Health insurance and healthcare organizations have a tremendous obligation under the Stark laws regarding physician and provider agreements, in particular compensation.

Violation consequences can be quite severe including:

  • Banned participation from Medicare/Medicaid
  • Up to $100,000 penalty per claim
  • Fines under the False Claims Act
  • High litigation expense
  • Loss of revenue from referrals that violate Stark

A few things to be aware of:


  1. There are typically large numbers of agreements that need to be tracked anywhere from 15,000-20,000 for a local company to much more for a regional or national organization.   These agreements can be extremely lengthy and complex with challenging formatting such as advanced numbering, sub-numbering, appendix numbering. 
  2. There are also a large numbers of appendices covering different options.  These may include pricing and optional services (i.e. vision, dental, dental HMO). 
  3. Perhaps most importantly, there is significant governance, internal and external that is required on the template, agreement creation, approval, credential tracking and execution. 
  4. Reporting is a significant governance topic all by itself.  Expiring credentials, expiring certificates, expiring contracts are all critical to be tracked.  Even when a contract is in place you need to be able to track when a clause is outdated and an amendment needs to be filed.  There is also a general requirement to track and report on both the clause version and the “form”.  “Form” being the insurance term for the document as it is approved by the insurance commissioner.


The good news?  Ariba Contracts can handle all Stark contract concerns in an easy-to-use solution that automates the entire process.  And because it's delivered in the Cloud, deployment is fast so your exposure is minimized and your process is streamlined.