Archive: House Committee Tables Self-Referral Bill Opposed by PAMED

Following a hearing on a new physician self referral bill, the House Insurance Committee on Professional Licensure decided to table the bill so the committee could gather more information and make necessary changes.

Pennsylvania Medical Society (PAMED) President James Goodyear, MD, testified in opposition to HB 2522 before the committee on June 8, 2010. The decision to table was made following testimony by Dr. Goodyear and other concerned parties.

“We think this is prudent action on the part of the committee,” said Dr. Goodyear.

In his comments, Dr. Goodyear said that federal Stark laws have effectively addressed abusive self-referral practices, and all that HB 2522 really accomplishes “is adding draconian state penalties and imposing a strict liability standard. In the end, physicians will have to hire attorneys to review any financial relationships to ensure compliance. More costs. More hassles. No perceived benefits—for both patients and physicians.”

House Bill 2522 would prohibit physicians from referring patients for certain services such as diagnostic imaging to an entity with which they or their immediate family members have a financial relationship. It would, however, allow referrals permitted under safe harbor regulations for the federal anti-kickback statute as well as those permitted under exceptions to the Ethics in Self-Referral Law, also known as the Stark law.

While less severe than previous proposals, the language of the bill is vague and could be interpreted more strictly than the federal Stark law. It is not clear what services would be affected and how some specialties would be impacted.

In addition, tying self referral laws in Pennsylvania to the federal law could be harmful to physicians if the Stark law is tightened in the future. 

PAMED believes that further restrictions on self referral will create more barriers to providing clinically integrated patient care.

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Comments: 13


This is maddening. How can any of you defend self referral in the context of the third party payer system. This is not about "freedom" or "free markets". This is gaming the system to increase increase your revenue. If you are able to make money by ordering a test, you will order that test as more often than you otherwise would. Self referral is a blank check that is held in place only by the concious of the practitioner. Wonder why the group of MDs that are most adept at self referral, i.e. Cardiology, has become one of the most lucrative fields of medicine?

dr.seuss at 7/26/2010 3:11:33 PM


Thank you for your representation, Dr. Goodyear. Stop the maddening abuse of physicians!

Jeff M at 6/21/2010 5:11:45 PM


When you buy a house, you have to get title insurance. Guess who owns the title insurance company? The lawyer who does the closing.

John M at 6/17/2010 4:50:05 PM


I agree with many and disagree with some. Self-referral has been up for debate for almost 30 years. Do doctors make 10, 20 or 50% of their annual W2 on ancillary self referral? Before making such broad statements outlawing such activity, why not look at the facts? How about limiting total dollars attained from ancillary services to 25%? Is that unreasonable? If the average physician between office and surgery brings in $400K, allow them $100K of ancillary - period. If the avg family doc makes $150K, limit them to $32K, and so on. Limiting opportunity by federal standards will reduce the pool of quality people entering a profession. Does your mechanic self refer? Absolutely, every time he puts in a car part! Do lawyers self refer? When is the last time your attorney didn't bring in a partner - isnt that a form of self referral?

Dr.Vinnie at 6/17/2010 12:29:49 PM


If your practice is owned by a hospital association and you send your patient for diagnostic testing to the hospital that signs your paycheck, is this not self-referral since you have a vested interest in the bottom line of your employer? How hypocritical is that? TORT REFORM is the only serious way you will control healthcare costs in the future and the lawyers turn a deaf ear of course!

anonymous at 6/10/2010 6:34:50 PM


Having practiced radiolgy for thirty years and read countless articles documenting the increased costs and abuses associated with self referrals in medical imaging, I cannot understand the reluctance of organized medicine to acknowledge the ongoing problem.I have heard the arguments regarding patient convenience and integrated care, I have also seen the substandard images produced.The time has come to eliminate any hint of financial incentives and concentrate on good quality care.

