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The Stark Law and key considerations for physician employment agreements

One of the major fallouts of the passage of the Affordable Care Act (ACA) or Obamacare is the phenomenal rise in the number of physician practice acquisitions. These are some of the reasons for this rise:

-        Because of physician practice acquisitions, healthcare providers can consolidate and integrate their business better, since acquisition brings about alignment between the business prospects of the referral networks with the hospital’s strategic goals

 

-        The amendments brought about to the Medicare and Medicaid reimbursement systems of late have been pushing providers towards bundled and integrated payments, a practice that finds favor with hospitals with more physician practice acquisitions

 

-        With a noticeable decrease in the reimbursement rates of a few specialties, such specialists can feel secure by tying up with a bigger hospital brand. They not only get a little flexibility and bandwidth in negotiating contract rates; they are also assured of building a regular income stream, something for which they have to strive, sometimes indefinitely, in a private practice

 

-        Physician practices that are acquired by hospitals help experienced and new physicians alike. While experienced physicians see it as a means for supplementing their incomes; such hospitals usually allow younger physicians the freedom of working at times of their convenience, helping them to experience higher work life balance, something physicians of this age group look forward to earning.

Since physician practice acquisitions are an important factor in their professional lives; it is necessary for physicians to look into the finer aspects of agreements while negotiating them. They need to take into consideration not only the benefits and drawbacks and the suitability or inconvenience aspects of the acquisition; they also need to take major legislative and regulatory issues that govern physician practice acquisitions before they negotiate and sign physician practice acquisitions.

Enter, the Stark Law

The major federal law that deals with this aspect of healthcare practice is the Stark Law. Formally called The Physician Anti-Referral Law, or Stark II, the Stark Law is a very important law regarding physician referrals, whose provisions any healthcare provider which files claims has to comply with.

Noncompliance results in enforcement actions

The Stark Law is primarily aimed at ridding the healthcare sector of malpractices and is implemented in stages known as Stark II and Stark III. The highlight of the Stark Laws is that they deem certain physician actions as unlawful. When negotiating physician practice acquisition agreements, all the minute aspects of this law, including the few changes that were introduced into it in 2016, need to be taken into consideration.

Given the significant awards and settlements arising out of Stark Law enforcement actions; there is a heightened need for complying fully with the Stark Laws. As medical groups, hospitals, and health systems move towards integration and work out innovative hospital-physician arrangements; the need for putting in place compensation arrangements that are defensible under the Stark Law is undeniable.

Understand all the elements of the Stark Law

All the diligence and knowledge needed for drafting physician practice acquisitions in line with the provisions of the Stark Law, both from the hospitals’ and the physicians’ side, will be explained at a highly valuable webinar on this topic that is being organized by MentorHealth, a leading provider of professional trainings for the healthcare industry.

The speaker at this webinar, Joseph Wolfe, who is an attorney with Hall, Render, Killian, Heath & Lyman, P.C., the largest health care focused law firm in the country, offers advice and counsel to some of the nation's largest health systems, hospitals and medical groups on a variety of health care issues.

An understanding of the legally compliant physician practice acquisition agreements

At this webinar, he will explain the ways in which the contents of the Stark Law need to be understood and interpreted for drafting meaningful and legally compliant physician practice acquisition agreements. He will describe what factors need to be closely and carefully analyzed and scrutinized when working out physician practice acquisitions.

To gain the vital insights needed for understanding the nuances of the Stark Law and the other major legal considerations that need to go into physician practice acquisitions, please enroll for this webinar by visiting http://www.mentorhealth.com/control/w_product/~product_id=801023/?s...

In this session that is going to be of immense use to everyone connected with Stark Law and its implementation, namely professionals such as In-House Counsel, Healthcare Compliance Officers, Healthcare Human Resources, Healthcare CFO's, and other levels of healthcare executives, Joseph will cover the following areas:

  • Provide a general Stark Law overview
  • Examine critical components of Stark and Anti-Kickback compliant employment arrangements
  • Discuss best practices for drafting physician employment agreements, related compensation plans and facilitating effective onboarding
  • Discuss best practices for auditing existing employment arrangements
  • Describe alternative structures for organizations intending to qualify as Stark group practices.

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