Preventing compliance issues and penalties associated with protocols such as Stark Laws and Anti-Kickback statutes begins with knowing where the issues may lie. Lease agreements contain hundreds of data points, some of which are essential for compliance efforts and for effective portfolio management. Tracking and monitoring the essential data facilitates compliance efforts – internally with the lease agreements themselves, and externally with public standards including Stark I and II, Anti-Kickback, lease accounting, and others.
One subset of essential lease data is critical dates. In broad terms, critical dates are those that are tied to specific events that occur throughout the lease term. They include the following:
- Lease Date
- Possession Date
- Substantial Completion Date
- Lease Commencement Date
- Rent Commencement Date
- Rent Increase Dates
- Rent Abatement Dates
- Move Out Date (real estate)
- Return Date (equipment)
- Lease Expiration Date
- Lease Option Date
- Option Notification Date
- Option Effective Date
- Renewal Term Commencement (real estate)
- Renewal Term Expiration (real estate)
- Evergreen Commencement (equipment)
- Evergreen Expiration (equipment)
Dates are often the triggers for key actions taken by either the lessor or the lessee. As a tenant, move in cannot occur prior to lease commencement. Additionally, if you haven’t vacated the premises by the expiration date, you could be put into holdover status by the lessor, resulting in increased rent or a penalty. As a lessor, if rents are scheduled to increase as of a certain date, income could be affected by not monitoring the date and billing timely for the increase. In the case of complying with Stark Laws, occasionally ignoring or forgetting the rent increase or expiration dates could lead to an unintended compliance issue.
Are you sure that you are capturing all essential data and critical dates for lease and regulatory compliance? Scribcor helps healthcare clients assess data quality and manage lease data, applying client-centric processes that ease uncertainty so you can Know. Right. Now. If you would like to learn more, visit us at https://scribcorglobal.com/healthcare/.