From the U.S. Code Online via GPO Access [wais.access.gpo.gov] [Laws in effect as of January 23, 2000] [Document not affected by Public Laws enacted between January 23, 2000 and December 4, 2001] [CITE: 42USC1395nn] TITLE 42--THE PUBLIC HEALTH AND WELFARE CHAPTER 7--SOCIAL SECURITY SUBCHAPTER XVIII--HEALTH INSURANCE FOR AGED AND DISABLED Part D--Miscellaneous Provisions Sec. 1395nn. Limitation on certain physician referrals (a) Prohibition of certain referrals (1) In general Except as provided in subsection (b) of this section, if a physician (or an immediate family member of such physician) has a financial relationship with an entity specified in paragraph (2), then-- (A) the physician may not make a referral to the entity for the furnishing of designated health services for which payment otherwise may be made under this subchapter, and (B) the entity may not present or cause to be presented a claim under this subchapter or bill to any individual, third party payor, or other entity for designated health services furnished pursuant to a referral prohibited under subparagraph (A). (2) Financial relationship specified For purposes of this section, a financial relationship of a physician (or an immediate family member of such physician) with an entity specified in this paragraph is-- (A) except as provided in subsections (c) and (d) of this section, an ownership or investment interest in the entity, or (B) except as provided in subsection (e) of this section, a compensation arrangement (as defined in subsection (h)(1) of this section) between the physician (or an immediate family member of such physician) and the entity. An ownership or investment interest described in subparagraph (A) may be through equity, debt, or other means and includes an interest in an entity that holds an ownership or investment interest in any entity providing the designated health service. (b) General exceptions to both ownership and compensation arrangement prohibitions Subsection (a)(1) of this section shall not apply in the following cases: (1) Physicians' services In the case of physicians' services (as defined in section 1395x(q) of this title) provided personally by (or under the personal supervision of) another physician in the same group practice (as defined in subsection (h)(4) of this section) as the referring physician. (2) In-office ancillary services In the case of services (other than durable medical equipment (excluding infusion pumps) and parenteral and enteral nutrients, equipment, and supplies)-- (A) that are furnished-- (i) personally by the referring physician, personally by a physician who is a member of the same group practice as the referring physician, or personally by individuals who are directly supervised by the physician or by another physician in the group practice, and (ii)(I) in a building in which the referring physician (or another physician who is a member of the same group practice) furnishes physicians' services unrelated to the furnishing of designated health services, or (II) in the case of a referring physician who is a member of a group practice, in another building which is used by the group practice-- (aa) for the provision of some or all of the group's clinical laboratory services, or (bb) for the centralized provision of the group's designated health services (other than clinical laboratory services), unless the Secretary determines other terms and conditions under which the provision of such services does not present a risk of program or patient abuse, and (B) that are billed by the physician performing or supervising the services, by a group practice of which such physician is a member under a billing number assigned to the group practice, or by an entity that is wholly owned by such physician or such group practice, if the ownership or investment interest in such services meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse. (3) Prepaid plans In the case of services furnished by an organization-- (A) with a contract under section 1395mm of this title to an individual enrolled with the organization, (B) described in section 1395l(a)(1)(A) of this title to an individual enrolled with the organization, (C) receiving payments on a prepaid basis, under a demonstration project under section 1395b-1(a) of this title or under section 222(a) of the Social Security Amendments of 1972, to an individual enrolled with the organization, (D) that is a qualified health maintenance organization (within the meaning of section 300e-9(d) \1\ of this title) to an individual enrolled with the organization, or --------------------------------------------------------------------------- \1\ See References in Text note below. --------------------------------------------------------------------------- (E) that is a Medicare+Choice organization under part C of this subchapter that is offering a coordinated care plan described in section 1395w-21(a)(2)(A) of this title to an individual enrolled with the organization. (4) Other permissible exceptions In the case of any other financial relationship which the Secretary determines, and specifies in regulations, does not pose a risk of program or patient abuse. (c) General exception related only to ownership or investment prohibition for ownership in publicly traded securities and mutual funds Ownership of the following shall not be considered to be an ownership or investment interest described in subsection (a)(2)(A) of this section: (1) Ownership of investment securities (including shares