{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/54.1-2411.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/54.1-2411.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/54.1-2411.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/54.1-2411.html"}],"law_id":82894,"edition_id":1,"section_id":82894,"structure_id":13237,"section_number":"54.1-2411","catch_line":"Prohibited referrals and payments; exceptions","history":"1993, c. 869; 2005, c. 402; 2025, c. 341.","full_text":"A\n\nUnless the practitioner directly provides health services within the entity and will be personally involved with the provision of care to the referred patient, or has been granted an exception by the Department or satisfies the provisions of subsections D or E of this section or of subsections D or E of § 54.1-2413, a practitioner shall not refer a patient for health services to an entity outside the practitioner’s office or group practice if the practitioner or any of the practitioner’s immediate family members is an investor in such entity.B\n\nThe Department may grant an exception to the prohibitions in this chapter, and may permit a practitioner to invest in and refer to an entity, regardless of whether the practitioner provides direct services within such entity, if there is a demonstrated need in the community for the entity and all of the following conditions are met:1\n\nIndividuals other than practitioners are afforded a bona fide opportunity to invest in the entity on the same and equal terms as those offered to any referring practitioner;2\n\nNo investor-practitioner is required or encouraged to refer patients to the entity or otherwise generate business as a condition of becoming or remaining an investor;3\n\nThe services of the entity are marketed and furnished to practitioner-investors and other investors on the same and equal terms;4\n\nThe entity does not issue loans or guarantee any loans for practitioners who are in a position to refer patients to such entity;5\n\nThe income on the practitioner’s investment is based on the practitioner’s equity interest in the entity and is not tied to referral volumes; and6\n\nThe investment contract between the entity and the practitioner does not include any covenant or clause limiting or preventing the practitioner’s investment in other entities.\n\t\t\t\tUnless the Department, the practitioner, or the entity requests a hearing, the Department shall determine whether to grant or deny an exception within 90 days of the receipt of a written request from the practitioner or entity, stating the facts of the particular circumstances and certifying compliance with the conditions required by this subsection. The Department’s decision shall be a final administrative decision and shall be subject to judicial review pursuant to the Administrative Process Act (§ 2.2-4000 et seq.).C\n\nWhen an exception is granted pursuant to subsection B:1\n\nThe practitioner shall disclose his investment interest in the entity to the patient at the time of referral. If alternative entities are reasonably available, the practitioner shall provide the patient with a list of such alternative entities and shall inform the patient of the option to use an alternative entity. The practitioner shall also inform the patient that choosing another entity will not affect his treatment or care;2\n\nInformation on the practitioner’s investment shall be provided if requested by any third party payor;3\n\nThe entity shall establish and utilize an internal utilization review program to ensure that practitioner-investors are engaging in appropriate and necessary utilization; and4\n\nIn the event of a conflict of interests between the practitioner’s ownership interests and the best interests of any patient, the practitioner shall not make a referral to such entity, but shall make alternative arrangements for the referral.D\n\nFurther, a practitioner may refer patients for health services to a publicly traded entity in which such practitioner has an investment interest without applying for or receiving an exception from the Department if all of the following conditions are met:1\n\nThe entity’s stock is listed for trading on the New York Stock Exchange or the American Stock Exchange or is a national market system security traded under an automated interdealer quotation system operated by the National Association of Securities Dealers;2\n\nThe entity had, at the end of the corporation’s most recent fiscal year, total net assets of at least $50 million related to the furnishing of health services;3\n\nThe entity markets and furnishes its services to practitioner-investors and other practitioners on the same and equal terms;4\n\nAll stock of the entity, including the stock of any predecessor privately held company, is one class without preferential treatment as to status or remuneration;5\n\nThe entity does not issue loans or guarantee any loans for practitioners who are in a position to refer patients to such entity;6\n\nThe income on the practitioner’s investment is not tied to referral volumes and is based on the