Federal physician self-referral prohibition (42 USC 1395nn.), commonly referred to as the Stark law, is a set of regulations that pertain to physician self-referral under current United States (US) federal law. These statutes currently reside under the purview of Centers for Medicare & Medicaid Services (CMS) fraud and abuse laws. The Stark law was initially enacted in 1992 but expanded in 1995. These regulations limit the financial and business relationships which physicians may enter into. In its incipience, the Stark law applied to physician referral for clinical laboratory services but has since expanded to encompass "designated health services" or DHS. In general terms, DHS refers to the health facility or institution which will perform physical and occupational therapies, clinical laboratory testing, radiology services, provide medical equipment, inpatient hospital services, outpatient prescription services, or home-health services.[1]

Term "referral" means a request for a specific or service by a physician for Medicare Part B services, and/or a plan of care which includes designated health services. Also the term "financial relationship" includes investment interest, ownership, and compensation arrangements.

Broadly, the Stark law prevents a physician from referring patients for DHS if there is a financial relationship between either the physician and the healthcare entity, or his or her immediate family member, and the healthcare entity. Under this law, financial relationships are defined as a physician or an immediate family member who have A) ownership or investment interest in the entity (ownership or investment is further described as equity or debt and includes any interest in a body that holds ownership or investment in the facility providing the designated health service, DHS) B) a compensation arrangement between the physician (or immediate family member) and the entity. Although the inclusion criteria seem fairly capacious and expansive, there are several notable exceptions to this set of laws. Several of the commonly encountered exceptions include:[2](This is a non-exhaustive list)

• Referral to another physician of the same practice as the referring provider
• Referral for in-office ancillary services including laboratory testing and radiological tests in which they are performed within the same location as the provider
• Refer a patient to a family member for DHS in rural areas as designated by CMS
• Referral to pre-paid organizational health services such as health maintenance organizations (HMOs)
• Referral to academic medical centers, certain stipulations apply to the relationship between provider and academic center.
• Referral for preventative services, including screening exams/tests and vaccines.
• Equity in publicly-traded security as issued by a corporation  

Although there are many exceptions that curtail the application of this expansive law, the Stark law is a strict liability statute. This means that a defendant is liable for their actions without proof of specific intent to violate said law. Furthermore, this means that even though a physician may have inadvertently referred a patient for DHS with no intent to bolster the financial status of the healthcare entity providing the DHS, they would still be culpable. Given the similarity between CMS fraud and abuse laws, it is common for multiple CMS fraud and abuse laws to be infringed simultaneously, which can further implicate individuals and institutions.

However, the Stark law can be distinguished from other notable healthcare fraud and abuse laws, including the anti-kickback statute as well as the false claims act. Notable differences between the Stark law and anti-kickback statute include that the latter prohibits knowledge of a willful payment to induce patient referrals or generate business involving any item or service payable by Medicare, Medicaid, or other federal healthcare programs. The false claims act deals with prohibition of fraudulent claims seeking payment from Medicare or Medicaid when a provider knows or should have had knowledge that submitted claims were false or fraudulent. It also goes on to mention that violation of Stark law or anti-kickback statute may also indicate that false claims act may have been broken.

The department of justice, CMS, and the department of health and human services oversees the enforcement of the Stark law. Given recent enactment and amendments to the patient protection and affordable care act and the false claims act leading to more stringent application.

Although some physicians and medical practitioners have railed against the Stark law, making arguments that it impedes the efficient application of healthcare and further entrenches bureaucracy within health administration, it is an essential law. This statute prevents fraudulent and unnecessary testing, referrals, and medical services. Additionally, it prevents physicians from seeking further personal financial or equity gains in regard to patient care which is a clear conflict of interest. With these limitations, it does impact clinical decision making and delivery of healthcare. Physicians and medical practitioners must understand the complexities and nuance nature of these regulations in order to provide high quality and comprehensive care, without committing infractions which could prove disastrous for their medical careers.