Does the Stark law apply to a counselor I employ?

Under the Stark law, a physician who has a financial relationship with an entity, or whose immediate family member has a financial relationship with the entity, may not make a referral to that entity for "designated health services" covered under Medicare or Medicaid unless an exception applies.

The Stark law is not applicable to either arrangement you describe. Because counseling for stress or pain management is not one of the designated health services, Stark would not prohibit your referral of a patient to a counselor who is either employed directly by you or employed by the same group practice. Psychological counseling performed as an inpatient or outpatient hospital service or a physician's prescribing of outpatient drugs could however trigger the Stark law.

If the counselor is employed by you, Stark would not prevent you from billing for the counselor's services under your tax ID number; however, if you bill the services as "incident-to" services, make sure you are complying with applicable Medicare coverage rules. Also, remember that a qualified psychologist can obtain an independent provider number and bill at 100 percent of the fee schedule.