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Hi, everyone. This is Michael Miscoe with Miscoe Health Law for this week’s installment of ChiroSecure’s Growth Without Risk presentation program. And today, we’re going to talk about something a little bit different. Off the beaten path, we usually talk about coding and compliance stuff. Today, I’m going to talk about a different compliance topic, and that has to do with marketing.
There are a number of marketing compliance risks, depending on the nature of your practice, and we’ll start out with the most obvious one, and that is federal and state anti kickback issues. Now, the anti kickback and Stark laws are federal laws. The anti kickback statute precludes the offering or receiving of remuneration, which is anything of value, in exchange for referrals.
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The Stark statute works the same except referrals, it addresses referrals for what are called designated health services, and there’s a laundry list of them, and to an entity that you have an ownership interest, direct or indirect, and the analysis of the indirect ownership interest gets a little complicated.
Now, from a federal statutory perspective, if you don’t bill Medicare, federal health care programs, obviously you’d have no potential issues and understand that any health care services that are funded even in part directly or indirectly from federal health care program dollars triggers federal Starken and a kickback liability.
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Now, the interesting thing is there’s probably federal money claims. That you’re paid for that you don’t realize are federal money claims. The Federal Employee Health Benefits Program, usually managed by your local blues carrier. If you have an employee that, that works for the post office or works for some federal government agency and is employed.
and is insured under the Federal Employee Health Benefits Program, that’s a federal health care program, you would have compliance risk. Medicare, Medicaid, obvious. Medicaid is a state program, but it’s funded in part by federal health care program dollars. Medicare Advantage is administered by local commercial insurance companies, funded by federal health care program dollars indirectly.
So all of those have Federal Stark and Anti Kickback Liability. Now, what a number of states have done in order to increase their cost share of recoveries under Medicaid is, because that money usually goes back to the federal government, the, if they have adopted Federal Stark and Anti Kickback compliant state statutes, so basically what we call Mini Stark or Mini Anti Kickback or State Stark, State Anti Kickback statutes.
Then they can increase their cost share, so you have Stark and Anti Kickback liability at the state level as well for your commercial insurance. Products, PIP or COMP, your regular health insurance benefits, many times funded by the patient’s employer. So any service that leads to a third party claim, and let me back up a minute, I believe the number of states that have adopted the federal and state, or I’m sorry, federal Stark and Anticipate Back Compliance state statutes is in the 30s.
I believe the number is 32. A number of other states have non compliant Stark and anti kickback statutes, meaning they don’t comply exactly with the federal version but they nonetheless have statutory provisions that preclude kickbacks basically money for referrals Sometimes you’ll see those in the nature of runner statutes.
That’s usually in the PIP realm. Essentially, what happens there is you’re paying somebody to identify patients who have been injured in an auto accident and refer them to your practice, or you’re using a marketing company to do that. So be careful, because as your agent, that can get you in trouble as well.
Nonetheless, if you’re unsure about kickback liability or stark liability. In your state, it’s a very simple Google search to find out if your state has such statutes. Most do. Even where they’re not compliant with the federal anti kickback or Stark statutes, they nonetheless prohibit referrals for remuneration.
Now, What about cash services is big in favor of cash practice concepts for compliance reasons, and you have practices that are all cash, and then you have practices that are some cash. And when you’re doing cash services, obviously, These rules don’t apply because there’s no third party billing involved.
These are basically financial agreements between you and the patient and these concepts don’t arise. However, if you’re going to market differently for your cash practice than you market for your insurance practice, you can’t, number one, use your cash practice as a feeder for your insurance practice because those become indirect.
Referrals and what referral or kickback am I talking about? When you offer incentives to a patient to select you as a provider, it’s normally classified as an inducement, but it’s a special type of kickback where the kickback is actually going to the patient. for their referral. Remember, the anti kickback statute prohibits offering or receiving.
If you’re offering a kickback to get patients, let’s assume it’s a business worthy endeavor. My, my favorite joke about marketing is if you were offering free 5, 000 gas cards for every patient to become a new patient, how many would you get? And the answer is all of them. And as long as they’re just paying cash for services.
ever, then that’s fine. You can do that. It may not make good business sense to do it, but It would be an effective marketing tool. The problem is that when you incentivize patients to select you and you start them out cash and then all of a sudden they have an air quote injury or whatever and you turn them into an insurance patient.
That gets problematic because the insurer looks at it from the perspective of did the offer of remuneration influence patient selection and lead to a bill to them that they otherwise wouldn’t have gotten. Now, it’s a much clearer scenario when you induce a patient and then they come in and you start billing.
The free exam and x ray offers, and even when you don’t bill the insurance company for the exam and x ray, Because you said it was free, got something, and it led to a claim to an insurance company that they may, might otherwise not have gotten. And even if they would, it doesn’t matter. Okay? The offer is enough to cook you.
