An article co-authored by PYA Principal Angie Caldwell and Jana Kolarik, a partner at Foley & Lardner, was recently published in the June edition of Bloomberg Law. The article, “Regulatory Compliance & Physician Compensation Arrangements,” covers recent revisions to the Stark Law and their effects on physician compensation arrangements. Angie and Jana advise revisiting the meaning of several related concepts, including fair market value, commercial reasonableness, and indirect compensation. They also detail changes related to those three terms, provide an example of an employed surgeon arrangement, and offer key compliance takeaways.
If your review of compensation is only triggered when productivity is above the 50th or 75th percentile, you should fine-tune those assumptions to make compensation consistent with the physician’s personal productivity, not an assumption that anything below the 50th or 75th percentile is deemed FMV. . . . With regard to the CR analysis, ensure that the compensation is commensurate with the services being performed. . . . We would advise reviewing current arrangements that could fall under the definition of indirect compensation arrangements.
Find the full article here.
Physician compensation and new Stark Law regulations were also the focus of Angie and Jana’s recent Let’s Talk Compliance virtual discussion. Find the on-demand recording and slides here.
If you would like additional guidance related to physician compensation strategies and valuation, or for assistance with any matter related to valuation, compliance, or strategy and transactions, one of our executive contacts would be happy to assist. You may email them below, or call (800) 270-9629.