Paying direct compensation to physicians has become complicated due to regulations such as Stark I, Stark II and the Federal Anti-Kickback Statute. Compliance with these regulations, however, is critical to the success of the organization.

This sample audit report can be used to measure the effectiveness of a company's physician contracting and payment processes, to analyze a physician's written and managed contracts in relation to company policy regulations, to identify control and/or compliance weaknesses, and to recommend improvements.

The following key observations were noted during the review:

• Contracts may not contain a stipulation restricting the execution of similar arrangements within the first year of the contract term.
• Contracts terms may not contain a termination date and/or may contain an indefinite contract term.
• Contracts may be incomplete and/or missing exhibits.
• Contract terms may commence prior to the full execution of the contract.
• Contracts may not contain a requirement to submit time logs and/or other support documentation.