Stark Law Penalties and Enforcement

Potential Penalties

Penalties for violating the Stark Law run from somewhat innocuous to severe, depending on the circumstances. These penalties can include the following:

  • Denial of the payment claimed
  • Mandatory repayment of claims paid for services that should not have been paid due to the violation
  • a $15,000 fine for each service unlawfully claimed
  • 3 times the amount of any improper payment
  • a $100,000 fine for attempting to circumvent Stark Law regulations
  • Exclusion from participating in government health care programs

These penalties arise from Stark Law itself and through the Federal False Claims Act.

Enforcement: Who’s Policing Stark Law?

The Center for Medicare and Medicaid Services (CMS) is primarily responsible for enforcing the Stark Law regulations. CMS also provides Advisory Opinions to assist providers in their compliance efforts. The HHS OIG will also investigate Stark Law violations for the purpose of assessing Civil Monetary Penalties or exclusions. The OIG will typically be involved only if the Stark Law issues are in conjunction with Anti-Kickback or False Claims allegations.

More often than not, it seems that the real policing force for Stark Laws are competitors or former employees. If a competitor believes that you are violation the law and are thereby gaining an advantage, they have an incentive to report the allegation. Similarly, an employee who believes there is a violation but is not empowered to do anything to about it may alert the government of the infraction.