Bricker & Eckler LLP: Comparison Chart of Anti-Kickback Safe Harbors and Stark Exceptions - Part 4

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STARK LAW EXCEPTIONS AND ANTI-KICKBACK LAW SAFE HARBORS

Joint Ventures in Underserved Areas

Stark [No comparable exception]	Anti-Kickback Safe harbor for payments that constitute return on an investment interest, such as dividend or interest income, made to an investor in an entity that possesses investment interests that are held by either active or passive investors
	No more than 50% of the value of the investment interests of each class of investments may be held in the previous fiscal year or previous 12 month period by investors who are in a position to make or influence referrals to, furnish items or services to, or otherwise generate business for the entity.
	The terms on which an investment interest is offered to a passive investor, if any, who is in a position to make or influence referrals to, furnish items or services to, or otherwise generate business for the entity must be no different from the terms offered to other passive investors.
	The terms on which an investment interest is offered to an investor who is in a position to make or influence referrals to or generate business for the entity must not be related to the previous or expected volume of referrals, or the amount of business generated from the investor to the entity.
	Passive investors are not be required to either make referrals to, or otherwise generate business for the entity as a condition for remaining as an investor.
	The entity or any investor must not market or furnish the entity's items or services to passive investors differently than to non-investors.
	At least 75% of the dollar volume of the entity's business in the previous fiscal year or previous 12 month period must be derived from the service of persons who reside in an underserved area or are members of medically underserved populations.
	The entity or any investor must not loan funds to or guarantee a loan for any investor who is in a position to make or influence referrals to or generate business for the entity if the investor uses any part of the loan to obtain the investment interest.
	The amount of the payment to an investor in return for the investment must be directly proportional to the amount of the capital investment.

Isolated Transactions

Stark Stark exception to the referral prohibition related to compensation arrangements for isolated financial transactions with a physician, such as a one-time sale of property or a practice	Anti-Kickback [No comparable safe harbor]
The amount of the remuneration under the transaction is consistent with the fair market value of the services.
The amount of remuneration under the transaction is not determined in a manner that takes into account (directly or indirectly) the volume or value of any referrals by the referring physician or other business generated between the parties.
The remuneration is provided under an agreement that would be commercially reasonable even if the physician made no referrals.
There are no additional transactions between the parties for 6 months after the isolated transaction, except for transactions which are specifically excepted under the other provisions of the Stark regulations and except for commercially reasonable post- closing adjustments that do not take into account (directly or indirectly) the volume or value of referrals or other business generated by the referring physician.

Equipment Leases

Stark Stark exception to the referral prohibition related to compensation arrangements for rental of equipment between an entity and a referring physician	Anti-Kickback Safe harbor for payments made by a lessee to a lessor for the use of equipment
A rental or lease agreement is set out in writing and signed by the parties and specifies the equipment covered by the lease.	The lease agreement is set out in writing and signed by the parties.
The equipment rented or leased does not exceed that which is reasonable and necessary for the legitimate business purposes of the lease or rental and is used exclusively by the lessee when being used by the lessee and is not shared with or used by the lessor or any person or entity related to the lessor.	The lease covers all of the equipment leased between the parties for the term of the lease and specifies the equipment covered by the lease.
The lease provides for a term of rental or lease of at least 1 year. If the agreement is terminated during the term with or without cause, the parties may not enter into a new agreement during the first year of the original term of the agreement. A holdover month-to-month rental for up to 6 months immediately following an agreement of at least 1 year will satisfy this paragraph, provided the holdover rental is on the same terms and conditions as the immediately preceding agreement.	If the lease is intended to provide the lessee with use of the equipment for periodic intervals of time, rather than on a full-time basis for the term of the lease, the lease specifies exactly the schedule of such intervals, their precise length, and the exact rent for such interval.
The rental charges over the term of the agreement are set in advance, are consistent with fair market value, and are not determined— (i) In a manner that takes into account the volume or value of any referrals or other business generated between the parties; or (ii) Using a formula based on— (A) A percentage of the revenue raised, earned, billed, collected, or otherwise attributable to the services performed on or business generated by the use of the equipment; or (B) Per-unit of service rental charges, to the extent that such charges reflect services provided to patients referred between the parties.	The term of the lease is for not less than one year.
The lease would be commercially reasonable even if no referrals were made between the parties.	The aggregate rental charge is set in advance, is consistent with fair market value in arms-length transactions and is not determined in a manner that takes into account the volume or value of any referrals or business otherwise generated between the parties for which payment may be made in whole or in part under Medicare or a State health care program.
	The aggregate equipment rental does not exceed that which is reasonably necessary to accomplish the commercially reasonable business purpose of the rental.
	The term fair market value means the value of the equipment when obtained from a manufacturer or professional distributor, but shall not be adjusted to reflect the additional value one party (either the prospective lessee or lessor) would attribute to the equipment as a result of its proximity or convenience to sources of referrals or business otherwise generated for which payment may be made in whole or in part under Medicare or a State health care program.