or bonds, debentures, notes, or other debt instruments) which may be purchased on terms generally available to the public and which are-- (A)(i) securities listed on the New York Stock Exchange, the American Stock Exchange, or any regional exchange in which quotations are published on a daily basis, or foreign securities listed on a recognized foreign, national, or regional exchange in which quotations are published on a daily basis, or (ii) traded under an automated interdealer quotation system operated by the National Association of Securities Dealers, and (B) in a corporation that had, at the end of the corporation's most recent fiscal year, or on average during the previous 3 fiscal years, stockholder equity exceeding $75,000,000. (2) Ownership of shares in a regulated investment company as defined in section 851(a) of the Internal Revenue Code of 1986, if such company had, at the end of the company's most recent fiscal year, or on average during the previous 3 fiscal years, total assets exceeding $75,000,000. (d) Additional exceptions related only to ownership or investment prohibition The following, if not otherwise excepted under subsection (b) of this section, shall not be considered to be an ownership or investment interest described in subsection (a)(2)(A) of this section: (1) Hospitals in Puerto Rico In the case of designated health services provided by a hospital located in Puerto Rico. (2) Rural provider In the case of designated health services furnished in a rural area (as defined in section 1395ww(d)(2)(D) of this title) by an entity, if substantially all of the designated health services furnished by such entity are furnished to individuals residing in such a rural area. (3) Hospital ownership In the case of designated health services provided by a hospital (other than a hospital described in paragraph (1)) if-- (A) the referring physician is authorized to perform services at the hospital, and (B) the ownership or investment interest is in the hospital itself (and not merely in a subdivision of the hospital). (e) Exceptions relating to other compensation arrangements The following shall not be considered to be a compensation arrangement described in subsection (a)(2)(B) of this section: (1) Rental of office space; rental of equipment (A) Office space Payments made by a lessee to a lessor for the use of premises if-- (i) the lease is set out in writing, signed by the parties, and specifies the premises covered by the lease, (ii) the space rented or leased does not exceed that which is reasonable and necessary for the legitimate business purposes of the lease or rental and is used exclusively by the lessee when being used by the lessee, except that the lessee may make payments for the use of space consisting of common areas if such payments do not exceed the lessee's pro rata share of expenses for such space based upon the ratio of the space used exclusively by the lessee to the total amount of space (other than common areas) occupied by all persons using such common areas, (iii) the lease provides for a term of rental or lease for at least 1 year, (iv) the rental charges over the term of the lease are set in advance, are consistent with fair market value, and are not determined in a manner that takes into account the volume or value of any referrals or other business generated between the parties, (v) the lease would be commercially reasonable even if no referrals were made between the parties, and (vi) the lease meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse. (B) Equipment Payments made by a lessee of equipment to the lessor of the equipment for the use of the equipment if-- (i) the lease is set out in writing, signed by the parties, and specifies the equipment covered by the lease, (ii) the equipment rented or leased does not exceed that which is reasonable and necessary for the legitimate business purposes of the lease or rental and is used exclusively by the lessee when being used by the lessee, (iii) the lease provides for a term of rental or lease of at least 1 year, (iv) the rental charges over the term of the lease are set in advance, are consistent with fair market value, and are not determined in a manner that takes into account the volume or value of any referrals or other business generated between the parties, (v) the lease would be commercially reasonable even if no referrals were made between the parties, and (vi) the lease meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse. (2) Bona fide employment relationships Any amount paid by an employer to a physician (or an immediate family member of such physician) who has a bona fide employment relationship with the employer for the provision of services if-- (A) the employment is for identifiable services, (B) the amount of the remuneration under the employment-- (i) is consistent with the fair market value of the services, and (ii) is not determined in a manner that takes into account (directly or indirectly) the volume or value of any referrals by the referring physician, (C) the remuneration is provided pursuant to an agreement which would be commercially reasonable even if no referrals were made to the employer, and (D) the employment meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse. Subparagraph (B)(ii) shall not prohibit the payment of remuneration in the form of a productivity bonus based on services performed personally by the physician (or an immediate family member of such physician). (3) Personal service arrangements (A) In