New Stark regs refine "same building" rules

Contract Language. By Steven M. Harris, amednews contributor. July 5, 2004.

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In its second phase of Stark II self-referral regulations, due to take effect July 26, the Centers for Medicare & Medicaid Services included new "same building" tests that physicians must meet in order to receive reimbursement for designated health services.

The new Stark II regulations modify the previous same-building test for designated health services such as lab work, imaging and various therapies by establishing three alternative tests, each of which requires the referring physician or group practice to maintain an office in the building where the services are provided and satisfy parameters relating to hours and physician services. Physicians have to satisfy the requirements of one of the three tests to meet the same-building requirement.

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The first test generally applies when the building in which the physicians are practicing and providing services is the principal place of practice for the physicians and their group. A designated health service is considered to be furnished in the same building under the first alternative test if the building is one in which the referring physician or his or her group practice has an office that is normally open to their patients at least 35 hours per week, and the referring physician or one or more members of his or her group regularly practices medicine and furnishes physician services to patients in that office at least 30 hours per week.

Some of the services must be physician services that are unrelated to the furnished service, although the unrelated services may lead to the ordering of designated health services.

The second test describes a building in which a referring physician practices medicine at least one day per week and is the principal place where the physician's patients receive physician services. A designated health service is furnished in the same building under the second alternative test if all of the following requirements are satisfied:

The building is one in which the referring physician or his or her group practice owns or rents an office that is normally open to their patients at least eight hours per week.
The referring physician regularly practices medicine and furnishes physician services to his or her patients in that office building at least six hours per week (including some physician services unrelated to the furnishing of designated health services). In this test, services provided by other members of the referring physician's group practice do not count toward the six-hour threshold.
The building must be one in which the patient receiving the designated health service usually sees the referring physician or other members of his or her group practice.

The third test applies when referring physicians or group practice members provide physician services to patients at least one day per week, and designated health services are ordered during a patient visit, or the physicians are present during the provision of those services. Under the third test, services are furnished in the same building by fulfilling the same requirements from the second test regarding physician operation and presence in the building.

Also, either the referring physician must be present and order the designated health service in connection with a patient visit during the time the office is open in the building, or the referring physician or a member of the group practice must be present while the service is furnished during the time the office is open in the building. This test requires presence in the building, but not necessarily in the same space or part of the building.

Stay tuned for next month's column, which will discuss physician recruitment contracts in light of the new Stark II regulations.

Harris, a partner at McDonald Hopkins in Chicago, concentrates on health care law and has counseled physicians, physician networks and health care groups nationally. The author and publisher are not rendering professional advice and assume no liability in connection with its use. He can be reached at 312-280-0111, or by email (sharris@mcdonaldhopkins.com).