Self-Referral Laws
Legal Defense for Self-Referral Law Violations
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When can physicians refer patients to an entity in which he or she has a financial interest? May a physician refer patients to an X-ray facility the physician partly owns? Can surgeons make money on physical therapy referrals? When can physicians benefit from their referrals?
The answer? It depends. State laws vary in the application of referral laws. Arizona’s self-referral law applies only to medical doctors and surgeons. California’s Stark laws include all healing arts. Another common distinction is the type of service or activity performed. Montana’s self-referral law prohibits medical professionals from owning pharmacies. Montana does not, however, bar physicians from owning surgery centers, implant companies, or clinical labs.
Designated health services (DHS) include:
- Clinical lab services,
- Physical and occupational therapy,
- Radiology services,
- Durable medical equipment and supplies,
- Orthotics and prosthetic devices and supplies,
- Home health services,
- Outpatient prescription drugs,
- Inpatient and outpatient hospital services.
A “financial relationship” is a direct or indirect ownership, investment interest in, or payment arrangement with a DHS entity. A “direct” financial relationship exists if rewards pass between a referring physician and the DHS with no involvement of other persons or entities. An “indirect” financial relationship is the same, but with intervention from one or more entities. Relationships include receiving a salary, royalty, consulting fee, ownership interest, or other benefit.
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Three types of self-referral standards can be distinguished.
Category 1
No or very minor state law prohibition against physician self-referrals.
Representative States:
- Alabama
- Arkansas
- Nebraska
Category 2
Some restrictions, but overall similar to federal law.
Representative States:
- Georgia
- Louisiana
- Texas
Category 3
Strong restrictions.
Representative States:
- California
- New Jersey
- Nevada
Expert knowledge of the subject helps both physician and business partner target states with the fewest restrictions. The attorneys of Oberheiden, P.C. advise physicians and healthcare companies across the country to find solutions to self-referral concerns.
Put our highly experienced team on your side
Our Proven Self-Referral Analysis Includes:
- The exact parameters of self-referral restrictions
- Proven loopholes without circumventing the law
- Proper documentation to protect all parties
- Professional disclosure protocols to facility and patients
Oberheiden, P.C. has the experience and success rate to guide you and your company through healthcare investigations. Contact us today.