general Remuneration from an entity under an arrangement (including remuneration for specific physicians' services furnished to a nonprofit blood center) if-- (i) the arrangement is set out in writing, signed by the parties, and specifies the services covered by the arrangement, (ii) the arrangement covers all of the services to be provided by the physician (or an immediate family member of such physician) to the entity, (iii) the aggregate services contracted for do not exceed those that are reasonable and necessary for the legitimate business purposes of the arrangement, (iv) the term of the arrangement is for at least 1 year, (v) the compensation to be paid over the term of the arrangement is set in advance, does not exceed fair market value, and except in the case of a physician incentive plan described in subparagraph (B), is not determined in a manner that takes into account the volume or value of any referrals or other business generated between the parties, (vi) the services to be performed under the arrangement do not involve the counseling or promotion or a business arrangement or other activity that violates any State or Federal law, and (vii) the arrangement meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse. (B) Physician incentive plan exception (i) In general In the case of a physician incentive plan (as defined in clause (ii)) between a physician and an entity, the compensation may be determined in a manner (through a withhold, capitation, bonus, or otherwise) that takes into account directly or indirectly the volume or value of any referrals or other business generated between the parties, if the plan meets the following requirements: (I) No specific payment is made directly or indirectly under the plan to a physician or a physician group as an inducement to reduce or limit medically necessary services provided with respect to a specific individual enrolled with the entity. (II) In the case of a plan that places a physician or a physician group at substantial financial risk as determined by the Secretary pursuant to section 1395mm(i)(8)(A)(ii) of this title, the plan complies with any requirements the Secretary may impose pursuant to such section. (III) Upon request by the Secretary, the entity provides the Secretary with access to descriptive information regarding the plan, in order to permit the Secretary to determine whether the plan is in compliance with the requirements of this clause. (ii) ``Physician incentive plan'' defined For purposes of this subparagraph, the term ``physician incentive plan'' means any compensation arrangement between an entity and a physician or physician group that may directly or indirectly have the effect of reducing or limiting services provided with respect to individuals enrolled with the entity. (4) Remuneration unrelated to the provision of designated health services In the case of remuneration which is provided by a hospital to a physician if such remuneration does not relate to the provision of designated health services. (5) Physician recruitment In the case of remuneration which is provided by a hospital to a physician to induce the physician to relocate to the geographic area served by the hospital in order to be a member of the medical staff of the hospital, if-- (A) the physician is not required to refer patients to the hospital, (B) the amount of the remuneration under the arrangement is not determined in a manner that takes into account (directly or indirectly) the volume or value of any referrals by the referring physician, and (C) the arrangement meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse. (6) Isolated transactions In the case of an isolated financial transaction, such as a one- time sale of property or practice, if-- (A) the requirements described in subparagraphs (B) and (C) of paragraph (2) are met with respect to the entity in the same manner as they apply to an employer, and (B) the transaction meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse. (7) Certain group practice arrangements with a hospital (A) \2\ In general --------------------------------------------------------------------------- \2\ So in original. No subpar. (B) has been enacted. --------------------------------------------------------------------------- An arrangement between a hospital and a group under which designated health services are provided by the group but are billed by the hospital if-- (i) with respect to services provided to an inpatient of the hospital, the arrangement is pursuant to the provision of inpatient hospital services under section 1395x(b)(3) of this title. (ii) the arrangement began before December 19, 1989, and has continued in effect without interruption since such date, (iii) with respect to the designated health services covered under the arrangement, substantially all of such services furnished to patients of the hospital are furnished by the group under the arrangement, (iv) the arrangement is pursuant to an agreement that is set out in writing and that specifies the services to be provided by the parties and the compensation for services provided under the agreement, (v) the compensation paid over the term of the agreement is consistent with fair market value and the compensation per unit of services is fixed in advance and is not determined in a manner that takes into account the volume or value of any referrals or other business generated between the parties, (vi) the compensation is provided pursuant to an agreement which would be