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Shenoy et al. Patient Safety in Surgery

(2022) 16:19

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physician [9, 10]. Table 1 tabulates the list of DHS cur rently applicable under the above law [7, 11]. An entity is referred to any person or entity that per formed DHS that are billed as DHS and those who billed DHS to Medicare or Medicaid for reimbursing a bill or claim [8]. A financial relationship is construed as one of the following four [8]: (1) an ownership interest, (2) an investment interest, or (3) a compensation arrangement between the physician (or a physician’s immediate family member) and the entity, and (4) a compensation arrange ment that may be either direct or indirect [8]. On the one hand, a direct financial relationship exists if remuneration passes between the referring physician (or a member of his or her immediate family) and the DHS furnishing entity without any intervening persons or entities in-between the above DHS entity and the refer ring physician (or a member of his or her immediate fam ily) [8]. On the other hand, an indirect ownership or invest ment interest exists when there is an unbroken chain of owners between the referring physician and the DHS entity, and the latter has actual knowledge of (or acts in reckless disregard or deliberate ignorance of) the fact that that the referring physician has some ownership or investment interest in the above entity [8]. The Stark Law has certain exceptions for financial rela tionships and/or arrangements [8]. The above law is not invoked when certain transactions fall within the purview of these exceptions. Table 2 tabulates the list of Stark Law exceptions [12]. Claims for DHS submitted in violation of the Stark Law triggers the following sanctions: denial of payment requiring amounts received to be refunded [8, 10], civil monetary penalties of $15,000 per service in which the violation is known [8, 10], and exclusion from Medicare

[3–6]. The intent of the above act was to contain and reg ulate self-referrals to reduce treatment costs for patients. Self-referral laws were, thereby, enacted to protect the patient’s best interest. The above laws safeguard that the patient receives the most efficacious treatment at an affordable cost. There were many reasons to enact and implement physician self-referral laws. Enacting and implementing physician self-referral laws is a necessary step in securing its regulation. The above laws, moreover, are perceived as instruments in curbing the overutiliza tion of healthcare services. The presence of self-referral laws, concurrently, appear to promote physicians’ better gauging the medical neces sity of a referral or service [3, 5]. The patient, thereby, benefits from eliminating expensive and unnecessary ser vices at entities in which they are treated [3]. Of the rea sons known for regulating self-referrals, a particular law contextual to physician self-referrals is the focus of this paper. The above law that selectively pertains to physician self-referrals is known as the Physician Self-Referral Law (or hereinafter, the Stark Law). The Centers for Medicare & Medicaid Services (CMS) specify the Stark Law stated in Sect. 1877 of the Social Security Act [7]. The said law: (1) prohibits a physician from making a referral for certain designated health services (DHS) payable by Medicare to an entity with which he or she (or an immediate family member) has a financial relationship, unless an exception applies and its requirements are satisfied [7], (2) prohibits the entity from filing claims with Medicare (or billing another indi vidual, entity, or third-party payer) for those referred DHS, and (3) establishes a number of specific exceptions and grants the Secretary the authority to create regula tory exceptions for financial relationships that do not pose a risk of program or patient abuse [7]. Core elements of the Stark Law The Stark Law has a set of well-defined seven core ele ments [8]. Those core elements are stated as follows: (1) physician, (2) referral, (3) designated health service(s) (DHS), (4) entity, (5) financial relationship, (6) excep tions, and (7) statutory penalties [8]. A physician means a doctor of medicine or osteopathy, dentist, podiatrist, optometrist, or chiropractor [8]. Providers such as nurse practitioners, physician’s assistants, and physical thera pists are not included within this definition [8]. A “referral” is the request by a physician for, the order ing of, or the certifying or recertifying of the need for, any DHS, including the request for a consultation with another physician and any test or procedure ordered by or to be performed by (or under the supervision of) that other physician [9, 10]. A “referral” does not include DHS personally performed or provided by the referring

Table 1 List of Designated Health Services

1 2 3 4 5 6 7 8 9

Clinical laboratory services, Physical therapy services, Occupational therapy services,

Outpatient speech-language pathology services, Radiology and certain other imaging services, Radiation therapy services and supplies, Durable medical equipment and supplies, Parenteral and enteral nutrients, equipment, and supplies, Prosthetics, orthotics, and prosthetic devices and supplies,

10 11 12

Home health services,

Outpatient prescription drugs, and

Inpatient and outpatient hospital services

Source: https://​www.​cms.​gov/​Medic​are/​Fraud-​and-​Abuse/​Physi​cianS​elfRe​ferral/​ List_​of_​Codes

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