Physician liaison programs: kickback and Stark rules

Hospitals, imaging centers, labs, physical therapy clinics, surgery centers, home health agencies, hospices and specialist groups often hire a physician liaison: a person whose job is to visit referring offices, explain the services, smooth the referral process and bring feedback back. It is one of the oldest forms of healthcare marketing, and the one that sits closest to the federal laws on paying for referrals.

This guide reads those laws for the people who build and run liaison programs: how the liaison is paid, what the liaison may give a referring physician or office, and what records to keep. It does not repeat our guides to gifts and meals for referring physicians and patient and physician referrals, which go deeper on gift limits and on referral programs in general. Liaisons who staff conference booths should also see healthcare trade show marketing. Labs that pay home draw services should also see mobile phlebotomy marketing. When a hospital offers to pay for a practice’s ads, see hospital and practice co-branded marketing.

This is general information, not legal advice. Sources cited were checked on November 1, 2026: 42 USC 1320a-7b, 42 USC 1320a-7a, 42 USC 1395nn and 18 USC 220 in the Cornell LII text of the U.S. Code; 42 CFR 1001.952, 42 CFR 411.357 and 45 CFR 102.3 in the eCFR version up to date as of October 29, 2026. We did not read OIG advisory opinions, case law or state laws for this guide. Compensation design for a liaison program is a question for a health care attorney and, where fair market value matters, a valuation professional.

The short version

Three federal laws can apply. The Anti-Kickback Statute reaches anyone paying to induce referrals of federal health care program business (42 USC 1320a-7b(b)). The Stark law reaches financial relationships between a physician and an entity furnishing designated health services (42 USC 1395nn(a)). EKRA reaches referrals to laboratories, clinical treatment facilities and recovery homes paid by any health care benefit program, private insurance included (18 USC 220(a)).
How you pay the liaison matters. Pay to a bona fide employee falls under a statutory exception and a safe harbor (1320a-7b(b)(3)(B); 42 CFR 1001.952(i)). A contractor fits the personal services safe harbor only if the pay methodology is set in advance, at fair market value and not tied to the volume or value of referrals (1001.952(d)(1)(iv)).
Labs: commissions are a problem even for employees. EKRA’s employee and contractor exception applies only if pay is not determined by and does not vary by referrals, tests or the amount billed (18 USC 220(b)(2)).
What the liaison gives physicians counts. The anti-kickback statute covers remuneration “in cash or in kind” (1320a-7b(b)(2)). For entities under Stark, gifts and meals to a referring physician must fit an exception such as the nonmonetary compensation limit (42 CFR 411.357(k)).
Penalties are large. Up to $100,000 and 10 years for an anti-kickback felony (1320a-7b(b)(2)); civil penalties per act, adjusted for inflation (42 USC 1320a-7a(a); 45 CFR 102.3); up to $200,000 and 10 years per occurrence under EKRA (18 USC 220(a)).

Which laws reach your liaison program

The Anti-Kickback Statute. 42 USC 1320a-7b(b)(2) makes it a felony to knowingly and willfully offer or pay any remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce a person to refer an individual for an item or service paid in whole or in part by a federal health care program, or to arrange for or recommend ordering one. Paragraph (b)(1) covers the other side: soliciting or receiving it. The statute applies to any provider or supplier that bills Medicare, Medicaid or another federal program, and it applies to the liaison as well as to the employer.

The Stark law. 42 USC 1395nn(a)(1) says that if a physician, or an immediate family member, has a financial relationship with an entity, the physician may not refer Medicare patients to that entity for designated health services, and the entity may not bill for them, unless an exception applies. A financial relationship includes a compensation arrangement (1395nn(a)(2)(B)). A hospital, a lab or an imaging center that furnishes designated health services and gives a referring physician something of value has a compensation arrangement to fit into an exception. The referral and billing prohibition in 1395nn(a)(1) contains no intent requirement; intent comes in only for the civil penalties in 1395nn(g).