commercially reasonable even if no referrals were made to the entity, and (vii) the arrangement between the parties meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse. (8) Payments by a physician for items and services Payments made by a physician-- (A) to a laboratory in exchange for the provision of clinical laboratory services, or (B) to an entity as compensation for other items or services if the items or services are furnished at a price that is consistent with fair market value. (f) Reporting requirements Each entity providing covered items or services for which payment may be made under this subchapter shall provide the Secretary with the information concerning the entity's ownership, investment, and compensation arrangements, including-- (1) the covered items and services provided by the entity, and (2) the names and unique physician identification numbers of all physicians with an ownership or investment interest (as described in subsection (a)(2)(A) of this section), or with a compensation arrangement (as described in subsection (a)(2)(B) of this section), in the entity, or whose immediate relatives have such an ownership or investment interest or who have such a compensation relationship with the entity. Such information shall be provided in such form, manner, and at such times as the Secretary shall specify. The requirement of this subsection shall not apply to designated health services provided outside the United States or to entities which the Secretary determines provides \3\ services for which payment may be made under this subchapter very infrequently. --------------------------------------------------------------------------- \3\ So in original. Probably should be ``provide''. --------------------------------------------------------------------------- (g) Sanctions (1) Denial of payment No payment may be made under this subchapter for a designated health service which is provided in violation of subsection (a)(1) of this section. (2) Requiring refunds for certain claims If a person collects any amounts that were billed in violation of subsection (a)(1) of this section, the person shall be liable to the individual for, and shall refund on a timely basis to the individual, any amounts so collected. (3) Civil money penalty and exclusion for improper claims Any person that presents or causes to be presented a bill or a claim for a service that such person knows or should know is for a service for which payment may not be made under paragraph (1) or for which a refund has not been made under paragraph (2) shall be subject to a civil money penalty of not more than $15,000 for each such service. The provisions of section 1320a-7a of this title (other than the first sentence of subsection (a) and other than subsection (b)) shall apply to a civil money penalty under the previous sentence in the same manner as such provisions apply to a penalty or proceeding under section 1320a-7a(a) of this title. (4) Civil money penalty and exclusion for circumvention schemes Any physician or other entity that enters into an arrangement or scheme (such as a cross-referral arrangement) which the physician or entity knows or should know has a principal purpose of assuring referrals by the physician to a particular entity which, if the physician directly made referrals to such entity, would be in violation of this section, shall be subject to a civil money penalty of not more than $100,000 for each such arrangement or scheme. The provisions of section 1320a-7a of this title (other than the first sentence of subsection (a) and other than subsection (b)) shall apply to a civil money penalty under the previous sentence in the same manner as such provisions apply to a penalty or proceeding under section 1320a-7a(a) of this title. (5) Failure to report information Any person who is required, but fails, to meet a reporting requirement of subsection (f) of this section is subject to a civil money penalty of not more than $10,000 for each day for which reporting is required to have been made. The provisions of section 1320a-7a of this title (other than the first sentence of subsection (a) and other than subsection (b)) shall apply to a civil money penalty under the previous sentence in the same manner as such provisions apply to a penalty or proceeding under section 1320a- 7a(a) of this title. (6) Advisory opinions (A) In general The Secretary shall issue written advisory opinions concerning whether a referral relating to designated health services (other than clinical laboratory services) is prohibited under this section. Each advisory opinion issued by the Secretary shall be binding as to the Secretary and the party or parties requesting the opinion. (B) Application of certain rules The Secretary shall, to the extent practicable, apply the rules under subsections (b)(3) and (b)(4) of this section and take into account the regulations promulgated under subsection (b)(5) of section 1320a-7d of this title in the issuance of advisory opinions under this paragraph. (C) Regulations In order to implement this paragraph in a timely manner, the Secretary may promulgate regulations that take effect on an interim basis, after notice and pending opportunity for public comment. (D) Applicability This paragraph shall apply to requests for advisory opinions made after the date which is 90 days after August 5, 1997, and before the close of the period described in section 1320a- 7d(b)(6) of this title. (h) Definitions and special rules For purposes of this