practitioner’s equity interest in the entity; and7\n\nThe practitioner’s investment interest does not exceed one-half of one percent of the entity’s total equity.E\n\nIn addition, a practitioner may refer a patient to such practitioner’s immediate family member or such immediate family member’s office or group practice for health services if all of the following conditions are met:1\n\nThe health services to be received by the patient referred by the practitioner are within the scope of practice of the practitioner’s immediate family member or the treating practitioner within such immediate family member’s office or group practice;2\n\nThe practitioner’s immediate family member or the treating practitioner within such immediate family member’s office or group practice is qualified and duly licensed to provide the health services to be received by the patient referred to the practitioner;3\n\nThe primary purpose of any such referral is to obtain the appropriate professional health services for the patient being referred, which are to be rendered by the referring practitioner’s immediate family member or by the treating practitioner within such immediate family member’s office or group practice who is qualified and licensed to provide such professional health services; and4\n\nThe primary purpose of the referral shall not be for the provision of designated health services as defined in 42 U.S.C. § 1395nn and the regulations promulgated thereunder.","order_by":null,"text":{"0":{"id":297108,"text":"Unless the practitioner directly provides health services within the entity and will be personally involved with the provision of care to the referred patient, or has been granted an exception by the Department or satisfies the provisions of subsections D or E of this section or of subsections D or E of § 54.1-2413, a practitioner shall not refer a patient for health services to an entity outside the practitioner’s office or group practice if the practitioner or any of the practitioner’s immediate family members is an investor in such entity.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"B"},"1":{"id":297109,"text":"The Department may grant an exception to the prohibitions in this chapter, and may permit a practitioner to invest in and refer to an entity, regardless of whether the practitioner provides direct services within such entity, if there is a demonstrated need in the community for the entity and all of the following conditions are met:","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A","next_prefix":"B1"},"2":{"id":297110,"text":"Individuals other than practitioners are afforded a bona fide opportunity to invest in the entity on the same and equal terms as those offered to any referring practitioner;","type":"section","prefixes":["B","1"],"prefix":"1","entire_prefix":"B1","prefix_anchor":"B1","level":2,"prior_prefix":"B","next_prefix":"B2"},"3":{"id":297111,"text":"No investor-practitioner is required or encouraged to refer patients to the entity or otherwise generate business as a condition of becoming or remaining an investor;","type":"section","prefixes":["B","2"],"prefix":"2","entire_prefix":"B2","prefix_anchor":"B2","level":2,"prior_prefix":"B1","next_prefix":"B3"},"4":{"id":297112,"text":"The services of the entity are marketed and furnished to practitioner-investors and other investors on the same and equal terms;","type":"section","prefixes":["B","3"],"prefix":"3","entire_prefix":"B3","prefix_anchor":"B3","level":2,"prior_prefix":"B2","next_prefix":"B4"},"5":{"id":297113,"text":"The entity does not issue loans or guarantee any loans for practitioners who are in a position to refer patients to such entity;","type":"section","prefixes":["B","4"],"prefix":"4","entire_prefix":"B4","prefix_anchor":"B4","level":2,"prior_prefix":"B3","next_prefix":"B5"},"6":{"id":297114,"text":"The income on the practitioner’s investment is based on the practitioner’s equity interest in the entity and is not tied to referral volumes; and","type":"section","prefixes":["B","5"],"prefix":"5","entire_prefix":"B5","prefix_anchor":"B5","level":2,"prior_prefix":"B4","next_prefix":"B6"},"7":{"id":297115,"text":"The investment contract between the entity and the practitioner does not include any covenant or clause limiting or preventing the practitioner’s investment in other entities.