The Stark Law prohibits medical physicians from referring clients to other clinics or hospitals in which they have a financial interest.  This is a strict liability statute, meaning that there is no need to show that the physician acted intentionally or with knowledge in order to hold them liable.  Stark Law violations can sometimes form the basis for False Claims Act litigation

The Stark Law was created with the intention of preventing physicians from profiting off their own referrals.  Thus, the effect of the Stark Law is to prevent and reduce the occurrence of what is called “physician self-referral”.  Self-referral is thought to reduce the quality of health care and can lead to potential mistreatment and medical malpractice claims. 

What are the Penalties for Violating the Stark Law?

Penalties for violating the Stark Law involve fines similar to those for white collar crimes.  Stark Law violations will typically involve a fine imposed on the liable physician. 

Penalties can be very costly, and may include:

  • Payment of civil penalties (up to $100,000) for each violation instance
  • Refund of the money collected by the facility or physician that received the referral
  • Exclusion from Medicare or other state health care programs such as Medicaid
  • Payment of fines of up to $15,000 for each service provided that the person “knew or should have known” was provided through a Stark Law violation
  • Other penalties depending on the specific circumstances involved in the violation

Stark Law penalties can apply to both the physician that is making the illegal referrals, as well as the organization that received the referrals.  Penalties may increase if the parties knowingly act together to “circumvent” or avoid Stark Law requirements.

Do I Need a Lawyer for Assistance With Stark Law Provisions?

Stark Law violations can often be difficult to defend against since the law is a strict liability rule.  You may need to hire a qualified personal injury lawyer in your area if you need assistance with any matters involving the Stark Law.  Your attorney can provide you with legal guidance in the event that you need to make an appearance in court.  Or, if you need to report a Stark Law violation, a lawyer can provide assistance with your claim.