The healthcare reform legislation amends the in-office ancillary service exception to the limitation on physician referral law, commonly known as the Stark law. The law generally prohibits physicians from referring patients to an entity in which the physician has a financial relationship for certain health services known as “designated health services” under the stark law unless the arrangement is covered by an exception. The in-office ancillary service exception generally allowed a physician to refer a patient for a service to be performed in the same group practice as the referring physician, as long as certain billing and location requirements were met.

The amendments require physicians to provide a patient with additional information when a physician makes a referral under the in-office ancillary services exception. The amended statute states that at the time of the referral, the physician must inform the patient that the patient may obtain the referred services from somewhere other than the group practice and must provide the patient with a list of providers who furnish such services near the patient’s home.

The amendment states that the disclosure requirement applies to referrals for magnetic resonance imaging, computed tomography, positron emission tomography, and any other designated health services the Secretary of the Department of Health and Human Services (“DHHS”) may determine to be appropriate.

The amendment states that its effective date is January 1, 2010. Accordingly, it is recommended that physicians who refer patients “in-office” for magnetic resonance imaging, computed tomography, positron emission tomography provide the notice immediately. DHHS is expected to issue regulations providing more specific requirements and adding more types of services for which the notification requirements will apply.

The author may be contacted at hvelandia@dsda.com