\n\t\t\t\tUnless the Department, the practitioner, or the entity requests a hearing, the Department shall determine whether to grant or deny an exception within 90 days of the receipt of a written request from the practitioner or entity, stating the facts of the particular circumstances and certifying compliance with the conditions required by this subsection. The Department’s decision shall be a final administrative decision and shall be subject to judicial review pursuant to the Administrative Process Act (§ 2.2-4000 et seq.).","type":"section","prefixes":["B","6"],"prefix":"6","entire_prefix":"B6","prefix_anchor":"B6","level":2,"prior_prefix":"B5","next_prefix":"C"},"8":{"id":297116,"text":"When an exception is granted pursuant to subsection B:","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B6","next_prefix":"C1"},"9":{"id":297117,"text":"The practitioner shall disclose his investment interest in the entity to the patient at the time of referral. If alternative entities are reasonably available, the practitioner shall provide the patient with a list of such alternative entities and shall inform the patient of the option to use an alternative entity. The practitioner shall also inform the patient that choosing another entity will not affect his treatment or care;","type":"section","prefixes":["C","1"],"prefix":"1","entire_prefix":"C1","prefix_anchor":"C1","level":2,"prior_prefix":"C","next_prefix":"C2"},"10":{"id":297118,"text":"Information on the practitioner’s investment shall be provided if requested by any third party payor;","type":"section","prefixes":["C","2"],"prefix":"2","entire_prefix":"C2","prefix_anchor":"C2","level":2,"prior_prefix":"C1","next_prefix":"C3"},"11":{"id":297119,"text":"The entity shall establish and utilize an internal utilization review program to ensure that practitioner-investors are engaging in appropriate and necessary utilization; and","type":"section","prefixes":["C","3"],"prefix":"3","entire_prefix":"C3","prefix_anchor":"C3","level":2,"prior_prefix":"C2","next_prefix":"C4"},"12":{"id":297120,"text":"In the event of a conflict of interests between the practitioner’s ownership interests and the best interests of any patient, the practitioner shall not make a referral to such entity, but shall make alternative arrangements for the referral.","type":"section","prefixes":["C","4"],"prefix":"4","entire_prefix":"C4","prefix_anchor":"C4","level":2,"prior_prefix":"C3","next_prefix":"D"},"13":{"id":297121,"text":"Further, a practitioner may refer patients for health services to a publicly traded entity in which such practitioner has an investment interest without applying for or receiving an exception from the Department if all of the following conditions are met:","type":"section","prefixes":["D"],"prefix":"D","entire_prefix":"D","prefix_anchor":"D","level":1,"prior_prefix":"C4","next_prefix":"D1"},"14":{"id":297122,"text":"The entity’s stock is listed for trading on the New York Stock Exchange or the American Stock Exchange or is a national market system security traded under an automated interdealer quotation system operated by the National Association of Securities Dealers;","type":"section","prefixes":["D","1"],"prefix":"1","entire_prefix":"D1","prefix_anchor":"D1","level":2,"prior_prefix":"D","next_prefix":"D2"},"15":{"id":297123,"text":"The entity had, at the end of the corporation’s most recent fiscal year, total net assets of at least $50 million related to the furnishing of health services;","type":"section","prefixes":["D","2"],"prefix":"2","entire_prefix":"D2","prefix_anchor":"D2","level":2,"prior_prefix":"D1","next_prefix":"D3"},"16":{"id":297124,"text":"The entity markets and furnishes its services to practitioner-investors and other practitioners on the same and equal terms;","type":"section","prefixes":["D","3"],"prefix":"3","entire_prefix":"D3","prefix_anchor":"D3","level":2,"prior_prefix":"D2","next_prefix":"D4"},"17":{"id":297125,"text":"All stock of the entity, including the stock of any predecessor privately held company, is one class without preferential treatment as to status or remuneration;","type":"section","prefixes":["D","4"],"prefix":"4","entire_prefix":"D4","prefix_anchor":"D4","level":2,"prior_prefix":"D3","next_prefix":"D5"},"18":{"id":297126,"text":"The entity does not issue loans or guarantee any loans for practitioners who are in a position to refer patients to such entity;","type":"section","prefixes":["D","5"],"prefix":"5","entire_prefix":"D5","prefix_anchor":"D5","level":2,"prior_prefix":"D4","next_prefix":"D6"},"19":{"id":297127,"text":"The income on the practitioner’s investment is not tied to referral volumes and is based on the practitioner’s equity interest in the entity; and","type":"section","prefixes":["D","6"],"prefix":"6","entire_prefix":"D6","prefix_anchor":"D6","level":2,"prior_prefix":"D5","next_prefix":"D7"},"20":{"id":297128,"text":"The practitioner’s investment interest does not exceed one-half of one percent of the entity’s total equity.","type":"section","prefixes":["D","7"],"prefix":"7","entire_prefix":"D7","prefix_anchor":"D7","level":2,"prior_prefix":"D6","next_prefix":"E"},"21":{"id":297129,"text":"In addition, a practitioner may refer a patient to such practitioner’s immediate family member or such immediate family member’s office or group practice for health services if all of the following conditions are met:","type":"section","prefixes":["E"],"prefix":"E","entire_prefix":"E","prefix_anchor":"E","level":1,"prior_prefix":"D7","next_prefix":"E1"},"22":{"id":297130,"text":"The health services to be received by the patient referred by the practitioner are within the scope of practice of the practitioner’s immediate family member or the treating practitioner within such immediate family member’s office or group