Jholstein at 6/5/2010 2:41:22 PM


ANY OTHER PROFESSION IS NOT DICTATED BY RULES LIKE THIS. WHY ARE PHYSICIANS CONSTATLY RESTRICTED AND THEIR RIGHTS ARE TAKEN AWAY. IT IS SAD. ATTORNEYS CAN BILL WHATEVER THEY PLEASE. RECENTLY I WAS A VICTIM OF A FALSE CHARGE OF A DISABLEE PERSON SAYING I WAS BILLING HER COPAY BECAUSE SHE COMPLAINED ABOUT THE RAMP TO MY OFFICE. I SPENT OVER $30,000 IN ATTORNEY FEES. THE ATTORNEY DID MOSTLY WHAT WE WROTE AND GAVE HIM TO ASK OR SAY. HE PROBABLY DID ABOUT MAXIMUM OF 4-5 HOURS OF WORK & THEY CAN BILL WHATEVER THEY PLEASE. PHYSICIANS GO THROUGH ABOUT 13 YEARS OF SCHOOL & TRAINING, BUT THEY ARE CONSTANTLY TOLD WHAT TO DO BY EVERYONE. WHEN IS THIS GOING TO END.

MICKEY at 6/4/2010 12:17:14 PM


I am surprised, as well as disappointed that PAMED would oppose such legislation. Existing practices both in the Commonwealth, as well as nationwide, that exploit the in-office ancillary exemption for services such as pathology, diagnostic radiology, and radiation oncology- are inherently unethical and illegial. Patients and payers are realizing that when physicians have a financial incentive to self-refer, that they do this, even at the expense of optimal patient care. Self-referral abuses must be stopped. I would reccommend PAMED embrace working with the State House to craft a fair bill.

Dr. KB at 6/4/2010 10:41:10 AM


I support any such bill that prevents my work as a pathologist from being outsourced. I currently cannot find a full-time position because the market has been ruined by greedy physician groups that want to take away our bread and butter business and then offer it back at 50% of our professional fee. This practice is demeaning and abusive and must stop. I imagine that radiologists probably feel the same way.

KB at 6/3/2010 11:08:39 PM


Physician self-referral for MRI, CT, PET, and other nuclear medicine studies should without question be illegal. It is absolutely clear that this practice dramatically increase utilization rates while at the same time severely diminishing market forces resulting in marked degradation of quality. Come on guys, this is a no brainer. SELF-REFERRAL IS UNETHICAL!!

CJ Altermann at 4/1/2010 5:11:37 PM


I am a registered nurse who also attended law school. While taking a course in medical malpractice, I was told by my professor that he could not believe how physicians had permitted their profession to be regulated and dictated to by the HMO's and the government. He assured the class that the legal profession would NEVER permit that to happen to them. I realize that a high percentage of both federal and state law makers are attorneys, but when are the doctors going to stand up for themselves, their profession and their patients? Perhaps that old adage should be changed to "those who can become lawyers; those who can't become physicians". Physician heal thy self!

Bernie, R.N., J.D. at 3/22/2010 9:59:02 AM


Here we go again! The 'sanctimonious group,' of a variety of backgrounds and categories, usually attorneys with elective responsibilities and/ or a 'mask' of self-importance, decides how society is harmed and utilizes the legislative process to further narrow 'everyone elses' privileges and set a 'moral tone.' Now one can understand the lack of 'tort reform.' Right? Some physicians need an 'orthopedic enema' (sic) amd invite these maneuvers. But,most trying to 'make a buck' legitimentely (??definition these days??) are stiffled by the 'neo-Marxist' -"only-we-can-make a-buck" croud. Who's defining 'self-referral and legitimate?'

REINA, M.D. at 3/19/2010 7:05:49 AM


My reading of the act as written is a blanket prohibition on referrals to physician-owned entities. Although it appears that physicians could continue to own existing covered entities, such as ASC's, they could no longer perform procedures in them on their own patients. Does anyone else read this differently? This would force either the closure or sale of nearly every free-standing ASC in PA. It does not appear to address cross-state ownership ownership: could a PA physician own and utilize a New Jersey ASC? This legislation obviously hits physicians harder than hospitals and was likely instigated at their request. While "fairness" is debatable, the loose ends in this act are not.

DoctorG at 3/18/2010 5:38:21 PM

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