EKRA. 18 USC 220(a) makes it a crime to knowingly and willfully pay or offer remuneration to induce a referral to a recovery home, clinical treatment facility or laboratory, or in exchange for an individual using its services, for services covered by a health care benefit program. That term comes from 18 USC 24(b), which defines it as any public or private plan or contract under which a medical benefit, item or service is provided, so it is not limited to federal programs (18 USC 220(e)(3)). “Laboratory” has the CLIA meaning in 42 USC 263a (220(e)(4)), and “clinical treatment facility” means a non-hospital setting licensed or certified for substance use treatment (220(e)(2)). For a lab or a substance use treatment program, EKRA is the law that most directly governs liaison pay.

Paying a liaison who is an employee

The Anti-Kickback Statute does not apply to “any amount paid by an employer to an employee (who has a bona fide employment relationship with such employer) for employment in the provision of covered items or services” (42 USC 1320a-7b(b)(3)(B)). The safe harbor at 42 CFR 1001.952(i) repeats that rule and says “employee” has the meaning used for federal employment taxes in 26 USC 3121(d)(2), which covers an individual who has the status of an employee under the usual common law rules.

Two points follow. First, the employee route depends on a bona fide employment relationship under those common law rules, not a contractor relabeled as an employee. Second, the text speaks of employment “in the provision of covered items or services”. Whether a sales-only role fits that wording, and whether a bonus tied to referral volume stays inside it, are questions to put to counsel before the compensation plan is written. Do not assume that being on payroll settles the question.

For labs, clinical treatment facilities and recovery homes, EKRA adds a clearer limit. Its exception for payments to employees and independent contractors applies only if the payment “is not determined by or does not vary by” the number of individuals referred, the number of tests or procedures performed, or the amount billed to or received from the health care benefit program for the individuals referred (18 USC 220(b)(2)). A lab liaison paid a commission per specimen, or a percentage of collections from the accounts they bring in, does not fit that exception, whether the liaison is an employee or a contractor.

Paying a liaison who is a contractor

Some organizations use independent marketing firms or 1099 liaisons. For them, the relevant anti-kickback safe harbor is the personal services and management contracts safe harbor at 42 CFR 1001.952(d)(1). Payments from a principal to an agent are protected only if all of these standards are met:

Written and signed. The agency agreement is in writing and signed by the parties (1001.952(d)(1)(i)).
Covers all services. It covers and specifies all of the services the agent provides for the term (1001.952(d)(1)(ii)).
At least one year. The term is not less than 1 year (1001.952(d)(1)(iii)).
Pay set in advance, at fair market value, not tied to referrals. The compensation methodology is set in advance, consistent with fair market value in arm’s-length transactions, and not determined in a manner that takes into account the volume or value of referrals or business generated between the parties for federal program business (1001.952(d)(1)(iv)).
Lawful services. The services do not involve counseling or promoting a business arrangement or activity that violates state or federal law (1001.952(d)(1)(v)).
Reasonably necessary. The aggregate services do not exceed what is reasonably necessary for the commercially reasonable business purpose (1001.952(d)(1)(vi)).

A per-referral fee, a percentage of revenue from referred patients, or a bonus for each new referring office does not meet standard (iv). Falling outside a safe harbor does not by itself make an arrangement illegal; it means the arrangement is judged on the facts, including intent, under the statute’s knowing and willful standard. But a contractor paid by the referral, whose job is to generate referrals of federal program patients, is the arrangement the statute describes. For labs and the other EKRA facilities, EKRA’s own exception for personal services contracts points to 1001.952(d) “as in effect on the date of enactment” of EKRA, October 24, 2018 (18 USC 220(b)(4)); that version may differ from the current text, so counsel should compare both.

