Space and Equipment Leases & Health Care Contracts

Houston Health Care Attorneys Serving Texas

Health care providers are subject to intense scrutiny and a number of complex regulations. Among the many issues of ensuring compliance with various state and federal health care laws, physicians and practices of all types must also carefully structure their medical contracts and financial relationships to ensure they do not violate health care fraud and abuse laws. Failing to do so can subject a provider to time-consuming and costly audits, investigations, and serious penalties that can put their professional future at risk.

At Hendershot Cowart, P.C., we know health care providers are increasingly being asked to navigate a dense and confusing regulatory landscape while being threatened by increasingly severe repercussions and penalties if they aren’t able to address all issues of compliance. As such, our Houston health care lawyers know we play an important role in providing the counsel and representation providers need to ensure regulatory compliance, especially in relation to high stakes issues like health care fraud.

If you have questions about medical contracts, space and equipment leases, and how our award-winning legal team can put over 130 years of collective experience to work for you, call (713) 909-7323 or contact us online to request an initial consultation. We serve clients throughout Texas and nationwide.

Compliant Contracts & Financial Relationships

Health care regulators are keen on scrutinizing the contracts and financial relationships providers establish as part of their practice, from employment arrangements, personal services, and management services to the leasing of office space and equipment. That’s because they want to ensure those relationships do not violate health care fraud and abuse laws, such as the Stark Law and the Anti-Kickback Statute.

• Stark Law – The Stark Law, or self-referral law, is federal legislation that prohibits physician referrals for designated health services (DHS) paid for by Medicare and Medicaid to any entity with which physicians have a financial relationship. In terms of lease arrangements, the Stark Law prohibits arrangements involving tenant entities that pay or receive remuneration physicians or other potential referral sources with the intent to induce referrals or otherwise generate business.
• Anti-Kickback Statute – The Anti-Kickback Statute is a federal health care law that makes it illegal to knowingly and willfully exchange remuneration to influence referrals of federal health care program business. Unlike the Stark Law, the AKS is broad and can apply to any entity that engages in financial relationships with federally operated health care entities. It can also subject violators to serious civil and criminal penalties.

Anti-Kickback Statute is a safe harbor, Stark Law is an exception, that allow otherwise prohibited financial relationships, including those involving space and equipment leases, provided that all statutory requirements are satisfied. Our firm has extensive experience reviewing and drafting contractual relationships to ensure they fit within a Stark Law exception or safe harbor under the AKS, and meet all conditions, including:

• Lease agreements must be made in writing for a term of at least one year.
• Agreements must be signed by all parties and cover the specified space, equipment, and leasing services, including any arrangements that involve part-time or periodic schedules. Less than full time must specify interval and frequency.
• Rental rates are set in advance, based on fair market value, and does not take referral volume or value into account.
• Lease agreements must be commercially reasonable.

Speak with a Proven Texas Health Care Lawyer. Call (713) 909-7323

Health care providers face unique obstacles when leasing property and equipment, as well as numerous regulations and requirements that must be met in order to ensure compliance. At Hendershot Cowart, P.C., our attorneys have accumulated the necessary insight and experience to help health care providers address all facets of complying with health care regulations concerning space and equipment leases involving new practice set-ups, mergers, joint ventures, and responsive compliance plans when defending them against investigations or alleged violations.

To learn more about our services and discuss your particular needs, contact us to request an initial consultation.