After a physician group acquisition, compliance teams should check every inherited compensation arrangement for three Stark Law red flags in the first 30 days, according to an Oct. 12 blog post from Ntracts, a healthcare contract management company.
Here are the three red flags, plus how to track what turns up:
1. No signed writing. Most Stark compensation exceptions require the arrangement to be in writing. A collection of documents can meet that requirement, but each party’s signature must appear on at least one contemporaneous writing. Limited grace periods exist for getting missing signatures.
2. Payments past the end date. Holdover arrangements can continue indefinitely if they run on the same terms as the original and keep certain safeguards in place, under the Bipartisan Budget Act of 2018 and a CMS final rule that took effect Jan. 19, 2021. Ntracts treats this flag as a reason to check, not as a finding. The questions are whether anyone is tracking the renewal and whether the rate or terms have changed.
3. No fair market value support. Nearly every Stark exception requires pay to be consistent with fair market value. A valuation dated before a raise or a change in duties no longer supports current pay.
4. Two or more flags move an arrangement up. Any single flag is worth escalating. An arrangement with two or more goes to the top of the review list. Ntracts also recommends watching for duties on paper that don’t match the work being done, several arrangements for the same physician being reviewed separately, and payments approved by staff who have since left.
5. An ownership map assigns accountability. For each arrangement, Ntracts recommends recording four things: a named owner (a person, not a department), the end or renewal date with its notice window, the contracted duties and how those duties are documented. The documentation column is the one most often left blank. The company recommends setting a reminder at least 90 days before each end date.
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