QUESTION:    We can find an e-mail exchange between our hospital and a referring physician that discussed a personal services agreement that satisfies all of the requirements of the Stark Law except for the requirement that the agreement is to be signed by both parties. The e-mail exchange shows that the parties agreed on the terms of the Agreement. Can the e-mails be used to satisfy the Stark signature requirement?

ANSWER:    The personal services and fair market compensation exceptions to the Stark Law state that an agreement must be in writing and signed by both parties. That is usually accomplished by using a hard copy of a written agreement that is physically executed by both the hospital and the physician. However, while there is little precedent on the application of the federal Uniform Electronic Transaction Act (“UETA”) to the Stark Law, 73 PS §2260.303, the UETA appears to provide a solution to your dilemma.

Section 2260.303(a) of the UETA states that “a record or signature may not be denied legal effect or enforceability solely because of its electronic form.” Subsection (c) then states: “If a law requires a signature, an electronic signature satisfies the law.”

The “editor’s notes” attached to the UETA define a number of terms that are used in the UETA. The editor’s notes on the definition of an agreement state: “whether the parties have reached an agreement is determined by their express language and all surrounding circumstances.”

The editor’s notes that describe an electronic signature then state:

The idea of a signature is broad and not specifically defined. Whether any particular record is ‘signed’ is a question of fact. Proof of that fact must be made under other applicable law. This Act simply assures that the signature may be accomplished through electronic means. No specific technology need be used in order to create a valid signature. One’s voice on an answering machine may suffice if the requisite intention is present. Similarly, including one’s name as part of an electronic mail communication also may suffice, as may the firm name on a facsimile. (Emphasis added.)

When one also considers that the preamble to the Stark Phase 3 Regulations states: “Nothing in the regulations precludes execution of the agreement in counterparts” 72 FR 51051 (Sept. 5, 2007), then it is difficult to see any reason why, given the terms of the UETA, a hospital could not consider the e-mail exchange between the hospital and the physician to satisfy the Stark signature requirement.