This one is simple: Physicians cannot refer medicaid or medicare clients to any "entity" they have a financial relationship with.
Here a "financial relationship" includes any form of compensation, investment or level of ownership between the provider (or his immediate family) and an entity.
These entities include labs, imaging providers, pharmacies, physical therapy treatments, etc.
If Dr X refers a pt to a podiatrist who pays him a percentage of the visit cost or any similar scenario, he is in violation.
If he sends the pt to a lab his wife owns, he is in violation.
If he sends them to get an x-ray at a place that gives him ten dollars per referral, he is in violation.
If he he shouts his intention to do so in a crowded room, he is not in violation.
This is because the SL is only prosecutable if actually done - not if intended to. This type of law is called "Strict Liability". Intent is immaterial.
So he could, in theory, accidentally violate it by losing track of which of his provider buddies owe him money.
Breaking the Stark Law (also known as the Physician Self-Referral Law) itself does not lead to criminal charges only civil penalties. It is enforced by the OIG (Office of The Inspector General) and comes with fines, recoupments, and exclusions from any and all federal healthcare programs. This is serious in that the provider may never get paid by medicare again and medicare pts will have to pay you out of pocket. Dr. X is not going to keep many of these patients.
Officially it is named Section 1877 of the Social Security Act or more precisely: Sec. 1877. [42 U.S.C. 1395] (a) Prohibition of Certain Referrals.
The Stark Law - if you have the time, the exceptions section is an interesting read.
Violating the Stark Law often means violating other laws, some of which are criminal. All of these and their penalties can be seen at the OIG's Fraud and Abuse website. Any of these laws could show up as questions on a coding exam. More, they are important for a coder to know. Please review the included websites as part of your study plan.
In short:
False Claims Act - This is important to know. The site reads: "It is illegal to submit claims for payment to Medicare or Medicaid that you know or should know are false or fraudulent. " This is a criminal as well as civil law. Note the phrase "or should know". This is further clarified with : "The civil FCA defines "knowing" to include not only actual knowledge but also instances in which the person acted in deliberate ignorance or reckless disregard of the truth or falsity of the information. " Intent is important here.
Anti-Kickback Statute - This one is criminal and can result in jail time. Also can be fined fifty thousand PLUS three times what was given. It includes both the giver and receiver of any sort of bribe to get/give business covered by any federal healthcare program. Cash, excessively well paid speaking gigs, jewelry, meals, vacations, RVs, Birken bags, anything at all. Note: "The Government does not need to prove patient harm or financial loss to the programs to show that a physician violated the AKS."
Exclusion Statute - The OIG must exclude providers who violate certain laws/provisions; the excluded will not be paid by any federal program, their prescriptions and referrals will not be covered, and any clinic or other who employs them will not be able to have anything related to them covered - may also be subject to penalties, repayments and fines. The exile is a complete one.
Civil Monetary Penalties Law - States the OIG can fine anywhere from ten to fifty thousand per violation