So you need to be very careful in your marketing. If you do any third party reimbursement, Or third party claims. When third party, you’re the first party, the patient’s second, the insurance company’s the third. If you’re taking money from anybody other than the patient that is an insurance company, then you need to be very cautious in your marketing.
My, my advice for marketing is market conditions, market, What capabilities you have, market your experience, but do not incentivize patients to select your practice. If you’re all cash, you submit no third party claims. You can do whatever the heck you want within the limits of your licensure. requirements.
And those fundamentally prohibit you from misleading a patient. So you can’t make claims that you can’t support. This is the greatest treatment since the invention of the wheel, or it cures this or cures that. You can’t market outcomes. You need to be very cautious with testimonials, even in a cash practice, because to the extent the testimonial suggests something that you’re doing that’s out of your scope of practice, or suggests something that you’re A, an outcome that you may or may not be able to achieve.
Those have to come with big disclaimers. I’m not a big fan of testimonial marketing. I know it’s effective, but you have to be very careful putting out what a patient says. If they’re saying, Hey, he’s a great doc. They look after my needs. They take great care of me. Super. I’ve seen testimonials where the doc’s nutrition program, it reduced my A1C and cured my diabetes.
Absolutely not. Pretty broad spectrum there, and there’s a lot that could go in between. But before you put a testimonial up, make sure you look at it from the standpoint of whether your state board is going to think it’s misleading or not, or going to lead somebody into the belief that you can do something that you may or may not be able to do.
Finally, we need to talk about compensation issues, especially, and there’s two types of scenarios where you either have in house marketing staff that you employ or you have contracted folks, either individuals or entities that are going to market for you. Let’s talk about employed marketing people, which is the better way to go, especially if you want to compensate your marketing folks based upon the value of the referrals that they generate.
Now, again, in an all cash practice I don’t have any concern. If you do any insurance, however, now I’m concerned that if the volume or value of referrals if you’re spiffing your marketing staff based upon volume or value of referrals, the only thing that saves you under the Stark and Kickback statute and or their state counterparts is if you have, if the marketing people are bona fide employees.
You want to look at the employment arrangements, have those evaluated by Transactional Council to ensure that they’re compliant so that you can, in fact, bonus your employees based upon the volume or value of the referrals that they generate to your practice. Again, if you’re cash, it doesn’t matter because there’s no third party claims, therefore, no trigger for Starker Anti Kickback Analysis.
Now, if you’re contracting either an entity Or an individual to market for you, a 1099 air quote employee. The bonafide employment exception does not apply. It certainly does not apply to an agency. The only way that you can pay them is like you pay the Yellow Pages or any other type of advertising venue.
You’re going to do a contract for them to market. They’re going to spend so many hours that they’re going to do what they’re going to do. You can pay them by the hour, but there must be. A per diem style rate. So much per month, so much per hour, so much per week or day. And you cannot incentivize them based upon the referrals that they generate.
That’s just their job. You don’t pay a SPF to the Yellow Pages, assuming that people still use the Yellow Pages, but the, maybe I’m showing my age here, but you can’t pay a SPF To the yellow pages and you don’t pay a SPF to the yellow pages fixed fee. You pay it and you hope it works. And if it doesn’t work, you quit doing it.
Same thing with marketing, contracted marketing agencies and whatnot. They’re either doing the job for you at the price that you’ve agreed to pay. And it’s valuable to you or they’re not doing it and you move on and you try somebody else. You cannot, when you have insurance billing, you cannot get into incentivized compensation arrangements with marketing staff unless they’re bona fide employees.
I think that covers everything that I wanted to cover. Be very careful in your marketing. Very rarely does marketing create an issue unless you’re marketing things that are off label or whatever and you’re going to get FDA scrutiny, but. It’s usually a component or something that, especially if you’re still billing, your marketing can lead a payer to get interested in you.
Certainly, if they are interested in you, they will look at your marketing and it will help form their opinion of your practice and could color how the audit result comes out. Be cautious, keep it clean, and unfortunately, I will tell you some of the most effective marketing strategies. are also some of the most problematic from a compliance perspective.
So if it’s something that really works great, it’s probably something you want to have looked at. And there’s one other thing to think of. It’s, I’m aware that there are marketing companies out there that market if we don’t get you a certain number of patients, you don’t have to pay us. And that is a volume value referral type arrangement.
And if they’re an outside marketing company, they’re not a bona fide employee, and you bill insurance, it could be problematic, and you probably want to get it looked at by a compliance counsel. If you’re an all cash practice, I have less concern about it. Just look at it under state law, just to make sure that there’s no state law issue there.
And there likely will not be, again, if you’re all non covered services for cash, and let’s be sure we understand what cash means. It means you perform non covered services, the patient pays, and no claim is submitted by either you or the patient for reimbursement to a third party. And if that’s the case and it’s just you, the patient, they pay you, it’s over, no claims, then you’re a cash practice.
If claims are going out and the patient’s submitting them, you’ve still got risk and you need to be cautious. That’s all we have time for today. I hope this was helpful and we’ll see you next time.
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