Teton Regional Healthcare (TRH) is healthcare system located in Jackson, WY. It consists of a main hospital (200 beds), a small critical access hospital (25 beds), an ambulatory surgical center, a freestanding imaging center, skilled nursing facility, a mental health and substance abuse facility, and 20 primary and specialty physician clinics. A subsidiary of TRH is Teton Physician Network (TPN), which consists of 220 employed physicians covering several different specialties including primary care, orthopedics, cardiology, oncology, and neurology to name a few.

Steven Moffitt (Steve) is the Chief Financial Officer for TPN. He was hired six months ago, having relocated from the Midwest. His wife grew up near Jackson, WY. To fulfill a promise to one day return to the area, Steve applied for, and was offered, this CFO position with TPN.

Steve contacts Jennifer Cohen (Jen), TRH's Chief Compliance Officer (CCO) to meet and discuss some concerns he recently identified. After meeting with Steve, Jen learns of four potential Stark law issues regarding TRH's financial relationships with some of its physicians (TPN employed and independent contractor specialists).

Assumptions

• Assume TRH is enrolled and participates in Medicare and Medicaid.
• Assume TRH has a compliance department that consists of the CCO (Jen), and four compliance specialists.
• Assume that fair market value compensation can be determined from hiring a third-party consultant, or consulting periodicals that publish such data.
• Assume the Federal Stark law governs all financial relationships mentioned below between TRH and the physicians.

Under each issue, you have been provided a modified version of the applicable regulation for you to use in responding. As such, when responding to a question, consider where in the applicable regulation, the language supports your position. You may also consider other operational concerns. For example, if the allegation were true, how would that impact a particular department or the organization?

• Issue One - Physician Gifts/Nonmonetary Compensation (NMC)
• Issue Two - Employed Physician Compensation
• Issue Three - Contracted Physician Compensation
• Issue Four - Contracts Database and Compensation Policies

Please limit discussion to Stark only. Though the fact pattern above could also implicate the Anti-kickback Statute and the False Claims Act, please limit your discussion to analysis under the Stark law. When we get to the False claims act, we will tie in the relationship between that law, the Stark law and Anti-kickback Statute.