The Stark law is a federal law, which was named after Pete Stark, a former congressman that created the law to prohibit physicians or doctors from referring patients to institutions where the doctors have a financial gain or relationship. The patients, however, must be Medicare patients. The relationship addressed, in this case, implies any financial relationship as a consequence of ownership or whether the doctor acquires financial compensation from referring the patient to the institution. The same law can also be examined under the physician referral law, which is stipulated in the Social Security Act, section 1877.
Management Responsibility and Violation Consequences In cases involving violation of the Stark laws, the penalties involve a denial of payment for the designated health service (DHS) or the
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The kickbacks were in the form of on-call cash payments, free office space and paid trips to the Masters Golf Tournament. The expenses from these actions were later submitted as Medicare claims where the hospital would reap further benefits. The claims did not hold in court especially because there was no relationship between the hospital staff and the hospital. A parent company does not fall into the same category as the hospital. Therefore, the claim did not show how the hospital directly went against anti-kickback laws as stipulated in the laws. From a personal examination of the claim, the ruling of the case was not satisfactory because an examination of the actions undertaken by the parent company would have proved that physicians were still accepting kickbacks. The laws should be amended to include all actions undertaken by the parent or subsidiary companies. The strict nature of the law will reduce cases involving