Physicians Renting from Physicians

How do you structure a physician’s lease when the physician is leasing
from a medical provider? Why does it matter?

Leases between medical providers often involve state and
federal rules and regulations relating to referrals.  As a general rule, if the lease is being
provided for anything other than fair market value, there may be an issue.  For example, an owner of a building that runs
a specialty such as urology may rent to a general practitioner at below market
rate
with the expectation that the general practitioner will provide
referrals.  In order to avoid the
Anti-kickback statutes or Stark rules, most leases should have rent set in
advance, at market rate, and without change dependent on volume of business or
referrals back and forth.

There are other rules for diagnostic facilities.  Federal laws may provide exceptions, but
state law may not.  The only solution is
to be proactive.  Make sure your lease is
reviewed by a lawyer who understands this area of the law.  The last thing a physician wants is to be
visited by Medicare with accusations about kick-back schemes.

Post by Matthew L. Kinley, Esq.