What a liaison may give referring offices

Liaisons visit offices, and visits come with coffee, lunches, branded items and invitations. Each of these is remuneration “in kind” under the anti-kickback statute. For entities that furnish designated health services, each is also compensation to a referring physician that needs a Stark exception. The exceptions used most for liaison activity are:

Nonmonetary compensation. Items or services, not cash or cash equivalents, up to an annual aggregate of $300 per physician, adjusted for inflation each calendar year, if the compensation is not determined in any manner that takes into account referrals and is not solicited by the physician or the practice, including its staff (42 CFR 411.357(k)(1), (2)). CMS posts the adjusted figure each year; our gifts and meals guide gives the current figure and a tracking log.
Inadvertent overage. An excess of no more than 50 percent of the limit is treated as within it if the physician repays it by the earlier of the end of the calendar year or 180 days, and this may be used once every 3 years per physician (411.357(k)(3)).
Medical staff appreciation event. An entity with a formal medical staff may hold one local appreciation event a year for the entire medical staff; gifts at the event count toward the limit (411.357(k)(4)).
Hospital medical staff incidental benefits. Items or services from a hospital to its medical staff used on the hospital’s campus, offered to all staff in the same specialty, not tied to referrals, and provided while they are making rounds or doing other work that benefits the hospital or its patients (411.357(m)).

Gift cards and cash are excluded from the nonmonetary compensation exception by its own terms (411.357(k)(1)). The Stark exceptions do not answer the anti-kickback question; an item that fits 411.357(k) can still be offered with the intent to induce referrals. A liaison program needs a written gift and meal policy that covers both laws, and a log that the liaison fills in after every visit.

What a liaison should talk about

The statutes regulate what is paid and given, not what is said. A liaison who explains services, scheduling, report turnaround, insurance accepted, how to send a referral and how results come back is giving referring offices information they can use. The risk starts when the conversation moves to what the referring office will get. Points to build into training:

Do not offer or hint at anything of value in exchange for referrals: free staff, covering an office’s costs, paid speaking or advisory roles that require little work, or extra perks for high-volume referrers. The anti-kickback statute covers remuneration paid “directly or indirectly, overtly or covertly” (1320a-7b(b)(2)).
Do not accept requests from offices for gifts, tickets or donations; the nonmonetary compensation exception requires that the compensation not be solicited by the physician or practice staff (411.357(k)(1)(ii)).
Report back any request that sounds like a quid pro quo, in writing, to the compliance contact.
Keep claims about outcomes, wait times and quality accurate and supportable; those claims are advertising and fall under the FTC Act’s ban on deceptive acts and practices (15 USC 45(a)) and state rules.

Records a liaison program should keep

The liaison’s job description, offer letter or contract, and the compensation plan, with the date it was set and, for contractors, the fair market value support (1001.952(d)(1)(iv)).
A visit log: date, office, physicians present, topics, and anything given.
A gift and meal log per physician per calendar year, with retail values, to track the nonmonetary compensation limit (411.357(k)).
Training records showing the liaison received the gift, meal and conversation policy.
Any requests from offices for things of value and how they were handled.

Penalties

Under the Anti-Kickback Statute, a conviction carries a fine of not more than $100,000, imprisonment of not more than 10 years, or both (42 USC 1320a-7b(b)(1), (2)). Separately, the civil monetary penalties law sets a penalty of not more than $100,000 for each act described in 1320a-7b(b), plus damages of not more than 3 times the total remuneration offered, paid, solicited or received (42 USC 1320a-7a(a)). That amount is adjusted for inflation, and 45 CFR 102.3 lists the 2025 adjusted maximum as $127,973.

Under the Stark law, no Medicare payment may be made for a service provided in violation of the referral prohibition, and amounts collected must be refunded (42 USC 1395nn(g)(1), (2)). Presenting a claim the person knows or should know is prohibited carries a civil penalty of not more than $15,000 per service (1395nn(g)(3)), listed as $31,670 for 2025 in 45 CFR 102.3. A circumvention scheme, such as a cross-referral arrangement, carries not more than $100,000 per arrangement (1395nn(g)(4)), listed as $211,146 for 2025. Under EKRA, a violation carries a fine of not more than $200,000, imprisonment of not more than 10 years, or both, for each occurrence (18 USC 220(a)).

