Florida’s Patient Self Referral Act (“Self Referral Act”), like the Federal Stark law, prohibits physicians from referring patients to entities in which they have a financial interest. Both Stark and the Self Referral Act, however, provide an exception when the referring physician is an owner of the practice or other entity to which the referral is being made.

The Self Referral Act requires “direct supervision” by the referring physician during the referred ancillary service, but does not define the scope of that requirement. As such, most health care attorneys have looked to the Center for Medicare and Medicaid Services (“CMS”) Regulations for guidance on the supervision level required for ancillary services provided in Florida.

CMS has established three levels of physician supervision in the Medicare Physician Fee Schedule, based on the sophistication and risk of the diagnostic tests (i.e., general, direct, and personal supervision). This three-tiered system allows certain normal/routine physician ancillary services, such as X-rays, lab work and sleep studies, to be performed by qualified staff members, (without a physician’s presence during the procedure).

Without clear guidance from the Florida Medical Board or similar regulatory body, Florida physicians and health care attorneys assumed that the Self Referral Act’s supervision requirements would align with CMS’ rules. The Florida Board of Medicine clearly and unequivocally rejected that assumption in its December 19, 2007 Declaratory Statement. The Board stated that the referring physician or a member of the physician’s group practice must be “present in the office suite and immediately available, except for brief unexpected or routine absences of short duration.” This applies the “direct supervision” rules to all ancillary services and self referrals in Florida. Therefore, many ancillary services requiring only general supervision under CMS rules (i.e., no physician presence), such as sleep studies, X-rays, and other diagnostic tests, will now require direct supervision under the Self Referral Act. In fact, any service provided by an entity in which the referring physician has a financial interest must be scrutinized under the Self Referral Act, since the Act governs all health services and supplies.

The reach of this supervision requirement for self referrals under Florida Law is much broader than Stark’s application. Our clients should take special note of this new ruling and support regional health care associations in their lobbying efforts to amend the Self Referral Act.

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