U.S. Court of Appeals Reverses Decision Interpreting Stark Fair Market Value Standard

The U.S. Court of Appeals for the Third Circuit issued an opinion overturning a previous decision based in part on a determination that the lower court misapplied the fair market value standard under the Stark law, according to a report by HealthCare Appraisers in its FMVantage Point publication.

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The case involved the exclusive provision of pain management services at a hospital-owned pain clinic by a group of anesthesiologists. Whistleblower action alleged that the arrangement violated the Stark law on several grounds, including the allegation that compensation for the services was not consistent with FMV.
 
The Court of Appeals found that, because the parties were in a position to refer to one another, the fact that they engaged in actual arms-length negotiations could not conclusively establish that the compensation was consistent with FMV.

To read the complete report in FMVantage Point, click here.

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