Anti-Kickback and Stark rules also apply to the analysis of whether payments made to you as a medical director are proper. These direct compensation arrangements are looked at in light of the fair market value of the services provided and whether the arrangement is an overt way of directing additional revenue to a physician for referring patients. The term remuneration is viewed in its broadest terms and looks at anything of value. Additionally, unlike Stark, the Anti-Kickback rule does not have a de minimis amount, and remuneration means anything of value.
It is my understanding that you serve as the medical director for the cardiology unit at the hospital and are not paid. I am not completely familiar with your arrangement, but one of the reasons the hospital does not compensate you for this service is to ensure that you are not given a reward for referring patients and are only paid for exactly what you do.
However, paying a medical director is not prohibited as long as the compensation is within the fair market value of the service provided, and there are sufficient safeguards to ensure that you are not being paid as an inducement for referring patients. To ensure against this you, should be keeping track of your time spent performing administrative duties, the types of duties performed, etc. This will give the hospital a better opportunity to ensure that the remuneration, if any, is reasonable and at fair market value.
Unfortunately, your suggestion of being paid as the medical director of the proposed center, in light of the fact that one of the radiologists will in fact be the medical director, is clearly a prohibited transaction both under Stark and Anti-Kickback statutes.
The additional compensation for not doing anything is a violation because the remuneration paid is not a one-for-one exchange at fair market value for services provided. Engaging in such a transaction would be a violation of Stark and, more importantly, would violate the Anti-Kickback rules and subject you and the hospital to civil and criminal penalties.
The Anti-Kickback statutes do provide for safe harbors for specific transactions. One of those safe harbors relates to “bona fide employment relationships,” and an element of such a relationship is that it is an arm’s length transaction wherein the hospital receives fair value in the form of actual services performed by the employee.
Your proposed relationship is a one-way transaction and the hospital is receiving no value from the relationship. Therefore, a fair look at the proposed transaction would conclude that the money is being paid to entice referrals from you and/or your cardiology group. This would be an illegal transaction.