Space Leases

Stark Stark exception to the referral prohibition related to compensation arrangements for rental of office space between an entity and a referring physician	Anti-Kickback Safe harbor for payments made by a lessee to a lessor for the use of space
The agreement is set out in writing, is signed by the parties, and specifies the premises it covers.	The lease agreement is set out in writing and signed by the parties.
The term of the agreement is at least 1 year. To meet this requirement, if the agreement is terminated during the term with or without cause, the parties may not enter into a new agreement during the first year of the original term of the agreement. A holdover month-to-month rental for up to 6 months immediately following an agreement of at least 1 year that met the conditions of this paragraph (a) will satisfy this paragraph (a), provided the holdover rental is on the same terms and conditions as the immediately preceding agreement.	The lease covers all of the premises leased between the parties for the term of the lease and specifies the premises covered by the lease.
The space rented or leased does not exceed that which is reasonable and necessary for the legitimate business purposes of the lease or rental and is used exclusively by the lessee when being used by the lessee (and is not shared with or used by the lessor or any person or entity related to the lessor), except that the lessee may make payments for the use of space consisting of common areas if the payments do not exceed the lessee's pro rata share of expenses for the space based upon the ratio of the space used exclusively by the lessee to the total amount of space (other than common areas) occupied by all persons using the common areas.	If the lease is intended to provide the lessee with access to the premises for periodic intervals of time, rather than on a full-time basis for the term of the lease, the lease specifies exactly the schedule of such intervals, their precise length, and the exact rent for such intervals.
The rental charges over the term of the agreement are set in advance and are consistent with fair market value.	The term of the lease is for not less than one year.
The rental charges over the term of the agreement are not determined-- (i) In a manner that takes into account the volume or value of any referrals or other business generated between the parties; or (ii) Using a formula based on— (A) A percentage of the revenue raised, earned, billed, collected, or otherwise attributable to the services performed or business generated in the office space; or (B) Per-unit of service rental charges, to the extent that such charges reflect services provided to patients referred between the parties.	The aggregate rental charge is set in advance, is consistent with fair market value in arms-length transactions and is not determined in a manner that takes into account the volume or value of any referrals or business otherwise generated between the parties for which payment may be made in whole or in part under Medicare or a State health care program.
The agreement would be commercially reasonable even if no referrals were made between the lessee and the lessor.	The aggregate space rented does not exceed that which is reasonably necessary to accomplish the commercially reasonable business purpose of the rental.
	The term fair market value means the value of the rental property for general commercial purposes, but shall not be adjusted to reflect the additional value that one party (either the prospective lessee or lessor) would attribute to the property as a result of its proximity or convenience to sources of referrals or business otherwise generated for which payment may be made in whole or in part under Medicare or a State health care program.

