Healthcare Regulatory Compliance

Whether it’s compensation agreements, supplier-provider joint ventures, or patient discounts, know how to navigate federal and state regulations.


Physicians, hospitals, clinics, and suppliers must all be aware of the web of federal and state regulations that impact their most fundamental transactions. What is common in many other industries, such as paying incentives to use your product, or compensating partners based on revenue generated, can result in serious civil or criminal penalties in the health care industry.

These regulations do not mean that healthcare providers and suppliers must avoid entering into lawful transactions that make business sense. What it does mean is that they must carefully consider the applicable law, and structure transactions to ensure full compliance.

ASG Law can help you navigate and cultivate a culture of compliance with the following health care laws:

Federal Stark Law prohibits physicians from referring patients for “designated health services” payable by Medicare or Medicaid to entities with which the physician or an immediate family member has a financial relationship. It also prohibits the designated health services entity from submitted claims to Medicare for those services resulting from a prohibited referral. In other words, a physician cannot refer patients to an imaging center in which the physician has invested, unless an exception applies.  There are a number of exceptions, but determining if they are applicable is not straightforward. Violations of the Federal Stark Law can result in civil penalties.

Federal False Claims Act (FCA) makes it illegal to submit claims for payment to Medicare or Medicaid that the biller knows or should know are false or fraudulent. Each instance of an item or service billed to Medicare or Medicaid counts as a claim, so fines can add up quickly. Violations of the FCA can result in civil and criminal penalties.

Federal Anti-Kickback Statute (AKS) prohibits offering, paying, soliciting or receiving anything of value to induce or reward referrals or general Federal health care program business. There are a number of safe harbors that will protect properly structured business arrangements. Violations of the AKS can result in civil and criminal penalties.

Physician Payments Sunshine Act requires manufacturers of drugs, medical devices and biologicals that participate in Federal healthcare programs to track and then report certain payments and items of value given to physicians and teaching hospitals. Manufacturers are required to collect certain specified information and report the same to the Center for Medicare & Medicaid Services.

There are also corollary state laws and regulations that are similar (but not always the same) to the federal statutes.