S.B. 437                                                  VETOES

Section 1-302

Annotated Code of Maryland

(1994 Replacement Volume and 1996 Supplement)

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That the Laws of Maryland read as follows:

Article - Health Occupations

1-302.

(a)     Except as provided in subsection (d) of this section, a health care practitioner
may not refer a patient, or direct an employee of or person under contract with the health
care practitioner to refer a patient to a health care entity:

(1)     In which the health care practitioner [, the practitioner's immediate
family,] or the practitioner in combination with the practitioner's immediate family owns
a beneficial interest;

(2)     IN WHICH THE PRACTITIONER'S IMMEDIATE FAMILY OWNS A
BENEFICIAL INTEREST OF 3 PERCENT OR GREATER; or

[(2)](3) With which the health care practitioner, the practitioner's
immediate family, or the practitioner in combination with the practitioner's immediate
family has a compensation arrangement.

(b)     A health care entity or a referring health care practitioner may not present or
cause to be presented to any individual, third party payor, or other person a claim, bill, or
other demand for payment for health care services provided as a result of a referral
prohibited by this subtitle.

(c)     Subsection (a) of this section applies to any arrangement or scheme, including
a cross-referral arrangement, which the health care practitioner knows or should know
has a principal purpose of assuring indirect referrals that would be in violation of
subsection (a) of this section if made directly.

(d)     The provisions of this section do not apply to:

(1)     A health care practitioner when treating a member of a health
maintenance organization as defined in § 19-701 of the Health - General Article if the
health care practitioner does not have a beneficial interest in the health care entity;

(2)     A health care practitioner who refers a patient to another health care
practitioner in the same group practice as the referring health care practitioner;

(3)     A health care practitioner with a beneficial interest in a health care
entity who refers a patient to that health care entity for health care services or tests, if the
services or tests are personally performed by or under the direct supervision of the
referring health care practitioner;

(4)     A health care practitioner who refers in-office ancillary services or tests
that are:

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