Health Law

No More "Under Arrangements" Effective October 1, 2009

By Todd A. Rodriguez

In case you somehow missed the news, effective October 1, 2009 (that's right, tomorrow), 'under arrangements' ventures involving Stark services are no longer permissible.  An under arrangements venture usually involves provision of a diagnostic or therapeutic service on a turn-key basis by an outside supplier (often a physician office) on behalf of a hospital.  The hospital then bills for the service to Medicare as if the service was performed by the hospital pays the under arrangements provider a fee for performing the service.  In the 2009 Inpatient Prospective Payment System Regulations, CMS revised the definition of a designate health service "entity" for purpose of the Stark law to include not only the entity that submits the claim and receives payment from the Medicare program for the service (i.e., the hospital) but also the entity that performs the service (i.e., the under arrangements physician office).   As a result of this change, physician practice will, as of tomorrow, no longer be able to provide services under arrangements to hospitals to which they refer Medicare patients.   If for some reason you have not terminated or corrected any of your under arrangements contracts, you need to act quickly to avoid on-going Stark liability.  

Full post as published by Physician Law on September 30, 2009 (boomark / email).