practice;","type":"section","prefixes":["E","1"],"prefix":"1","entire_prefix":"E1","prefix_anchor":"E1","level":2,"prior_prefix":"E","next_prefix":"E2"},"23":{"id":297131,"text":"The practitioner’s immediate family member or the treating practitioner within such immediate family member’s office or group practice is qualified and duly licensed to provide the health services to be received by the patient referred to the practitioner;","type":"section","prefixes":["E","2"],"prefix":"2","entire_prefix":"E2","prefix_anchor":"E2","level":2,"prior_prefix":"E1","next_prefix":"E3"},"24":{"id":297132,"text":"The primary purpose of any such referral is to obtain the appropriate professional health services for the patient being referred, which are to be rendered by the referring practitioner’s immediate family member or by the treating practitioner within such immediate family member’s office or group practice who is qualified and licensed to provide such professional health services; and","type":"section","prefixes":["E","3"],"prefix":"3","entire_prefix":"E3","prefix_anchor":"E3","level":2,"prior_prefix":"E2","next_prefix":"E4"},"25":{"id":297133,"text":"The primary purpose of the referral shall not be for the provision of designated health services as defined in 42 U.S.C. § 1395nn and the regulations promulgated thereunder.","type":"section","prefixes":["E","4"],"prefix":"4","entire_prefix":"E4","prefix_anchor":"E4","level":2,"prior_prefix":"E3"}},"ancestry":[{"id":13237,"edition_id":1,"name":"Practitioner Self-Referral Act","identifier":"24.1","label":"chapter","depth":3,"order_by":1,"parent_id":12758,"metadata":{},"date_created":"2026-06-26 03:44:30","date_modified":"2026-06-26 03:44:30","permalink":{"id":241285,"object_type":"structure","relational_id":13237,"identifier":"24.1","token":"54.1\/III\/24.1","url":"\/54.1\/III\/24.1\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12758,"edition_id":1,"name":"Professions and Occupations Regulated by Boards Within the Department of Health Professions","identifier":"III","label":"subtitle","depth":2,"order_by":1,"parent_id":12754,"metadata":{},"date_created":"2026-06-26 03:43:51","date_modified":"2026-06-26 03:43:51","permalink":{"id":241105,"object_type":"structure","relational_id":12758,"identifier":"III","token":"54.1\/III","url":"\/54.1\/III\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12754,"edition_id":1,"name":"Professions and Occupations","identifier":"54.1","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:51","date_modified":"2026-06-26 03:43:51","permalink":{"id":239313,"object_type":"structure","relational_id":12754,"identifier":"54.1","token":"54.1","url":"\/54.1\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":87158,"structure_id":13237,"section_number":"54.1-2410","catch_line":"Definitions","url":"\/54.1-2410\/","token":"54.1\/III\/24.1\/54.1-2410","metadata":false},{"id":82894,"structure_id":13237,"section_number":"54.1-2411","catch_line":"Prohibited referrals and payments; exceptions","url":"\/54.1-2411\/","token":"54.1\/III\/24.1\/54.1-2411","metadata":false},{"id":63182,"structure_id":13237,"section_number":"54.1-2412","catch_line":"Department to administer; powers and duties of Department; penalties for violation","url":"\/54.1-2412\/","token":"54.1\/III\/24.1\/54.1-2412","metadata":false},{"id":86817,"structure_id":13237,"section_number":"54.1-2413","catch_line":"Additional conditions related to practitioner-investors","url":"\/54.1-2413\/","token":"54.1\/III\/24.1\/54.1-2413","metadata":false},{"id":54241,"structure_id":13237,"section_number":"54.1-2414","catch_line":"Applicability of chapter; grace period for compliance","url":"\/54.1-2414\/","token":"54.1\/III\/24.1\/54.1-2414","metadata":false}],"previous_section":{"id":87158,"structure_id":13237,"section_number":"54.1-2410","catch_line":"Definitions","url":"\/54.1-2410\/","token":"54.1\/III\/24.1\/54.1-2410","metadata":false},"next_section":{"id":63182,"structure_id":13237,"section_number":"54.1-2412","catch_line":"Department to administer; powers and duties of Department; penalties for violation","url":"\/54.1-2412\/","token":"54.1\/III\/24.1\/54.1-2412","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/54.1-2411\/","history_text":"

This law was first created in 1993. The record of its establishment is cataloged in chapter 869 of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. Unfortunately, the 1993 \u201cActs\u201d aren\u2019t available online. It has been modified 2 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 2005, chapter 402<\/a>; in 2025, chapter 341<\/a>.