section: (1) Compensation arrangement; remuneration (A) The term ``compensation arrangement'' means any arrangement involving any remuneration between a physician (or an immediate family member of such physician) and an entity other than an arrangement involving only remuneration described in subparagraph (C). (B) The term ``remuneration'' includes any remuneration, directly or indirectly, overtly or covertly, in cash or in kind. (C) Remuneration described in this subparagraph is any remuneration consisting of any of the following: (i) The forgiveness of amounts owed for inaccurate tests or procedures, mistakenly performed tests or procedures, or the correction of minor billing errors. (ii) The provision of items, devices, or supplies that are used solely to-- (I) collect, transport, process, or store specimens for the entity providing the item, device, or supply, or (II) order or communicate the results of tests or procedures for such entity. (iii) A payment made by an insurer or a self-insured plan to a physician to satisfy a claim, submitted on a fee for service basis, for the furnishing of health services by that physician to an individual who is covered by a policy with the insurer or by the self-insured plan, if-- (I) the health services are not furnished, and the payment is not made, pursuant to a contract or other arrangement between the insurer or the plan and the physician, (II) the payment is made to the physician on behalf of the covered individual and would otherwise be made directly to such individual, (III) the amount of the payment is set in advance, does not exceed fair market value, and is not determined in a manner that takes into account directly or indirectly the volume or value of any referrals, and (IV) the payment meets such other requirements as the Secretary may impose by regulation as needed to protect against program or patient abuse. (2) Employee An individual is considered to be ``employed by'' or an ``employee'' of an entity if the individual would be considered to be an employee of the entity under the usual common law rules applicable in determining the employer-employee relationship (as applied for purposes of section 3121(d)(2) of the Internal Revenue Code of 1986). (3) Fair market value The term ``fair market value'' means the value in arms length transactions, consistent with the general market value, and, with respect to rentals or leases, the value of rental property for general commercial purposes (not taking into account its intended use) and, in the case of a lease of space, not adjusted to reflect the additional value the prospective lessee or lessor would attribute to the proximity or convenience to the lessor where the lessor is a potential source of patient referrals to the lessee. (4) Group practice (A) Definition of group practice The term ``group practice'' means a group of 2 or more physicians legally organized as a partnership, professional corporation, foundation, not-for-profit corporation, faculty practice plan, or similar association-- (i) in which each physician who is a member of the group provides substantially the full range of services which the physician routinely provides, including medical care, consultation, diagnosis, or treatment, through the joint use of shared office space, facilities, equipment and personnel, (ii) for which substantially all of the services of the physicians who are members of the group are provided through the group and are billed under a billing number assigned to the group and amounts so received are treated as receipts of the group, (iii) in which the overhead expenses of and the income from the practice are distributed in accordance with methods previously determined, (iv) except as provided in subparagraph (B)(i), in which no physician who is a member of the group directly or indirectly receives compensation based on the volume or value of referrals by the physician, (v) in which members of the group personally conduct no less than 75 percent of the physician-patient encounters of the group practice, and (vi) which meets such other standards as the Secretary may impose by regulation. (B) Special rules (i) Profits and productivity bonuses A physician in a group practice may be paid a share of overall profits of the group, or a productivity bonus based on services personally performed or services incident to such personally performed services, so long as the share or bonus is not determined in any manner which is directly related to the volume or value of referrals by such physician. (ii) Faculty practice plans In the case of a faculty practice plan associated with a hospital, institution of higher education, or medical school with an approved medical residency training program in which physician members may provide a variety of different specialty services and provide professional services both within and outside the group, as well as perform other tasks such as research, subparagraph (A) shall be applied only with respect to the services provided within the faculty practice plan. (5) Referral; referring physician (A) Physicians' services Except as provided in subparagraph (C), in the case of an item or service for which payment may be made under part B of this subchapter, the request by a physician for the item or service, including the request by a physician for a consultation with another physician (and any test or procedure ordered by, or to be performed by (or under the supervision of) that other physician), constitutes a ``referral'' by a ``referring physician''. (B) Other items Except as provided in subparagraph (C), the request or establishment of a plan of care by a physician which includes the provision of the designated health service constitutes a ``referral'' by a ``referring physician''. (C) Clarification respecting certain services integral to a consultation by certain specialists A request by a pathologist for clinical diagnostic laboratory tests and pathological examination services, a request by a radiologist for diagnostic radiology services, and a request by a radiation oncologist for radiation therapy, if such services are furnished by (or under the supervision of) such pathologist, radiologist, or radiation oncologist pursuant to a consultation requested by another physician does not constitute a ``referral'' by a ``referring physician''. (6) Designated health services The term ``designated health services'' means any of the following items or services: (A) Clinical laboratory services. (B) Physical therapy services. (C) Occupational therapy services. (D) Radiology services, including magnetic resonance imaging, computerized axial tomography scans, and ultrasound services. (E) Radiation therapy services and supplies. (F) Durable medical equipment and supplies. (G) Parenteral and enteral nutrients, equipment, and supplies. (H) Prosthetics, orthotics, and prosthetic devices and supplies. (I) Home health services. (J) Outpatient prescription drugs. (K) Inpatient and outpatient hospital services. (Aug. 14, 1935, ch. 531, title XVIII, Sec. 1877, as added Pub. L. 101- 239, title VI, Sec. 6204(a), Dec. 19, 1989, 103 Stat. 2236; amended Pub. L. 101-508, title IV, Sec. 4207(e)(1)-(3), (k)(2), formerly Sec. 4027(e)(1)-(3), (k)(2), Nov. 5, 1990, 104 Stat. 1388-121, 1388-122, 1388-124, renumbered Pub. L. 103-432, title I, Sec. 160(d)(4), Oct. 31, 1994, 108 Stat. 4444; Pub. L. 103-66, title XIII, Sec. 13562(a), Aug. 10, 1993, 107 Stat. 596; Pub. L. 103-432, title I, Sec. 152(a), (b), Oct. 31, 1994, 108 Stat. 4436; Pub. L. 105-33, title IV, Sec. 4314, Aug. 5, 1997, 111 Stat. 389; Pub. L. 106-113, div. B, Sec. 1000(a)(6) [title V, Sec. 524(a)], Nov. 29, 1999, 113 Stat. 1536, 1501A-387.) References in Text Section 222(a) of the Social Security Amendments of 1972, referred to in subsec. (b)(3)(C), is section 222(a) of Pub. L. 92-603, Oct. 30, 1972, 86 Stat. 1329, which is set out as a note under section 1395b-1 of this title. Section 300e-9(d) of this title, referred to in subsec. (b)(3)(D), was redesignated section 300e-9(c) of this title by Pub. L. 100-517, Sec. 7(b), Oct. 24, 1988, 102 Stat. 2580. Part C of this subchapter, referred to in subsec. (b)(3)(E), is classified to section 1395w-21 et seq. of this title. The Internal Revenue Code, referred to in subsecs. (c)(2) and (h)(2), is classified generally to Title 26, Internal Revenue Code. Part B of this subchapter, referred to in subsec. (h)(5)(A), is classified to section 1395j et seq. of this title. Prior Provisions A prior section 1395nn, act Aug. 14, 1935, ch. 531, title XVIII, Sec. 1877, as added and amended Oct. 30, 1972, Pub. L. 92-603, title II, Secs. 242(b), 278(b)(8), 86 Stat. 1419, 1454; Oct. 25, 1977, Pub. L. 95- 142, Sec. 4(a), 91 Stat. 1179; Dec. 5, 1980, Pub. L. 96-499, title IX, Sec. 917, 94 Stat. 2625; July 18, 1984, Pub. L. 98-369, div. B, title III, Sec. 2306(f)(2), 98 Stat. 1073; Oct. 21, 1986, Pub. L. 99-509, title IX, Sec. 9321(a)(1), 100 Stat. 2016; Aug. 18, 1987, Pub. L. 100- 93, Sec. 4(c), 101 Stat. 689, enumerated offenses relating to the Medicare program and penalties for such offenses, prior to repeal by Pub. L. 100-93, Secs. 4(e), 15(a), Aug. 18, 1987, 101 Stat. 689, 698, effective at end of fourteen-day period beginning Aug. 18, 1987, and inapplicable to administrative proceedings commenced before end of such period. Amendments 1999--Subsec. (b)(3)(C). Pub. L. 106-113, Sec. 1000(a)(6) [title V, Sec. 524(a)(1)], struck out ``or'' at the end. Subsec. (b)(3)(D). Pub. L. 106-113, Sec. 1000(a)(6) [title V, Sec. 524(a)(2)], substituted ``, or'' for period at end. Subsec. (b)(3)(E). Pub. L. 106-113, Sec. 1000(a)(6) [title V, Sec. 524(a)(3)], which directed addition of provisions at end of par. (3) but which separated directory language from language to be added because of the apparent placement out of sequence of pars. (2) and (3) of Sec. 524(a), was executed by adding subpar. (E) at end of par. (3) to reflect the probable intent of Congress. 1997--Subsec. (g)(6). Pub. L. 105-33 added par. (6). 1994--Subsec. (f). Pub. L. 103-432, Sec. 152(a)(1), (4), (5), in introductory provisions, substituted ``ownership, investment, and compensation arrangements'' for ``ownership arrangements'', and in closing provisions, substituted ``designated health services'' for ``covered items and services'' and struck out ``Such information shall first be provided not later than October 1, 1991.'' after ``shall specify.'' and ``The Secretary may waive the requirements of this subsection (and the requirements of chapter 35 of title 44 with respect to information provided under this subsection) with respect to reporting by entities in a State (except for entities providing designated health services) so long as such reporting occurs in at least 10 States, and the Secretary may waive such requirements with respect to the providers in a State required to report so long as such requirements are not waived with respect to parenteral and enteral suppliers, end stage renal disease facilities, suppliers of ambulance