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Stark IV Regulations

The 2009 Hospital Inpatient Prospective Payment System Final Rule published on August 19, 2008 (pp. 48688-48745) makes some significant changes to the Stark regulations. A previous post discussed the changes to the stand-in-the-shoes regulations. This post discusses the new provisions in 42 CFR ยง 411.353(c) that provide guidance on defining the period of disallowance when referrals are prohibited due to a financial relationship between an entity and a physician that does not meet an exception.

Under these new provisions, if the noncompliance is unrelated to compensation, the financial relationship is brought into compliance on the date the relationship satisfies all requirements of an applicable exception. If the noncompliance is due to the payment of excess compensation, all excess compensation must be returned to end the period of disallowance. If noncompliance results from the payment of insufficient compensation, then all additional required compensation must be paid. Under this interpretation of the Stark law, a physician may not refer a Medicare patient to a hospital for a designated health service if the physician failed to pay additional rent owed to the hospital under a lease agreement until such additional rent was paid, even if the lease agreement had expired and the physician had vacated the space.

CMS will allow a compensation arrangement to meet an exception if the only missing element is a signature of one or more of the parties to an agreement that otherwise satisfies the requirements of the applicable exception and the signature is later obtained. If the failure to comply with the signature requirement was inadvertent, the parties have ninety (90) days from the date on which the arrangement became non-compliant to obtain the missing signature. If the failure to comply was not inadvertent, but knowing, the parties must obtain the required signature within thirty (30) calendar days following the date on which the compensation arrangement became noncompliant. Under other Medicare statutes, knowing means not only actual knowledge, but also reckless disregard or deliberate ignorance.

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This page contains a single entry from the blog posted on December 8, 2008 5:51 PM.

The previous post in this blog was New York City Moves Forward With New Cardiac Arrest Transport Protocol.

The next post in this blog is Share the wealth: NYSBA members comment on recent economic turmoil.

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