What is self referral

Physician Self-Referral (Stark II) Laws 

Since January 1995, the Social Security Act, Section 1877 (42 U.S.C. section 1395nn) prohibits physicians from making self-referrals for certain designated health services (DHS) involving the Medicare and Medicaid Programs. DHS includes the following items and services: 

* Clinical laboratory services 
* Physical therapy services Occupational therapy services 
* Radiology services 
* Radiation therapy services and supplies
* Durable medical equipment and supplies 
* Parenteral and enteral nutrients, equipment, and supplies 
* Prosthetic and orthotic devices and supplies 
* Home health services 
* Outpatient prescription drugs
* Inpatient/outpatient hospital services 

The law also prohibits a physician or his or her immediate family from having a financial relation- ship with an entity to which Medicare patients are referred to receive a designated health service. A financial relationship may exist in the form of an ownership, investment interest, or compensation arrangement.

Penalties for Violations of the Law 

The civil monetary penalty is a maximum of $15,000 for each service billed or furnished as the result of a prohibited referral. A total maximum penalty of $100,000 can be applied for each scheme to evade the requirement.

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