QUESTION:        We have a group of surgeons on our staff who are interested in employing a physician assistant.  Wasn’t there a new Stark regulation that will allow our hospital to provide recruitment assistance to the group to assist it with the costs of employing this PA?

ANSWER:           The good news is that, as of January 1, 2016, there is a new Stark exception that will permit a hospital to provide recruitment assistance to a physician group to recruit a nonphysician practitioner.  The bad news is that the exception is limited to groups who provide primary care services or mental health services.  So a surgical group would not qualify for this exception.

Even if the exception did apply, an income guaranty is not permitted.  Rather, the recruitment subsidy cannot exceed 50% of the actual compensation paid to the nonphysician practitioner (including signing bonus and benefits) during the first two years the nonphysician practitioner is employed by the group.

Since the Stark Law only applies to compensation arrangements involving a physician or a physician group, the Stark Law would not apply if the hospital decided to provide assistance, such as educational loan assistance, directly to the nonphysician practitioner.  However, remember the Anti-kickback Statute still applies even if the Stark Law does not.  So, you cannot provide that recruitment assistance if it is intended to induce the nonphysician practitioner (or his/her employer) to refer or otherwise generate business for the hospital.

So while the new Stark nonphysician practitioner recruitment assistance exception is helpful, it is limited both in the types of medical specialists who may receive this recruitment assistance and the type of the recruitment assistance that may be provided.