February 2000 Bulletin

Background

The "Stark" provisions (sponsored by ep. Fortney "Pete" Stark (D-Calif.) are included in the Omnibus Budget Reconciliation Act of 1989 (OBRA 1989) (often referred to as "Stark I") and the Omnibus Budget Reconciliation Act of 1993 (OBRA 1993) (often referred to as "Stark II"). These provisions limit certain referral and compensation arrangements for physicians.

The provisions of "Stark I" prohibit physician referrals of Medicare patients for clinical laboratory services when the physician has a financial interest in an arrangement with the clinical lab. This legislation was passed in Dec. 1989, and a final rule was eventually published in the Federal Register on Aug. 14, 1995. A proposed rule in the Federal Register published on Jan. 9, 1998 suggests some modifications to this final rule.

The provisions of "Stark II" expand upon the restrictions of "Stark I," and further limit certain referral and compensation arrangements for physicians. "Stark II" became effective on Jan. 1, 1995. On Jan. 9, 1998, HCFA issued a proposed rule to provide some guidance on compliance with the "Stark II" provisions, and included additional modifications to the "Stark I" final rule.


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