<\/p>","references":[{"id":63182,"section_number":"54.1-2412","catch_line":"Department to administer; powers and duties of Department; penalties for violation","order_by":null,"url":"\/54.1-2412\/"}],"refers_to":[{"id":86911,"section_number":"2.2-4000","catch_line":"Short title; purpose","order_by":null,"url":"\/2.2-4000\/"},{"id":86817,"section_number":"54.1-2413","catch_line":"Additional conditions related to practitioner-investors","order_by":null,"url":"\/54.1-2413\/"}],"permalink":{"id":241291,"object_type":"law","relational_id":82894,"identifier":"54.1-2411","token":"54.1\/III\/24.1\/54.1-2411","url":"\/54.1-2411\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/54.1-2411\/","token":"54.1\/III\/24.1\/54.1-2411","dublin_core":{"Title":"Prohibited referrals and payments; exceptions","Type":"Text","Format":"text\/html","Identifier":"\u00a7 54.1-2411","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> Unless the practitioner<\/span> directly provides health services<\/span> within the entity<\/span> and will be personally involved with the provision of care to the referred patient, or has been granted an exception by the Department<\/span> or satisfies the provisions of subsections D or E of this section or of subsections D or E of § 54.1-2413<\/a>, a practitioner<\/span> shall not refer a patient for health services<\/span> to an entity<\/span> outside the practitioner<\/span>’s office or group practice<\/span> if the practitioner<\/span> or any of the practitioner<\/span>’s immediate family members<\/span> is an investor<\/span> in such entity<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> The Department<\/span> may grant an exception to the prohibitions in this chapter, and may permit a practitioner<\/span> to invest in and refer to an entity<\/span>, regardless of whether the practitioner<\/span> provides direct services within such entity<\/span>, if there is a demonstrated need<\/span> in the community<\/span> for the entity<\/span> and all of the following conditions are met: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> Individuals other than practitioners<\/span> are afforded a bona fide opportunity to invest in the entity<\/span> on the same and equal terms as those offered to any referring practitioner<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> No investor<\/span>-practitioner<\/span> is required or encouraged to refer patients to the entity<\/span> or otherwise generate business as a condition of becoming or remaining an investor<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> The services of the entity<\/span> are marketed and furnished to practitioner<\/span>-investors<\/span> and other investors<\/span> on the same and equal terms; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

4.<\/span> The entity<\/span> does not issue<\/span> loans or guarantee any loans for practitioners<\/span> who are in a position to refer patients to such entity<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

5.<\/span> The income on the practitioner<\/span>’s investment is based on the practitioner<\/span>’s equity<\/span> interest in the entity<\/span> and is not tied to referral<\/span> volumes; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

6.<\/span> The investment contract<\/span> between the entity<\/span> and the practitioner<\/span> does not include any covenant or clause limiting or preventing the practitioner<\/span>’s investment in other entities.\n\t\t\t\tUnless the Department<\/span>, the practitioner<\/span>, or the entity<\/span> requests a hearing<\/span>, the Department<\/span> shall determine whether to grant or deny an exception within 90 days of the receipt of a written request from the practitioner<\/span> or entity<\/span>, stating the facts<\/span> of the particular circumstances and certifying compliance with the conditions required by this subsection. The Department<\/span>’s decision shall be a final administrative decision and shall be subject to judicial review pursuant to the Administrative Process Act (§ 2.2-4000<\/a> et seq.). <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> When an exception is granted pursuant to subsection B: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> The practitioner<\/span> shall disclose his investment interest<\/span> in the entity<\/span> to the patient at the time of referral<\/span>. If alternative entities are reasonably available, the practitioner<\/span> shall provide the patient with a list of such alternative entities and shall inform the patient of the option to use an alternative entity<\/span>. The practitioner<\/span> shall also inform the patient that choosing another entity<\/span> will not affect his treatment or care; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> Information on the practitioner<\/span>’s investment shall be provided if requested by any third party<\/span> payor; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> The entity<\/span> shall establish and utilize an internal utilization review program to ensure that practitioner<\/span>-investors<\/span> are engaging in appropriate and necessary utilization; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

4.<\/span> In the event of a conflict of interests<\/span> between the practitioner<\/span>’s ownership interests and the best interests of any patient, the practitioner<\/span> shall not make a referral<\/span> to such entity<\/span>, but shall make alternative arrangements for the referral<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

