What is the lease arrangements (rental of office space) Stark exception?
Stark may be implicated if a physician (or his immediate family) enters a lease arrangements with entities to which he refers for designated health services (DHS). This is a common problem when physicians lease equipment to a hospital or when a hospital leases space (or equipment) to physicians. Leases for rental of office space or equipment are exempted if the arrangement meets the following requirements: • Parties sign a written lease, specifying premises covered by the lease. • The rented or leased space is reasonable and necessary for the legitimate purposes of the lease, and it must be used exclusively by the lessee when the lease is in effect. • The rent calculation for common areas, such as a waiting room or parking lot, must be based on a pro rata share of expenses. • The rental charges are set in advance and consistent with fair market value and are not determined in a manner that takes into account the volume or value of referrals between the parties. • The four above mention