services, hospitals, entities providing physical therapy services, and entities providing diagnostic imaging services of any type.'' at end. Subsec. (f)(2). Pub. L. 103-432, Sec. 152(a)(2), (3), inserted ``, or with a compensation arrangement (as described in subsection (a)(2)(B) of this section),'' after ``investment interest (as described in subsection (a)(2)(A) of this section)'' and ``interest or who have such a compensation relationship with the entity'' before period at end. Subsec. (h)(6). Pub. L. 103-432, Sec. 152(b), in subpar. (D), substituted ``services, including magnetic resonance imaging, computerized axial tomography scans, and ultrasound services'' for ``or other diagnostic services'', and in subpars. (E), (F), and (H), inserted ``and supplies'' before period at end. 1993--Subsecs. (a) to (e). Pub. L. 103-66, Sec. 13562(a)(1), amended headings and text of subsecs. (a) to (e) generally, substituting present provisions for provisions which related to: prohibition of certain referrals in subsec. (a), general exceptions to both ownership and compensation arrangement prohibitions in subsec. (b), general exception related only to ownership or investment prohibition for ownership in publicly-traded securities in subsec. (c), additional exceptions related only to ownership or investment prohibition in subsec. (d), and exceptions relating to other compensation arrangements in subsec. (e). Subsec. (f). Pub. L. 103-66, Sec. 13562(a)(3), substituted ``designated health services'' for ``clinical laboratory services'' in concluding provisions. Subsec. (g)(1). Pub. L. 103-66, Sec. 13562(a)(4), substituted ``designated health service'' for ``clinical laboratory service''. Subsec. (h). Pub. L. 103-66, Sec. 13562(a)(2), amended heading and text of subsec. (h) generally, substituting pars. (1) to (6) for former pars. (1) to (7) which defined ``compensation arrangement'', ``remuneration'', ``employee'', ``fair market value'', ``group practice'', ``investor'', ``interested investor'', ``disinterested investor'', ``referral'', and ``referring physician''. 1990--Subsec. (b)(4), (5). Pub. L. 101-508, Sec. 4207(e)(2), formerly Sec. 4027(e)(2), as renumbered by Pub. L. 103-432, Sec. 160(d)(4), added par. (4) and redesignated former par. (4) as (5). Subsec. (f). Pub. L. 101-508, Sec. 4207(e)(3)(B), (C), formerly Sec. 4027(e)(3)(B), (C), as renumbered by Pub. L. 103-432, Sec. 160(d)(4), substituted ``October 1, 1991'' for ``1 year after December 19, 1989'' in second sentence and inserted at end ``The requirement of this subsection shall not apply to covered items and services provided outside the United States or to entities which the Secretary determines provides services for which payment may be made under this subchapter very infrequently. The Secretary may waive the requirements of this subsection (and the requirements of chapter 35 of title 44 with respect to information provided under this subsection) with respect to reporting by entities in a State (except for entities providing clinical laboratory services) so long as such reporting occurs in at least 10 States, and the Secretary may waive such requirements with respect to the providers in a State required to report so long as such requirements are not waived with respect to parenteral and enteral suppliers, end stage renal disease facilities, suppliers of ambulance services, hospitals, entities providing physical therapy services, and entities providing diagnostic imaging services of any type.'' Subsec. (f)(2). Pub. L. 101-508, Sec. 4207(e)(3)(A), formerly Sec. 4027(e)(3)(A), as renumbered by Pub. L. 103-432, Sec. 160(d)(4), amended par. (2) generally. Prior to amendment, par. (2) read as follows: ``the names and all of the medicare provider numbers of the physicians who are interested investors or who are immediate relatives of interested investors.'' Subsec. (g)(5). Pub. L. 101-508, Sec. 4207(k)(2), formerly Sec. 4027(k)(2), as renumbered by Pub. L. 103-432, Sec. 160(d)(4), inserted at end ``The provisions of section 1320a-7a of this title (other than the first sentence of subsection (a) and other than subsection (b)) shall apply to a civil money penalty under the previous sentence in the same manner as such provisions apply to a penalty or proceeding under section 1320a-7a(a) of this title.'' Subsec. (h)(6). Pub. L. 101-508, Sec. 4207(e)(1)(C), formerly Sec. 4027(e)(1)(C), as renumbered by Pub. L. 103-432, Sec. 160(d)(4), added par. (6). Former par. (6) redesignated (7). Pub. L. 101-508, Sec. 4207(e)(1)(A), (B), formerly Sec. 4027(e)(1)(A), (B), as renumbered by Pub. L. 103-432, Sec. 160(d)(4), substituted ``in the case of an item or service for which payment may be made under part B of this subchapter, the request by a physician for the item or service,'' for ``in the case of a clinical laboratory service which under law is required to be provided by (or under the supervision of) a physician, the request by a physician for the service,'' in subpar. (A) and struck out ``in the case of another clinical laboratory service,'' after ``subparagraph (C),'' in subpar. (B). Subsec. (h)(7). Pub. L. 101-508, Sec. 4207(e)(1)(C), formerly Sec. 4027(e)(1)(C), as renumbered by Pub. L. 103-432, Sec. 160(d)(4), redesignated par. (6) as (7). Effective Date of 1999 Amendment Pub. L. 106-113, div. B, Sec. 1000(a)(6) [title V, Sec. 524(b)], Nov. 29, 1999, 113 Stat. 1536, 1501A-388, provided that: ``The amendment made by this section [amending this section] shall apply to services furnished on or after the date of the enactment of this Act [Nov. 29, 1999].'' Effective Date of 1994 Amendment Section 152(d)(1) of Pub. L. 103-432 provided that: ``The amendments made by subsections (a) and (b) [amending this section] shall apply to referrals made on or after January 1, 1995.'' Effective Date of 1993 Amendment Section 13562(b) of Pub. L. 103-66, as amended by Pub. L. 103-432, title I, Sec. 152(c), Oct. 31, 1994, 108 Stat. 4437, provided that: ``(1) In general.