The Stark Law in retrospect

Abstract

Considering the ultimate goals of preventing the over-utilization of medical services and protecting the Medicare program, are the numerous phases of the Stark Law and their concomitant regulations effective; or, conversely, has the legislation served to impede entrepreneurialism among physicians to the detriment of innovations and better integration in the delivery of medical treatment? This article endeavors to answer the above question through an analysis of the policy goals behind the legislation; the evolution of its regulations; its effect on competitiveness in the field of medicine; and the ethical considerations implicated by the issue of physician self-referral. It further offers some proposals which attempt to address the problem of physician self-referral abuse while at the same time reducing the complexity and breadth of the Stark law and its regulations. The article concludes by noting that to truly change the practice of inappropriate self-referral as well as the culture of over-utilization, it is necessary not only to target specific relationships and practices prone to abuse, but to realign the financial incentives created by our current payment mechanisms as well.