Stark law, originally enacted in 1989 to curb physician self-referrals, has become one of the most contentious regulations in American medicine. While designed to protect patients from conflicts of interest, physicians argue that the law has morphed into a tool that protects corporate consolidation rather than patients.
“It was written by senators and lawyers who don’t follow the same rules,” Niazy Selim, MD, a private practice GI surgeon in Lake Charles, La., told Becker’s. “Lawyers can accept referrals — why not physicians? Someone’s life is on the line. If a physician sends a patient to a more qualified physician, Stark law says, ‘no.’ That’s nonsense.”
Dr. Selim described firsthand how Stark law, combined with hospital consolidation, created barriers to timely, expert care.
In one case, a patient with a paraesophageal hernia, a complex condition requiring subspecialty training, was referred in-system to a general surgeon with no expertise in the procedure. The surgeon admitted he couldn’t perform the operation. Frustrated and confused, the patient ultimately found her way to Dr. Selim, but Dr. Selim said the patient filed a complaint with the Louisiana Board of Medicine over the referral breakdown.
“That’s Stark law in play,” Dr. Selim said. “The physician who got the referral knew very well what I do — but the system kept it in-house.”
The law also exacerbates pressures on employed physicians. According to Dr. Selim, many of his colleagues report that hospital administrators review their referral patterns. Physicians are expected to keep patients within the health system, even if that means denying those patients access to the most qualified specialist.
“If you’re employed, you know the consequences of not following what the CEO wants,” he said. “It’s all about the money.”
Other physician leaders echo Dr. Selim’s concerns. Marc Greenberg, MD, an orthopedic surgeon in Baltimore, told Becker’s that Stark law creates a paradox “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.”
This paradox grows sharper as private equity firms and insurers acquire physician groups while physicians face restrictions on ownership.
What began as an anti-kickback safeguard has become “a complex and vague statute,” Dr. Greenberg said. Each deviation from standard practice requires costly legal consultation.
In 2024, Stark-related enforcement surged: 979 whistleblower lawsuits and $2.92 billion in False Claims Act settlements were recorded, with many cases driven not by agencies but by whistleblowers.
Across the country, physician leaders are calling for reform. Organizations like the Medical Group Management Association have labeled Stark law a “major regulatory burden,” and bipartisan lawmakers have begun floating reforms, including a 2024 House bill to expand in-office exemptions.
Whether reform will come through repeal, reinterpretation or piecemeal erosion remains uncertain. But physicians like Dr. Selim believe the status quo is unsustainable.
“Hospitals have powerful lobbies. Doctors can’t unionize, so we don’t have a real voice,” he said. “Yet we’re the ones caring for patients. Stark law doesn’t protect patients — it hurts them.”
