Chapter 7 Federal Statutes and Regulations That Impact Healthcare 123 Copyright Goodheart-Willcox Co., Inc. The Stark Anti-Referral Law governs phy- sician self-referral for healthcare services. The law prohibits physicians from referring Medi- care and Medicaid patients to any organization that the doctor or his or her immediate family has a financial relationship with, unless an exception applies. The belief is that a physician may not make the best medical decision if he or she has an economic interest. If a physician violates this law, he or she may have to pay up to $15,000 in penalties for each claim and three times the amount of the improper collection. Violations of the False Claim Act may also come into play in these situations. Mandatory exceptions to this law were created to promote patient convenience, efficiency, and care continuity. So, for example, if a physician is part of a group practice, there is an exception that allows the physician to refer patients to pro- viders and services within the group. The Health Insurance Portability and Accountability Act (HIPAA) The Health Insurance Portability and Accountability Act (HIPAA) includes the Privacy Rule and the Security Rule. HIPAA provides federal protections for personal health information (PHI) held by covered enti- ties and provides patients with rights related to their health information (Figure 7.5). These rights include patients determining who can view and receive their health information. At the same time, the Privacy Rule permits the disclosure of PHI that is needed for patient care and other important purposes. The original intentions of this legislation were the standardization and simplification of information transmission and cost savings. HIPAA applies to all forms of individuals’ PHI, including oral, written, and electronic. If an entity is not covered, it does not have to comply with HIPAA’s Privacy Rule or the Security Rule. Examples of non-covered entities include employers, many schools, law enforcement agencies, state agen- cies (such as child protective services), and life insurance carriers. Health insurers and providers who are covered entities must com- ply with patients’ rights to · ask to see and/or receive a copy of their health records · have corrections incorporated into their health records Health Insurance Portability and Accountability Act (HIPAA) law that aims to protect the confidentiality and security of healthcare information and help control administrative costs Image Point Fr/Shutterstock.com Figure 7.4 It is illegal for physicians to make promises of sales to pharmaceutical representatives in exchange for money. What problems might that kind of corruption cause?