--Except as provided in paragraph (2), the amendments made by this section [amending this section] shall apply to referrals-- ``(A) made on or after January 1, 1992, in the case of clinical laboratory services, and ``(B) made after December 31, 1994, in the case of other designated health services. ``(2) Exceptions.--With respect to referrals made for clinical laboratory services on or before December 31, 1994-- ``(A) the second sentence of subsection (a)(2), and subsections (b)(2)(B) and (d)(2), of section 1877 of the Social Security Act [subsecs. (a)(2), (b)(2)(B), and (d)(2) of this section] (as in effect on the day before the date of the enactment of this Act [Aug. 10, 1993]) shall apply instead of the corresponding provisions in section 1877 (as amended by this Act); ``(B) section 1877(b)(4) of the Social Security Act [subsec. (b)(4) of this section] (as in effect on the day before the date of the enactment of this Act) shall apply; ``(C) the requirements of section 1877(c)(2) of the Social Security Act [subsec. (c)(2) of this section] (as amended by this Act) shall not apply to any securities of a corporation that meets the requirements of section 1877(c)(2) of the Social Security Act (as in effect on the day before the date of the enactment of this Act); ``(D) section 1877(e)(3) of the Social Security Act [subsec. (e)(3) of this section] (as amended by this Act) shall apply, except that it shall not apply to any arrangement that meets the requirements of subsection (e)(2) or subsection (e)(3) of section 1877 of the Social Security Act (as in effect on the day before the date of the enactment of this Act); ``(E) the requirements of clauses (iv) and (v) of section 1877(h)(4)(A), and of clause (i) of section 1877(h)(4)(B), of the Social Security Act [subsec. (h)(4)(A)(iv), (v), (B)(i) of this section] (as amended by this Act) shall not apply; and ``(F) section 1877(h)(4)(B) of the Social Security Act [subsec. (h)(4)(B) of this section] (as in effect on the day before the date of the enactment of this Act) shall apply instead of section 1877(h)(4)(A)(ii) of such Act (as amended by this Act).'' [Section 152(d)(2) of Pub. L. 103-432 provided that: ``The amendment made by subsection (c) [amending section 13562(b) of Pub. L. 103-66, set out above] shall apply as if included in the enactment of OBRA-1993 [Pub. L. 103-66].''] Effective Date of 1990 Amendment Section 4207(e)(5), formerly 4027(e)(5), of Pub. L. 101-508, as renumbered by Pub. L. 103-432, title I, Sec. 160(d)(4), Oct. 31, 1994, 108 Stat. 4444, provided that: ``The amendments made by this subsection [amending this section and provisions set out below] shall be effective as if included in the enactment of section 6204 of the Omnibus Budget Reconciliation Act of 1989 [Pub. L. 101-239].'' Effective Date Section 6204(c) of Pub. L. 101-239 provided that: ``(1) Except as provided in paragraph (2), the amendments made by this section [enacting this section and amending section 1395l of this title] shall become effective with respect to referrals made on or after January 1, 1992. ``(2) The reporting requirement of section 1877(f) of the Social Security Act [subsec. (f) of this section] shall take effect on October 1, 1990.'' Deadline for Certain Regulations Section 6204(d) of Pub. L. 101-239, as amended by Pub. L. 101-508, title IV, Sec. 4207(e)(4)(B), formerly Sec. 4027(e)(4)(B), Nov. 5, 1990, 104 Stat. 1388-122, renumbered Pub. L. 103-432, title I, Sec. 160(d)(4), Oct. 31, 1994, 108 Stat. 4444, provided that: ``The Secretary of Health and Human Services shall publish final regulations to carry out section 1877 of the Social Security Act [this section] by not later than October 1, 1991.'' GAO Study of Ownership by Referring Physicians Section 6204(e) of Pub. L. 101-239 directed Comptroller General to conduct a study of ownership of hospitals and other providers of medicare services by referring physicians and, by not later than Feb. 1, 1991, report to Congress on results of such study, prior to repeal by Pub. L. 104-316, title I, Sec. 122(h)(1), Oct. 19, 1996, 110 Stat. 3837. Statistical Summary of Comparative Utilization Section 6204(f) of Pub. L. 101-239, as amended by Pub. L. 101-508, title IV, Sec. 4207(e)(4)(A), formerly Sec. 4027(e)(4)(A), Nov. 5, 1990, 104 Stat. 1388-122, renumbered Pub. L. 103-432, title I, Sec. 160(d)(4), Oct. 31, 1994, 108 Stat. 4444; Pub. L. 104-316, title I, Sec. 122(h)(2), Oct. 19, 1996, 110 Stat. 3837, directed Secretary of Health and Human Services, not later than June 30, 1992, to submit to Congress a statistical profile comparing utilization of items and services by medicare beneficiaries served by entities in which the referring physician has a direct or indirect financial interest and by medicare beneficiaries served by other entities, for the States and entities specified in subsec. (f) of this section (other than entities providing clinical laboratory services). Section Referred to in Other Sections This section is referred to in section 1396b of this title.
| Source: U.S. Code (January 23, 2000) |