re: Zachary lab owner faces Medicare, Medicaid fraud charges

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Qualifying As A Group Practice. To meet the IOAS exception, first the practice must qualify as a “group practice” under Stark (42 C.F.R. §411.352). There are a number of requirements that a practice must meet to qualify as a group practice under Stark, and it is important to run through them all with your counsel. However, most traditional practices should qualify as long as they do not have a lot of part-time or independent contractor physicians and they are operated as a unified business. In addition, physician compensation must meet certain requirements, particularly the allocation of revenues and profits from designated health services. A group practice can pay its physician (i) a productivity bonus that includes services performed personally by the physician or by others “incident to” the physicians’ services; or (ii) a share of overall profits derived from all designated health services, as long as the share is determined in a manner that doesn’t directly relate to referrals (e.g., per capital, per wRVUs, etc.). If the practice is large, multiple profit pools are possible as long as each pool contains at least five physicians.

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