Stark law was created to prevent financial conflicts of interest in physician referrals, but many healthcare leaders say the decades-old regulation has become increasingly difficult to navigate as care delivery evolves.
For physician organizations and ambulatory surgery centers, the law’s complex requirements can influence everything from physician alignment to value-based partnerships.
Here are five physician leaders’ perspectives on the law’s impact today.
1. Peter Bravos, MD — CMO, Sutter Health’s Surgery Center Division, Sacramento, Calif.: “The Stark law was designed to prevent financial conflicts in a fee-for-service healthcare system. While its purpose remains valid, strict liability framework no longer reflects how care is delivered today. Even minor technical errors may trigger mandatory repayment and potential False Claims Act exposure, regardless of intent or patient harm. This creates a significant compliance burden and discourages participation in today’s more innovative, value-based care models.”
2. Ahmad Maarouf, MD — CMO, Henry Ford Wyandotte Hospital: “In my view, the Stark law served an important purpose when the healthcare system was primarily structured around a fee-for-service model. As the industry transitions toward value-based care and population health management, the law is increasingly limiting innovation.
Physicians and physician organizations are often constrained by the technical requirements of the Stark law, which can inhibit creative and forward-thinking approaches to delivering high-quality, cost-efficient care. The financial risk inherent in value-based and population health models presents a significant barrier, particularly when physicians and physician organizations are unable to enter into arrangements with third parties that are willing to share or assume that risk.
Additionally, the Stark law may restrict the formation of these collaborative relationships on technical grounds. The fair market value requirements can further complicate such arrangements, as they may not adequately capture or assign value to the efforts and infrastructure required for successful value-based initiatives. Population health and value-based models inherently consider the number of covered lives, indirectly tied to referral volume, which conflicts with current Stark law compliant FMV standards.”
3. Harpreet Pall, MD — CMO, Jersey Shore University Medical Center and K. Hovnanian Children’s Hospital: “While the Stark law continues to serve an important purpose in preventing inappropriate financial relationships and protecting patients, its complexity and rigidity often create friction for physician organizations trying to innovate. Many contemporary care models, including clinically integrated networks, value-based arrangements and service line structures, require significant legal interpretation and compliance infrastructure to operationalize collaborations that are fundamentally aligned with quality and value goals. For physicians, this can translate into administrative burden, slowed program development and hesitancy to pursue potentially beneficial partnerships, even when patient interest is clearly at the center.”
4. Marc Greenberg, MD — Orthopedic Surgeon (Baltimore): “We’ve created a system where for-profit entities can have healthcare ownership. But the people who took an oath to serve the patient — who’ve shown a commitment to caring — can’t.”
5. Esme Singer, MD — CMO, Temple Faculty Physicians at the Lewis Katz School of Medicine, Philadelphia: “While I appreciate the original intent of the law, it seems misaligned and antiquated given how care is delivered and reimbursed today.”
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