An illustration

This is a made-up example, not a client. An independent imaging center and lab hires a contract liaison through a marketing firm. The contract pays a fee for each new referring practice and a percentage of collections from scans and lab tests those practices order. The liaison brings lunch to the same three offices every week and hands out coffee shop gift cards at holiday time.

The fix: the center ends the per-practice and percentage terms. On counsel’s advice it hires the liaison as a W-2 employee at a salary set in advance, with no part of pay determined by or varying with referrals, tests or collections, so that the lab side fits the EKRA exception in 18 USC 220(b)(2). Gift cards stop, because cash equivalents fall outside 42 CFR 411.357(k). Lunches go into a per-physician log against the annual nonmonetary compensation limit, and the visit rotation is set by service area, not by who refers the most. The liaison is trained on the written policy, and requests from offices go to the compliance lead.

Checklist

Laws mapped: anti-kickback for federal program business, Stark if you furnish designated health services, EKRA if you are a lab, clinical treatment facility or recovery home.
Liaison classified correctly as employee or contractor (26 USC 3121(d)(2) via 42 CFR 1001.952(i)).
Contractor agreements meet every standard in 1001.952(d)(1), with pay set in advance at fair market value.
No pay that varies with referrals, tests or amounts billed for EKRA facilities (18 USC 220(b)(2)).
Gift and meal policy covering both the anti-kickback statute and 411.357(k), with no cash or cash equivalents.
Visit and gift logs kept per physician per calendar year.
Training records and a route for reporting requests from offices.
Compensation plan reviewed by a health care attorney before launch and when it changes.

How we help

We build the materials liaisons carry and the referral pages they point to: website design, referral forms and service pages, and lead generation and search work for practices and health companies. We do not design liaison compensation plans or give legal opinions on them, and we are not a law firm. Related guides: branded promotional items and our guide to healthcare marketing rules.

Can a physician liaison be paid a commission on referrals?

For a contractor, a commission tied to referrals falls outside the personal services safe harbor, which requires pay not determined by the volume or value of referrals (42 CFR 1001.952(d)(1)(iv)). For labs, clinical treatment facilities and recovery homes, EKRA’s exception applies to employees and contractors only if pay does not vary by referrals, tests or amounts billed (18 USC 220(b)(2)). Ask counsel before any variable pay.

Does the employee exception protect any salary and bonus?

It covers amounts paid to a bona fide employee for employment in the provision of covered items or services (42 USC 1320a-7b(b)(3)(B); 42 CFR 1001.952(i)). Whether a sales-only role and a referral-based bonus fit that wording is a question for a health care attorney.

Can a liaison bring lunch to a referring office?

For an entity under the Stark law, meals count toward the annual nonmonetary compensation limit per physician in 42 CFR 411.357(k), must not be tied to referrals and must not be solicited. The anti-kickback statute applies separately, so the intent behind the lunch matters too.

Can a liaison give gift cards?

Not under the Stark nonmonetary compensation exception, which excludes cash and cash equivalents (42 CFR 411.357(k)(1)).

Does EKRA apply if we take no Medicare patients?

EKRA covers services paid by any health care benefit program, as defined in 18 USC 24(b), so it is not limited to federal programs. It applies to referrals to laboratories, clinical treatment facilities and recovery homes (18 USC 220(a)).

What are the penalties?

Up to $100,000 and 10 years for an anti-kickback felony (42 USC 1320a-7b(b)); a civil penalty of up to $100,000 per act, adjusted to $127,973 for 2025, plus up to 3 times the remuneration (42 USC 1320a-7a(a); 45 CFR 102.3); and up to $200,000 and 10 years per occurrence under EKRA (18 USC 220(a)).

Physician liaison programs: marketing to referring doctors under the kickback, Stark and EKRA rules