The Stark Law and Its Intersection With the Anti-Kickback Statute (AKS)

The Stark Law and Its Intersection With the AKS at a Glance

The Stark Law and the Anti-Kickback Statute (AKS) are two critical legal frameworks in the United States that regulate physician self-referrals and kickback arrangements in the healthcare industry. While both laws aim to prevent conflicts of interest and improper financial incentives in the referral of healthcare services, they differ in scope, enforcement, and penalties. The Stark Law, found in 42 U.S.C. § 1395nn, prohibits physician self-referrals for designated health services to entities with which the physician has a financial relationship, unless an exception applies. The AKS, codified at 42 U.S.C. § 1320a-7b(b), criminalizes the offer, payment, solicitation, or receipt of remuneration to induce or reward referrals of items or services payable by federal health care programs. While the Stark Law is a civil statute with strict liability, the AKS carries criminal penalties, including fines and imprisonment.

The Legal Framework

The Stark Law, as set forth in 42 U.S.C. § 1395nn, imposes a strict-liability civil prohibition on physician self-referrals for designated health services to entities with which the physician has a financial relationship. This prohibition applies unless an exception is met, and the statute is administered by the Centers for Medicare & Medicaid Services (CMS). The law is enforced through civil monetary penalties, including a maximum of $15,000 for each service billed in violation and $100,000 for each circumvention arrangement or scheme, as outlined in 42 U.S.C. § 1395nn(g)(3)–(4).

The Anti-Kickback Statute, 42 U.S.C. § 1320a-7b(b), criminalizes the knowing and willful offer, payment, solicitation, or receipt of remuneration to induce or reward referrals of items or services payable by a federal health care program. Violations of the AKS are punishable by a fine of not more than $100,000 or imprisonment of not more than 10 years, or both. Additionally, as noted in 42 U.S.C. § 1320a-7b(g), a claim that includes items or services resulting from an AKS violation is considered a false or fraudulent claim under the False Claims Act (31 U.S.C. ch. 37, subch. III).

The Federal Overlay

The federal Anti-Kickback Statute, 42 U.S.C. § 1320a-7b(b), makes it a felony to knowingly and willfully offer, pay, solicit, or receive remuneration to induce or reward referrals of items or services payable by a federal health care program. The Stark Law, 42 U.S.C. § 1395nn, separately prohibits physician self-referrals for designated health services payable by Medicare or Medicaid, on strict-liability terms. Both regimes carry safe harbors and exceptions published at 42 C.F.R. § 1001.952. State referral and fee-splitting statutes operate alongside these federal prohibitions and can apply even where no federal program payment is involved.

Reading the Research Desk

For further exploration, see the following related pages: Practice Areas, The Anti-Kickback Statute Explained, Safe Harbors Under the Anti-Kickback Statute, AKS and Stark Law: How the Two Regimes Overlap, Recent Anti-Kickback Statute Decisions, and FAQ.