Home care providers of all types have often expressed concerns about hospitals that put pressure on physicians, especially those they employ or with whom they contract, to make referrals within the hospital system. Hospitals often view these activities in terms of prevention of “patient leakage.” Are hospitals allowed to require physicians to direct referrals to designated providers?
The so-called Stark law and regulations permit hospitals that employ physicians or contract with them to require referrals of patients to particular providers as a condition of employment or independent contractor relationships. Effective on January 19, 2021, new regulations related to the Stark laws expanded and underscored the ability of hospitals to require physicians to send referrals to particular providers. These new regulations also make it clear that providers can monitor and enforce requirements to direct referrals to designated providers.
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