Practical applications of Stark II to hospital operations.

With the passage of the Omnibus Reconciliation Act of 1993, the Social Security Act was amended to substantially expand the Medicare self-referral prohibitions. The amended statute, commonly referred to as "Stark II," now covers Medicare and Medicaid referrals and substantially expands the list of services covered, effective January 1, 1995. This article illustrates how Stark II may apply to some of the most common financial relationships between hospitals and referring physicians.