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What are the penalties for violating the Stark Law?

The Stark law was named for its co-sponsor, Congressman Pete Stark, but it may as well have been named for its stark treatment of physicians who violate its regulations. The Stark law is considered a strict liability law—that means that anyone who violates it can be penalized, even if they had no intention of committing a violation. Ignorance of the law isn't an excuse, either. A physician who had no knowledge of committing an infraction may still face the penalties.

But doctors are human, and even the most careful human can make a mistake. When it comes to the Stark law, the ramifications could be severe. Practicing physicians would be wise to know the possible legal penalties of violating the Stark law.

Physicians who are found guilty of violating the Stark law could face the following penalties:

  • The doctor may be prohibited from billing Medicare, Medicaid, the patient or another party for the services that resulted from illegal referrals.
  • Further, any payment to the physician by Medicare or Medicaid for services from unlawful referrals will be denied.
  • The physician could be completely banned from participating in Medicare and Medicaid programs.
  • Any payments that a physician received for services that were the result of an illegal referral must be refunded.
  • A doctor could be fined up to $15,000 for every individual service that violated the law.
  • There could be a fine of up to $100,000 for every circumvention scheme. These are schemes in which a doctor or other parties deliberately arranged for unlawful referrals.

Even for physicians who had the best intentions, violating the stark law could have serious legal consequences that could affect their reputation, practice and livelihood. In these situations, physicians may wish to consult an attorney who has experience in health law.

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