What is the Stark law?

Strict liability, not intent

Stark is violated by the structure of the arrangement, not by a bad motive. If the relationship exists and no exception applies, the referral is prohibited and the claim is not payable — whether or not anyone intended to profit improperly. That is what separates it from the Anti-Kickback Statute, which is a criminal law requiring intent and which reaches all payors, not just federal programmes.

Designated health services

Clinical laboratory services; physical and occupational therapy and outpatient speech-language pathology; radiology and other imaging; radiation therapy; durable medical equipment; parenteral and enteral nutrients; prosthetics and orthotics; home health; outpatient prescription drugs; and inpatient and outpatient hospital services.

How lawful arrangements are built

Through the exceptions — in-office ancillary services, bona fide employment, personal service arrangements, space and equipment rental, and others. Nearly all of them require the same discipline: a signed written agreement, a term of at least a year, compensation set in advance at fair market value, and payment that does not vary with the volume or value of referrals.

What a violation costs

Denied or refunded payments, civil monetary penalties, and exposure under the False Claims Act, where damages are trebled and per-claim penalties apply. Self-disclosure through the CMS protocol is the usual route once a problem is found, and legal advice before disclosure is the norm rather than the exception.