In July 2015, CMS released proposals to provide several new Stark Law exceptions and to clarify issues regarding existing exceptions.  Over the next few days, I will post comments on what I consider the most significant new exceptions and clarifications.  The full text of these proposals and CMS comments and explanations are available at:

New Recruitment of Non-Physician Practitioners Exception

CMS has proposed to establish a new exception as 42 C.F.R. § 411.357(x) to permit remuneration from a hospital, a federally qualified health center (FQHC), or a rural health center (RHC) to a physician to assist the physician in employing a non-physician practitioner in the geographic area served by the hospital, FQHC, or RHC providing the remuneration.

  1. The proposed exception would apply only where the non-physician practitioner is a bona fide employee of the physician receiving the remuneration from the hospital (or of the physician’s practice) and the purpose of the employment is primarily to provide primary care services to patients of the physician practice.  CMS believes employment is greater proof a sincere commitment then just an independent contractor relationship.
  2. Primary care services includes general family practice, general internal medicine, pediatrics, geriatrics, and obstetrics and gynecology patient care services.
  3. “Non-physician practitioner” is defined for purposes of this exception, to include only physician assistants, nurse practitioners, clinical nurse specialists, and certified nurse midwives.
  4. There is a 2-year limit on the assistance which is intended to prevent ongoing payment to the physician that could serve as a reward for past referrals or an inducement to continue making referrals to the hospital, FQHC, or RHC, and the amount is proposed to not exceed 50% of actual salary, signing bonus and benefits or the amount equal to the excess of these costs over actual NPP receipts.