CHA News Article

Settlement Against Hospital Involves Stark Law Violation Related to Medicaid

A hospital in St. Petersburg, Florida this month entered into a False Claims Act settlement with the U.S. and the state of Florida that could have significant implications for the “Stark law,” which governs physician self-referrals. The whistleblower action brought against All Children’s Hospital involved Medicaid billings by the hospital for services resulting from referrals that allegedly violated the Stark law. Until now, it has been widely held that the law prohibits referrals for designated health services covered by Medicare but that the referral and billing prohibitions do not apply to Medicaid patients — based on the language of the Stark law, regulations, guidance and statements from the Centers for Medicare & Medicaid Services. The Schubert v. All Children’s Health System case and other trends suggest that billings related to Medicaid patients may need to be considered in the context of the Stark law.