A home health services provider has agreed to pay $702,541.20 to resolve allegations that it violated the Physician Self-Referral Law, commonly known as the Stark Law, by making bonus payments to an employee based on the number of patient referrals made by the employee’s spouse, a physician. The United States Attorney’s Office for the Southern District of Florida made the announcement on January 26, 2026.
The Stark Law prohibits entities from submitting claims to Medicare for certain designated health services that result from referrals by a physician who has a financial interest with the entity, unless a specific exception applies. In this matter, the physician’s spouse was employed by the home health service provider, and the alleged conduct did not meet any Stark Law exception. Additionally, the Anti-kickback Statute was violated when the physician’s spouse received bonus payments based on referrals the physician made to the home health services provider.
The alleged misconduct occurred from February 2017 through February 2025 and involved a physician referring Medicare beneficiaries to the home health service provider for designated health services. The provider then allegedly furnished those services and submitted claims to Medicare for reimbursement.
Of the $702,541.20 settlement amount, $379,752 will be paid as restitution.
Compliance Perspective
Issue
The Physician Self-Referral Law (Stark Law) prohibits healthcare providers from submitting claims to Medicare for certain designated health services that result from referrals by a physician who has a financial relationship with the provider, unless a statutory or regulatory exception applies. Financial relationships may include compensation arrangements involving physicians or their immediate family members. The Stark Law is intended to prevent financial considerations from improperly influencing referral decisions and to protect Medicare beneficiaries from unnecessary or inappropriate services. Claims submitted to Medicare in violation of the Stark Law may also result in liability under the federal False Claims Act. The Federal Anti-Kickback statute is a law that prohibits any business or a person from offering money to any medical personnel in return for the recommendation of a product or services to patients on certain federally covered medical programs. These medical programs include Medicare and Medicaid.
Discussion Points
- Review policies and procedures governing physician referrals and compensation arrangements to ensure compliance with Stark Law and Anti-kickback Statute requirements. Policies should clearly define permissible arrangements, approval processes, and monitoring responsibilities. Providers may benefit from periodic policy reviews conducted in collaboration with compliance or regulatory consultants to identify gaps and address emerging risk areas.
- Provide ongoing education and training for staff on Stark Law and Anti-kickback Statute requirements, appropriate referral practices, and the identification of potential noncompliant arrangements. Med-Net Academy offers the course Medical Director Contracts in a Nursing Facility, which covers the Stark Law and the Anti-Kickback Statute, as well as key components required in physician contracts. Staff should also be instructed on internal reporting mechanisms for suspected compliance concerns.
- Conduct regular audits to assess compliance with referral practices and related financial arrangements. Audits should include a review of referral patterns, compensation structures, and supporting documentation to ensure adherence to Stark Law and Anti-kickback Statute requirements. Utilizing independent or external compliance reviews, such as mock audits or focused assessments, can help identify potential deficiencies early and support corrective action before regulatory issues arise.
*This news alert has been prepared by Med-Net Concepts, Inc. for informational purposes only and is not intended to provide legal advice.*