This bill expands flexibilities for physicians and physician-owned hospitals under the Stark law (i.e., the Physician Self-Referral Law). 

The Stark law generally prohibits physicians from referring patients to receive services that are payable under Medicare or Medicaid from entities in which the physician or an immediate family member has a financial relationship. The bill allows physicians or their immediate family members to have financial interests in rural hospitals that are located more than 35 miles (or 15 miles in certain mountainous areas or areas with only secondary roads) from a hospital or critical access hospital.

The Stark law also generally prohibits physician-owned hospitals from expanding the number of operating rooms, procedure rooms, or beds beyond the number in existence as of March 23, 2010, in order to be excepted under the Stark law. The bill removes this restriction.