Law orders self-referral disclosure

May 22, 1991

Licensed health-care providers in Maryland will soon be requiredto reveal ownership interests in medical services to which theyrefer patients. These are the terms of a new law that takes effectin that state on July 1. "This is one of the strongest

Licensed health-care providers in Maryland will soon be requiredto reveal ownership interests in medical services to which theyrefer patients. These are the terms of a new law that takes effectin that state on July 1.

"This is one of the strongest disclosure laws in the nation,"said Sen. Paula Hollinger (D-Baltimore County), the bill's sponsor.

The law is more lenient than anti-kickback reforms backed bythe Maryland Business-Labor Coalition. That group had advocatedan outright ban against self-referral, but its proposal died incommittee last year, according to MBLC co-chair Ernest Crofoot.

MBLC led a drive in 1990 for legislation that would have givenrate-setting authority for hospital-based physicians, such asradiologists and pathologists, to the Health Services Cost ReviewCommission. The government agency sets hospital rates for Marylandhospitals. That proposal also died in committee, Crofoot said.

Under the new law, providers must post a notice in their officeswithin patients' view to alert them to all medical services inwhich the practitioners own more than 2% of the whole entity,or a $5000 or greater share in health-care related business.

Written notification must be issued to all patients when theyare seen by their physician. Patients who are prescribed to aservice their physician owns must sign an additional notification,which becomes part of their medical records.

The rule applies to investments held by the practitioner andthe practitioner's immediate family, including brothers and sisters.It encompasses diagnostic imaging, medical laboratories, pharmacies,home health, rehabilitation, nursing homes, physical therapy andsurgery centers.