D.<\/span> Further, a practitioner<\/span> may refer patients for health services<\/span> to a publicly traded entity<\/span> in which such practitioner<\/span> has an investment interest<\/span> without applying for or receiving an exception from the Department<\/span> if all of the following conditions are met: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> The entity<\/span>’s stock is listed for trading on the New York Stock Exchange or the American Stock Exchange or is a national market system security traded under an automated interdealer quotation system operated by the National Association of Securities Dealers; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> The entity<\/span> had, at the end of the corporation’s most recent fiscal year, total net assets<\/span> of at least $50 million related to the furnishing of health services<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> The entity<\/span> markets and furnishes its services to practitioner<\/span>-investors<\/span> and other practitioners<\/span> on the same and equal terms; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

4.<\/span> All stock of the entity<\/span>, including the stock of any predecessor privately held company, is one class without preferential treatment as to status or remuneration; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

5.<\/span> The entity<\/span> does not issue<\/span> loans or guarantee any loans for practitioners<\/span> who are in a position to refer patients to such entity<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

6.<\/span> The income on the practitioner<\/span>’s investment is not tied to referral<\/span> volumes and is based on the practitioner<\/span>’s equity<\/span> interest in the entity<\/span>; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

7.<\/span> The practitioner<\/span>’s investment interest<\/span> does not exceed one-half of one percent of the entity<\/span>’s total equity<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

E.<\/span> In addition, a practitioner<\/span> may refer a patient to such practitioner<\/span>’s immediate family member<\/span> or such immediate family member<\/span>’s office or group practice<\/span> for health services<\/span> if all of the following conditions are met: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> The health services<\/span> to be received by the patient referred by the practitioner<\/span> are within the scope of practice of the practitioner<\/span>’s immediate family member<\/span> or the treating practitioner<\/span> within such immediate family member<\/span>’s office or group practice<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> The practitioner<\/span>’s immediate family member<\/span> or the treating practitioner<\/span> within such immediate family member<\/span>’s office or group practice<\/span> is qualified and duly licensed to provide the health services<\/span> to be received by the patient referred to the practitioner<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> The primary purpose of any such referral<\/span> is to obtain the appropriate professional health services<\/span> for the patient being referred, which are to be rendered by the referring practitioner<\/span>’s immediate family member<\/span> or by the treating practitioner<\/span> within such immediate family member<\/span>’s office or group practice<\/span> who is qualified and licensed to provide such professional health services<\/span>; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

4.<\/span> The primary purpose of the referral<\/span> shall not be for the provision of designated health services<\/span> as defined in 42 U.S.C. § 1395nn and the regulations promulgated thereunder. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nPROHIBITED REFERRALS AND PAYMENTS; EXCEPTIONS (\u00a7 54.1-2411)\n\nA. Unless the practitioner directly provides health services within the entity\nand will be personally involved with the provision of care to the referred\npatient, or has been granted an exception by the Department or satisfies the\nprovisions of subsections D or E of this section or of subsections D or E of\n§ 54.1-2413, a practitioner shall not refer a patient for health services\nto an entity outside the practitioner’s office or group practice if the\npractitioner or any of the practitioner’s immediate family members is an\ninvestor in such entity.\n\nB. The Department may grant an exception to the prohibitions in this chapter,\nand may permit a practitioner to invest in and refer to an entity, regardless of\nwhether the practitioner provides direct services within such entity, if there\nis a demonstrated need in the community for the entity and all of the following\nconditions are met:\n\n 1. Individuals other than practitioners are afforded a bona fide opportunity\n to invest in the entity on the same and equal terms as those offered to any\n referring practitioner;\n\n 2. No investor-practitioner is required or encouraged to refer patients to the\n entity or otherwise generate business as a condition of becoming or remaining\n an investor;\n\n 3. The services of the entity are marketed and furnished to\n practitioner-investors and other investors on the same and equal terms;\n\n 4. The entity does not issue loans or guarantee any loans for practitioners\n who are in a position to refer patients to such entity;\n\n 5. The income on the practitioner’s investment is based on the\n practitioner’s equity interest in the entity and is not tied to referral\n volumes; and\n\n 6. The investment contract between the entity and the practitioner does not\n include any covenant or clause limiting or preventing the practitioner’s\n investment in other entities.