Home > Legal Library > Article

Join Matindale-Hubbell Connected

CMS Settles Stark Violations for $584K

James A. Dietz
Dressman Benzinger LaVelle psc - Crestview Hills Office

March 26, 2013

Previously published by www.dbllaw.com on December 2012

The Centers for Medicaid and Medicare Services (CMS) has negotiated its fifteenth settlement under the Self-Referral Disclosure Protocol (SRDP) for a violation of the physician self-referral law (Start Law).

This latest settlement involves several Stark violations by a North Carolina general acute care hospital and its hospice facility.  The violations were settled for $584,700.

According to CMS, the hospital disclosed that it potentially violated Stark by failing to satisfy the requirements of the fair market value exception for the following:  (1) an arrangement with one physician; (2) arrangements with two physicians to provide medical director services; (3) the provision of leadership stipends to 13 physicians; and (4) failing to satisfy the personal services arrangement exception for an arrangement with a group practice to provide ophthalmology services.

On behalf of its hospice facility, the hospital disclosed that it may have violated Stark by failing to comply with the fair market value exception for arrangements with two physicians to provide hospice services.

The last SRDP settlement occurred in November and involved a California hospital's failure to satisfy the requirements of the "physician recruitment" exception to the Stark Law. CMS settled the violations with the hospital for $28,000.

Under the SRDP, providers may disclose actual or possible Stark law violations, for which the Secretary of HHS is authorized to reduce the penalties.  Settlement amounts have ranged anywhere from $60 for an Ohio physician group practice to $579,000 for an acute care hospital in Massachusetts.

According to a report HHS submitted to Congress in March 2012, CMS has received 150 disclosures from 148 providers since the SRDP implementation.  As of the date of the report, there are 51 disclosures still under review, and CMS was awaiting additional documentation for 61 additional disclosures.


The views expressed in this document are solely the views of the author and not Martindale-Hubbell. This document is intended for informational purposes only and is not legal advice or a substitute for consultation with a licensed legal professional in a particular case or circumstance.

View More Library Documents By...

Practice Area
Health Care
Dressman Benzinger LaVelle psc Overview