The Let’s Talk Compliance podcast series is for healthcare leaders and compliance professionals, as well as providers, suppliers, vendors, and others in the healthcare industry. In each episode, a Foley & Lardner attorney and a PYA advisor discuss a trending compliance topic and address questions they hear most often from clients.
In the July 31 episode, “Subsidy Arrangements Between Hospitals and Physician Practices: What You Should Know,” Jana Kolarik, Foley & Lardner Partner, and Angie Caldwell, PYA Consulting Principal and Tampa Managing Principal, discuss the recent increase in subsidy activity in the industry and the regulatory risks and responsibilities of such financial assistance agreements.
Caldwell and Kolarik state that subsidies require financial transparency, and because they bring the practice and hospital into close relationship, the arrangements must be fair market value and commercially reasonable. A thorough valuation should be performed, and the two parties should be in alignment about the duration and type of the reconciliation. Additionally, Caldwell shares that subsidies often are needed to meet fair market value compensation for physicians in the practice. In all cases, both parties need to consider the Stark Law and Anti-Kickback Statute before embarking on a subsidy arrangement.
The Let’s Talk Compliance podcast is part of Foley & Lardner’s Health Care Law Today podcast series. Listeners can subscribe to both series on Apple Podcasts, Spotify, or their preferred podcast app.
The first episode, “Post-Pandemic: Time to Refocus on Your Compliance Program,” launched on June 29, 2023.
If you would like assistance with developing or assessing a compliance program or any other matter related to valuation, provider compensation design, compliance, regulatory requirements, strategy, or transactions, one of our executive contacts would be happy to assist. You may email them below or call (800) 270-9629.