What is self-referral, when is it allowed, and what safeguards apply under Stark law?

What is self-referral, when is it allowed, and what safeguards apply under Stark law?

• A. Referral by a physician to their own entity; allowed only if a Stark exception applies and arrangements meet criteria for legitimacy and FMV.
• B. Referral to any entity without limits.
• C. Referral to a non-medical service.
• D. Referral is always prohibited.

Answer: (A)

Self-referral under Stark law means a physician refers a patient to an entity with which the physician (or a close family member) has a financial relationship, for designated health services. This is generally prohibited to prevent improper financial incentives from influencing patient care. It becomes permissible only if the arrangement falls within a Stark exception and the terms are legitimate and commercially reasonable, with compensation at fair market value and not tied to the volume or value of referrals. In other words, a physician may refer to their own entity for designated health services only when the specific safe harbor requirements are met, ensuring the arrangement isn’t a sham designed to induce referrals. The other options miss the need for an applicable exception, the focus on designated health services, or the fact that Stark allows certain compliant arrangements rather than an absolute prohibition.

Self-referral under Stark law means a physician refers a patient to an entity with which the physician (or a close family member) has a financial relationship, for designated health services. This is generally prohibited to prevent improper financial incentives from influencing patient care. It becomes permissible only if the arrangement falls within a Stark exception and the terms are legitimate and commercially reasonable, with compensation at fair market value and not tied to the volume or value of referrals. In other words, a physician may refer to their own entity for designated health services only when the specific safe harbor requirements are met, ensuring the arrangement isn’t a sham designed to induce referrals. The other options miss the need for an applicable exception, the focus on designated health services, or the fact that Stark allows certain compliant arrangements rather than an absolute prohibition.