CHC LATEST 2026 EVALUATION TEST QUESTIONS AND
SOLUTIONS RATED A+
✔✔Stark Law Exceptions - Bona Fide Employment Relationships - ✔✔1. must be for
identifiable services
2. remuneration must be consistent with fair market value and not take into account
volume
3. agreements must be commercially reasonable
4. protects physicians who are employees under usual common law and IRS definitions
5. productivity bonus not prohibited if based on services personally performed by
physician
6. may not receive payment for generating referrals of DHS performed by others
✔✔Stark Law Exceptions - Personal Service Arrangements - ✔✔1. must be in writing,
signed by parties, and specify services covered
2. must cover all services to be provided by physician to entity
3. aggregate services contracted for may not exceed those reasonable and necessary
for legitimate business purposes
4. term must be at least one year (if terminated earlier, must wait one year before
entering same arrangement)
5. compensation must be set in advance and not based on referrals or volume
6. service may not involve counseling of unlawful business arrangement
7. month-to-month holdovers allowed for up to 6 months
✔✔Stark Law - Medical Staff Incidental Benefits - ✔✔1. applies only to hospitals and
entities that have bona fide medical staffs
2. items/services less than $32/occurrence - no limit if reasonably related to provision of
medical services
3. may not be cash or cash equivalents
4. compensation must be offered to all medical staff - not necessary accepted
5. must be offered without regard to volume or referrals (*)
6. compensation must be provided only while physician is making rounds or engaged in
other services/activities that benefit the hospital or its patients
7. compensation is used by the physician only on hospital campus
8. may not violate anti-kickback statute or any law or regulation
✔✔Stark Law - Non-Monetary Compensation - ✔✔1. compensation from entity in the
form of items or services
2. no cash or cash equivalents
3. not determined based on volume or referrals
4. may not be solicited by physician
5. does not violate anti-kickback statute or any law or regulation
6. should be tracked
7. exceeding the limit and not meeting exception triggers disallowance period (*)
,✔✔Stark Law Violations - Sanctions - ✔✔1. denial - CMS will not pay claims for
improperly referred DHS
2. refund - entity has duty to refund
3. civil monetary penalties - $15,000/claim; $100,000 if scheme to circumvent
4. potential for exclusion
5. potential FCA liability
✔✔Increased Scrutiny Due To: - ✔✔1. rising cost of care
2. healthcare errors/poor quality and resultant publicity
3. questionable board oversight in high visibility corporate scandals
4. increase in amount and complexity of regulatory requirements
✔✔Addressing Concerns - ✔✔1. more regulations/oversight
2. additional enforcement
3. increased fines and penalties
4. criminal prosecutions
5. holding boards and leadership personally accountable
✔✔General Expectations of Boards - ✔✔1. understand member role and responsibilities
2. awareness of complexity of health care laws and regulations
3. provide advisory oversight and direction (*)
✔✔What is the Basis for Board's Need to Know? - ✔✔1. why does the government
focus on board involvement?
2. what federal written agreement specifically details board oversight? - Conditions of
Participation
3. How are boards educated about regulatory issues? - compliance
4. what specific regulations should the board be aware of? - services provided and
billed by entity
✔✔Obligations of the Board of Directors (*) - ✔✔1. decision-making function - applying
duty of care principles to a specific decision or board action
2. oversight function - applying duty of care principles with respect to the general activity
in overseeing the day-to-day business activities of the corporation
✔✔Duty of Care (*) - ✔✔1. fiduciary duty of care = determination of whether the board
has acted in good faith, with prudent level of care, in manner reasonably believe is the
best interest of organization
2. reasonable inquiry - asking questions
✔✔Board of Directors - Compliance Program Focus Areas - ✔✔1. Structural -
understanding scope of program
2. Operational - understanding operation of program
, ✔✔Board of Directors - Oversight Structure (*) - ✔✔determine if compliance oversight
will be full board or sub-committee
role of subcommittee
1. ensure appropriate policies and procedures in place
2. ensure proper ethical and legal standards are present
3. monitor compliance with applicable laws/rules/regulations
✔✔Board of Directors - Compliance Program Oversight - ✔✔1. understand
organization's internal reporting system
2. determine if the structure of the organization's compliance program is appropriate to
size/complexity of operations
3. determine if resources available to compliance function are adequate to address risk
4. does compliance officer have authority to act?
5. how often does board receive reports from compliance officer? - at least once/year
6. are there periodic risk assessments?
7. is there compliance audit and monitoring plan?
8. are there appropriate policies, procedures, or other internal controls?
9. is there open communication (no fear of retaliation)?
