024, pulled from the blog post and previous Becker's coverage:
1. The Department of Justice is doubling down on Stark law enforcement, with an increase in complaints-in-intervention and Stark-related settlements, which suggests "a likely uptick in Stark Law-based enforcement going forward," the report said.
2. Ownership interests and physician compensation arrangements, particularly when the compensation exceeds fair market value or varies with the volume of referral, are types of financial relationships that can trigger Stark law.
3. CMS settled a record-breaking total of $12.6 million in Stark law in 2023, a 552% increase from 2021.
4. Submitting claims that fall under Stark law violations could also qualify as false claims, which could fall under both the False Claims Act and the Anti-Kickback Statute. Unlike Stark law, Anti-Kickback Statute contains a heightened criminal scienter requirement, the report added, so oftentimes "Stark-based FCA claims require less proof than AKS-based FCA claims."
5. The DOJ's recent crackdown on Stark law features False Claims Act allegations that focus on Stark violations alone, according to the report. These include realtors who are the defendant, healthcare providers' corporate executives and allegations of physician compensation that exceed fair market value, according to the report.
6. "All of this suggests that Stark violations are an increasingly attractive target for the federal government’s healthcare fraud and abuse enforcers," the post said.
7. The law firm advises physicians carefully evaluate financial arrangements to ensure compliance amid this uptick.
8. "I have noticed that there are more and more arrests for Stark law violations," Lisa Knetsche, practice manager of The Spine Center of Central Kentucky in Danville, told Becker's. "It seems that they are targeting physicians. The systems are reducing pay, obstructing prior authorizations and then interfering in ways that physicians can earn money. It is simply another assault on physicians, as the Stark laws do not require intent. I think it is another factor running doctors toward no longer working in the medical field."
9. Last year, the most common trends in the Stark law cases included compensation above fair market value, compensation structures that changed with referrals, and the provision of services to physicians at reduced or no cost, according to a report from law firm Bass, Berry and Sims.
10. The most expensive penalty in 2023 involved Indianapolis-based Community Health Network, which agreed to pay $345 million to resolve claims it paid employed physicians above fair market value and that it awarded bonuses to physicians that were tied to referrals as part of a recruitment scheme.