Federal Regulation of Physicians

Generally, public health is regulated by state laws.  The federal legislature has no jurisdiction over general public health regulation.  However, in certain matters Congress makes laws with regard to regulation of physicians that comply with the US constitution.

The Stark law is a federal law that is formed against physician self-referral.  Physician self-referral is the practice of a physician referring a patient to a medical facility in which s/he has a financial interest, be it ownership, investment, or a structured compensation arrangement.  Even if the financial interest is of a close family member of the physician, the Stark law is applicable.  It is a strict liability statute.  The first legislation, Stark I, barred physicians from self-referrals for clinical laboratory services under the Medicare program.  Stark II has restricted a range of additional health services and applied it to both Medicare and Medicaid.  Both the legislation has several exceptions that do not make self referral.  However, to come under the exception, all the elements provided under the exception are to be fulfilled.

The Stark Law provides significant civil sanctions for violations including denial of payment, refunds of amounts collected in violation, a civil money penalty (CMP) of up to $15,000 for each bill or claim for a service a person knows is a service for which payment may not be made, the imposition of up to three times the amounts for each item or service wrongfully claimed, and potential exclusion from Federal health care programs.

The federal anti-kickback law was enacted to protect patients and the federal health care programs from fraud and abuse.  Anti-kickback laws curtail the corrupting influence of money on health care decisions.  Anyone who knowingly and willfully receives or pays anything of value to influence the referral of federal health care program business, including Medicare and Medicaid, can be held liable under the law.  Such violations are a felony and can have severe consequences.  The law requires a person to knowingly and willfully engage in the prohibited conduct for the imposition of criminal sanctions.  Violations of the law are punishable by up to five years in prison, criminal fines, administrative civil money penalties, and mandatory exclusion from participation in federal health care programs.

The Health Insurance Portability and Accountability Act (HIPPA) is an Act created to improve the health insurance system.  HIPAA consists of two sections.  Title I of the Act protects health insurance coverage for workers and their families when they change or lose their jobs.  Title II includes an administrative simplification section which deals with the standardization of healthcare-related information systems.  HIPAA regulates the availability of group health plans and certain individual health insurance policies.  The Act also defines numerous offenses relating to health care and sets civil and criminal penalties for them.  It creates several programs to control fraud and abuse within the health care system.

The HIPAA Privacy Rule is the first comprehensive federal protection for the privacy of personal health information.  The Act provides federal protections for personal health information held by covered entities.  It gives patients an array of rights with respect to that information.  The HIPPA Privacy Rule also permits the disclosure of personal health information needed for patient care and other important purposes.


Inside Federal Regulation of Physicians