To Per-Click or Not to Per-Click, That Is the Question

Episode Date: May 22, 2024

In this episode of Stark Integrity, Bob Wade (Captain Integrity) tackles a classic—and often misunderstood—compensation structure under the Stark Law:

Per-click (or per-use) arrangements.

While these arrangements can be permissible in certain circumstances, they also present significant compliance risk if not structured carefully. This discussion breaks down when per-click works—and when it does not.

What Is a Per-Click Arrangement?

A per-click arrangement is a compensation model where:

Payment is made each time a service, piece of equipment, or space is used.

Instead of a fixed fee, compensation:

• Fluctuates based on usage
• Is tied to each “click” or instance of service

These structures are commonly seen in:

• Equipment leases
• Space arrangements
• Certain service models

At first glance, they appear straightforward—but under Stark:

The details matter.

Why Per-Click Raises Concerns

The primary concern with per-click arrangements is that they can:

Incentivize increased utilization.

When compensation increases with each use:

• There may be a financial incentive to generate more services
• Referral patterns may influence utilization
• The arrangement may indirectly reward volume

This directly implicates Stark’s prohibition on compensation that:

Takes into account the volume or value of referrals.

When Per-Click May Be Permissible

As discussed in the episode, per-click arrangements are not prohibited outright.

They may be permissible when:

• Payments are consistent with fair market value
• The arrangement is commercially reasonable
• Compensation is set in advance
• The structure does not reflect referrals or referred services

This is the key distinction:

Per-click is about structure—but compliance is about what drives the structure.

Where Per-Click Breaks Down

Per-click arrangements create risk when:

• Payments increase based on services provided to referred patients
• The model reflects downstream revenue or utilization tied to referrals
• Physicians are in a position to influence usage volume

Regulatory guidance has specifically targeted these scenarios, particularly in:

• Equipment leases
• Space rentals
• Other arrangements involving referring physicians

The concern is clear:

Per-click can become a proxy for referral-based compensation.

The “Determined In Any Manner” Standard

As with other Stark analyses, the critical question is not just how compensation behaves—but:

How it was determined.

Under the Stark exceptions, compensation cannot be:

“Determined in any manner” that takes into account referrals.

This is a broad and strict standard.

It means that even if:

• Payments are per-click
• The rate appears reasonable
• The structure seems neutral

The arrangement may still fail if:

Referral volume influenced the design of the per-click rate or model.

Misconceptions About Per-Click

The episode dispels several common misconceptions:

• Myth: Per-click is always prohibited
  • Reality: It can be permissible in limited circumstances
• Myth: If the rate is FMV, the structure is compliant
  • Reality: FMV alone does not address volume/value concerns
• Myth: Per-click is just a billing mechanism
  • Reality: It is a compensation methodology subject to Stark scrutiny

The key takeaway:

Structure alone does not determine compliance—context does.

Practical Compliance Considerations

From an operational standpoint, organizations should:

• Evaluate whether per-click creates incentives tied to referrals
• Ensure payments are based on non-referred services where applicable
• Carefully document how rates were determined
• Confirm alignment with FMV and commercial reasonableness
• Avoid using per-click models where referral influence is likely

Because in practice:

Per-click arrangements require heightened scrutiny—not assumptions of safety.

Key Takeaways

• Per-click arrangements are not inherently prohibited — but they are high risk
• The concern is incentive — increased utilization tied to compensation
• Compliance depends on structure and intent — not just the payment method
• The “determined in any manner” standard applies — broad and strict
• FMV alone is not sufficient — volume/value analysis is required
• Per-click often breaks down in referral-driven contexts — especially leases
• Documentation and design are critical — regulators will examine both

Final Thoughts

This episode reinforces an important principle in Stark Law:

How compensation is structured can shape behavior—and regulators will examine that closely.

Per-click arrangements sit at the intersection of:

• Operational flexibility
• Financial incentives
• Compliance risk

They are not inherently problematic—but they require careful thought, disciplined structuring, and clear documentation.

Ultimately, organizations must ask:

• What is driving this model?
• Does it incentivize utilization tied to referrals?
• Can we clearly defend how it was determined?

Because in today’s environment:

The difference between a permissible per-click arrangement and a prohibited one often comes down to the underlying intent and design—not the label.

Click here to listen to this Stark Integrity Podcast Episode:
https://podcasts.apple.com/us/podcast/to-per-click-or-not-to-per-click-that-is-the-question/id1588939373?i=1000656349207&l=fr-FR