✔✔Board Agenda - Compliance Program Reports - ✔✔1. education (current events,
regulatory changes)
2. compliance program reports (special project report, active compliance projects, newly
identified risk areas)
3. action items (policies and procedures, resource allocation
✔✔How Investigations are Initiated - ✔✔1. competitor complaints
2. consumer complaints
3. current or former employee (whistleblower) complaints
4. insurance company complaints
✔✔Investigative Techniques - ✔✔1. informal interviews and requests for documents
2. insider informants and whistleblowers
3. search warrants
4. subpoenas
5. electronic surveillance
✔✔When the Government Knocks to Obtain Documents...(*) - ✔✔1. subpoena or
search warrant or request by government agent
2. employees notify executives immediately
3. executives refer agent to company's counsel
✔✔Search Warrants (*) - ✔✔1. only time the government can take something and
immediate response required
2. agents can seize original documents
SOLUTIONS RATED A+
✔✔Stark Law Exceptions - Bona Fide Employment Relationships - ✔✔1. must be for
identifiable services
2. remuneration must be consistent with fair market value and not take into account
volume
3. agreements must be commercially reasonable
4. protects physicians who are employees under usual common law and IRS definitions
5. productivity bonus not prohibited if based on services personally performed by
physician
6. may not receive payment for generating referrals of DHS performed by others
✔✔Stark Law Exceptions - Personal Service Arrangements - ✔✔1. must be in writing,
signed by parties, and specify services covered
2. must cover all services to be provided by physician to entity
3. aggregate services contracted for may not exceed those reasonable and necessary
for legitimate business purposes
4. term must be at least one year (if terminated earlier, must wait one year before
entering same arrangement)
5. compensation must be set in advance and not based on referrals or volume
6. service may not involve counseling of unlawful business arrangement
7. month-to-month holdovers allowed for up to 6 months
✔✔Stark Law - Medical Staff Incidental Benefits - ✔✔1. applies only to hospitals and
entities that have bona fide medical staffs
2. items/services less than $32/occurrence - no limit if reasonably related to provision of
medical services
3. may not be cash or cash equivalents
4. compensation must be offered to all medical staff - not necessary accepted
5. must be offered without regard to volume or referrals (*)
6. compensation must be provided only while physician is making rounds or engaged in
other services/activities that benefit the hospital or its patients
7. compensation is used by the physician only on hospital campus
8. may not violate anti-kickback statute or any law or regulation
✔✔Stark Law - Non-Monetary Compensation - ✔✔1. compensation from entity in the
form of items or services
2. no cash or cash equivalents
3. not determined based on volume or referrals
4. may not be solicited by physician
5. does not violate anti-kickback statute or any law or regulation
6. should be tracked
7. exceeding the limit and not meeting exception triggers disallowance period (*)
,✔✔Stark Law Violations - Sanctions - ✔✔1. denial - CMS will not pay claims for
improperly referred DHS
2. refund - entity has duty to refund
3. civil monetary penalties - $15,000/claim; $100,000 if scheme to circumvent
4. potential for exclusion
5. potential FCA liability
✔✔Increased Scrutiny Due To: - ✔✔1. rising cost of care
2. healthcare errors/poor quality and resultant publicity
3. questionable board oversight in high visibility corporate scandals
4. increase in amount and complexity of regulatory requirements
✔✔Addressing Concerns - ✔✔1. more regulations/oversight
2. additional enforcement
3. increased fines and penalties
4. criminal prosecutions
5. holding boards and leadership personally accountable
✔✔General Expectations of Boards - ✔✔1. understand member role and responsibilities
2. awareness of complexity of health care laws and regulations
3. provide advisory oversight and direction (*)
✔✔What is the Basis for Board's Need to Know? - ✔✔1. why does the government
focus on board involvement?
2. what federal written agreement specifically details board oversight? - Conditions of
Participation
3. How are boards educated about regulatory issues? - compliance
4. what specific regulations should the board be aware of? - services provided and
billed by entity
✔✔Obligations of the Board of Directors (*) - ✔✔1. decision-making function - applying
duty of care principles to a specific decision or board action
2. oversight function - applying duty of care principles with respect to the general activity
in overseeing the day-to-day business activities of the corporation
✔✔Duty of Care (*) - ✔✔1. fiduciary duty of care = determination of whether the board
has acted in good faith, with prudent level of care, in manner reasonably believe is the
best interest of organization
2. reasonable inquiry - asking questions
✔✔Board of Directors - Compliance Program Focus Areas - ✔✔1. Structural -
understanding scope of program
2. Operational - understanding operation of program
, ✔✔Board of Directors - Oversight Structure (*) - ✔✔determine if compliance oversight
will be full board or sub-committee
role of subcommittee
1. ensure appropriate policies and procedures in place
2. ensure proper ethical and legal standards are present
3. monitor compliance with applicable laws/rules/regulations
✔✔Board of Directors - Compliance Program Oversight - ✔✔1. understand
organization's internal reporting system
2. determine if the structure of the organization's compliance program is appropriate to
size/complexity of operations
3. determine if resources available to compliance function are adequate to address risk
4. does compliance officer have authority to act?
5. how often does board receive reports from compliance officer? - at least once/year
6. are there periodic risk assessments?
7. is there compliance audit and monitoring plan?
8. are there appropriate policies, procedures, or other internal controls?
9. is there open communication (no fear of retaliation)?
✔✔Board Agenda - Compliance Program Reports - ✔✔1. education (current events,
regulatory changes)
2. compliance program reports (special project report, active compliance projects, newly
identified risk areas)
3. action items (policies and procedures, resource allocation
✔✔How Investigations are Initiated - ✔✔1. competitor complaints
2. consumer complaints
3. current or former employee (whistleblower) complaints
4. insurance company complaints
✔✔Investigative Techniques - ✔✔1. informal interviews and requests for documents
2. insider informants and whistleblowers
3. search warrants
4. subpoenas
5. electronic surveillance
✔✔When the Government Knocks to Obtain Documents...(*) - ✔✔1. subpoena or
search warrant or request by government agent
2. employees notify executives immediately
3. executives refer agent to company's counsel
✔✔Search Warrants (*) - ✔✔1. only time the government can take something and
immediate response required
2. agents can seize original documents