Practitioner Recruitment

Stark Stark exception to the referral prohibition related to compensation arrangements for physician recruitment	Anti-Kickback Safe harbor for payments by an entity to induce a practitioner to relocate a practice into a Health Professional Shortage Area (HPSA) for his/her specialty area
The remuneration, provided by a hospital to recruit a physician, is paid directly to the physician and is intended to induce the physician to relocate his or her medical practice to the geographic area served by the hospital in order to become a member of the hospital's medical staff.	The payments are to induce a practitioner who has been practicing within his or her current specialty for less than one year to locate, or to induce any other practitioner to relocate, his or her primary place of practice into a HPSA for his or her specialty area that is served by the entity.
The arrangement is set out in writing and signed by both parties.	The arrangement is set forth in a written agreement signed by the parties that specifies the benefits provided by the entity, the terms under which the benefits are to be provided, and the obligations of each party.
The arrangement is not conditioned on the physician's referral of patients to the hospital.	If a practitioner is leaving an established practice, at least 75 percent of the revenues of the new practice must be generated from new patients not previously seen by the practitioner at his or her former practice.
The hospital does not determine (directly or indirectly) the amount of the remuneration to the physician based on the volume or value of any actual or anticipated referrals by the physician or other business generated between the parties.	The benefits are provided by the entity for a period not in excess of 3 years, and the terms of the agreement are not renegotiated during this 3-year period in any substantial aspect; provided, however, that if the HPSA to which the practitioner was recruited ceases to be a HPSA during the term of the written agreement, the payments made under the written agreement will continue to satisfy this paragraph for the duration of the written agreement (not to exceed 3 years).
The physician is allowed to establish staff privileges at any other hospital(s) and to refer business to any other entities (except as referrals may be restricted under a separate employment or services contract).	There is no requirement that the practitioner make referrals to, be in a position to make or influence referrals to, or otherwise generate business for the entity as a condition for receiving the benefits; provided, however, that for purposes of this paragraph, the entity may require as a condition for receiving benefits that the practitioner maintain staff privileges at the entity.
In the case of remuneration provided by a hospital to a physician either indirectly through payments made to another physician practice, or directly to a physician who joins a physician practice, the following additional conditions must be met: (a) the written agreement also signed by the party to whom the payments are directly made; (b) except for actual costs incurred by the physician practice in recruiting the new physician, the remuneration is passed directly through to or remains with the recruited physician; (c) in the case of an income guarantee of any type made by the hospital to a recruited physician who joins a physician practice, the costs allocated by the physician practice to the recruited physician do not exceed the actual additional incremental costs attributable to the recruited physician. With respect to a physician recruited to join a physician practice located in a rural area or HPSA, if the physician is recruited to replace a physician who, within the previous 12-month period, retired, relocated outside of the geographic area served by the hospital, or died, the costs allocated by the physician practice to the recruited physician do not exceed either-- (1) the actual additional incremental costs attributable to the recruited physician; or (2) the lower of a per capita allocation or 20 percent of the practice's aggregate costs; (d) records of the actual costs and the passed-through amounts are maintained for a period of at least 5 years and made available to the Secretary of HHS upon request; (e) the remuneration from the hospital under the arrangement is not determined in a manner that takes into account (directly or indirectly) the volume or value of any actual or anticipated referrals by the recruited physician or the physician practice (or any physician affiliated with the physician practice) receiving the direct payments from the hospital; (f) the physician practice may not impose on the recruited physician practice restrictions that unreasonably restrict the recruited physician's ability to practice medicine in the geographic area served by the hospital; and (g) the arrangement does not violate the anti-kickback statute or any Federal or State law or regulation governing billing or claims submission.	The practitioner is not restricted from establishing staff privileges at, referring any service to, or otherwise generating any business for any other entity of his or her choosing.
Recruitment of a physician by a hospital located in a rural area to an area outside the geographic area served by the hospital is permitted under this exception if the Secretary of HHS determines in an advisory opinion that the area has a demonstrated need for the recruited physician and all other requirements for recruiting are met.
These requirements apply to remuneration provided by a federally qualified health center or a rural health clinic in the same manner as it applies to remuneration provided by a hospital, provided that the arrangement does not violate the anti-kickback statute or any Federal or State law or regulation governing billing or claims submission.
	The amount or value of the benefits provided by the entity may not vary (or be adjusted or renegotiated) in any manner based on the volume or value of any expected referrals to or business otherwise generated for the entity by the practitioner for which payment may be made in whole or in part under Medicare, Medicaid or any other Federal health care programs.
	The practitioner agrees to treat patients receiving medical benefits or assistance under any Federal health care program in a nondiscriminatory manner.
	At least 75 percent of the revenues of the new practice must be generated from patients residing in a HPSA or a Medically Underserved Area (MUA) or who are part of a Medically Underserved Population (MUP).
	The payment or exchange of anything of value may not directly or indirectly benefit any person (other than the practitioner being recruited) or entity in a position to make or influence referrals to the entity providing the recruitment payments or benefits of items or services payable by a Federal health care program.