\n \t\t\t\tUnless the Department, the practitioner, or the entity requests a hearing,\n the Department shall determine whether to grant or deny an exception within 90\n days of the receipt of a written request from the practitioner or entity,\n stating the facts of the particular circumstances and certifying compliance\n with the conditions required by this subsection. The Department’s\n decision shall be a final administrative decision and shall be subject to\n judicial review pursuant to the Administrative Process Act (§ 2.2-4000 et\n seq.).\n\nC. When an exception is granted pursuant to subsection B:\n\n 1. The practitioner shall disclose his investment interest in the entity to\n the patient at the time of referral. If alternative entities are reasonably\n available, the practitioner shall provide the patient with a list of such\n alternative entities and shall inform the patient of the option to use an\n alternative entity. The practitioner shall also inform the patient that\n choosing another entity will not affect his treatment or care;\n\n 2. Information on the practitioner’s investment shall be provided if\n requested by any third party payor;\n\n 3. The entity shall establish and utilize an internal utilization review\n program to ensure that practitioner-investors are engaging in appropriate and\n necessary utilization; and\n\n 4. In the event of a conflict of interests between the practitioner’s\n ownership interests and the best interests of any patient, the practitioner\n shall not make a referral to such entity, but shall make alternative\n arrangements for the referral.\n\nD. Further, a practitioner may refer patients for health services to a publicly\ntraded entity in which such practitioner has an investment interest without\napplying for or receiving an exception from the Department if all of the\nfollowing conditions are met:\n\n 1. The entity’s stock is listed for trading on the New York Stock\n Exchange or the American Stock Exchange or is a national market system\n security traded under an automated interdealer quotation system operated by\n the National Association of Securities Dealers;\n\n 2. The entity had, at the end of the corporation’s most recent fiscal\n year, total net assets of at least $50 million related to the furnishing of\n health services;\n\n 3. The entity markets and furnishes its services to practitioner-investors and\n other practitioners on the same and equal terms;\n\n 4. All stock of the entity, including the stock of any predecessor privately\n held company, is one class without preferential treatment as to status or\n remuneration;\n\n 5. The entity does not issue loans or guarantee any loans for practitioners\n who are in a position to refer patients to such entity;\n\n 6. The income on the practitioner’s investment is not tied to referral\n volumes and is based on the practitioner’s equity interest in the\n entity; and\n\n 7. The practitioner’s investment interest does not exceed one-half of\n one percent of the entity’s total equity.\n\nE. In addition, a practitioner may refer a patient to such practitioner’s\nimmediate family member or such immediate family member’s office or group\npractice for health services if all of the following conditions are met:\n\n 1. The health services to be received by the patient referred by the\n practitioner are within the scope of practice of the practitioner’s\n immediate family member or the treating practitioner within such immediate\n family member’s office or group practice;\n\n 2. The practitioner’s immediate family member or the treating\n practitioner within such immediate family member’s office or group\n practice is qualified and duly licensed to provide the health services to be\n received by the patient referred to the practitioner;\n\n 3. The primary purpose of any such referral is to obtain the appropriate\n professional health services for the patient being referred, which are to be\n rendered by the referring practitioner’s immediate family member or by\n the treating practitioner within such immediate family member’s office\n or group practice who is qualified and licensed to provide such professional\n health services; and\n\n 4. The primary purpose of the referral shall not be for the provision of\n designated health services as defined in 42 U.S.C. § 1395nn and the\n regulations promulgated thereunder.\n\nHISTORY: 1993, c. 869; 2005, c. 402; 2025, c. 341.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}