Structure a Hospital-Oncologist Joint-Venture Cancer Center

1. 1

   Start with the Stark Law analysis

   The federal physician self-referral law (Stark Law) restricts a physician from referring Medicare patients for certain services to an entity the physician has a financial relationship with, unless an exception applies. This is why these joint ventures often center on radiation oncologists rather than medical oncologists, whose self-referral exposure is different. Structure the entire deal around a healthcare attorney's Stark and anti-kickback analysis; this is not optional and not a place to improvise.

2. 2

   Define the co-ownership and governance terms

   Decide the ownership split between the hospital and the physicians, the governance rights, and how decisions and profits are shared. These terms determine whether physicians feel genuine alignment or merely employment with extra paperwork. A well-drafted operating agreement is the backbone of the venture.

3. 3

   Site and build the outpatient cancer center

   Joint ventures typically build a dedicated outpatient facility with radiation equipment, imaging, and infusion capacity. Capital is shared across the partners, which is part of the appeal for physicians who could not fund it alone. Facility licensing and accreditation apply as they would to any cancer center.

4. 4

   Align clinical operations and referrals within the law

   The center must operate so that referrals and clinical decisions comply with self-referral and anti-kickback rules while still delivering the coordinated care the JV was formed to provide. Compliance monitoring is ongoing, not a one-time sign-off. Document medical necessity and referral patterns carefully.

5. 5

   Plan the payer and Medicare strategy

   The JV entity contracts with payers and enrolls with Medicare on its own terms, which may differ from either partner's existing contracts. Reimbursement design interacts with the ownership structure. Bring payer-contracting expertise into the deal early.

6. 6

   Build in exit and unwind provisions

   Joint ventures end, whether through buyout, acquisition, or dissolution, and the agreement must say how. Physician turnover, hospital strategy shifts, and regulatory change all pressure these structures over time. Clear exit terms protect both sides and make the venture financeable.

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Best for: Hospital executives and radiation oncologists structuring an aligned outpatient center

Not for: Anyone unwilling to build the deal around a healthcare attorney's Stark analysis, and anyone without a hospital partner and physician group to co-own the venture. This is not a solo build.