Lexology August 28, 2019
Hospitals may wish to enter into joint ventures with physicians for a variety of reasons.
Commonly, the motivation is a mutual desire to bring about a new service line to benefit the communities served by both parties. In addition, hospitals often wish to harness and promote the physicians’ expertise associated with the subject matter of the particular service line.
However, if the service in question is a “designated health service” under the physician self-referral law, often referred to as the “Stark” law,[1] additional concerns come into play. If the service is not in a rural location,[2]Stark may preclude the physicians from having a traditional ownership interest in the service. For example, proton therapy facilities are strongly gaining traction in the...
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