Using Groupon to promote services? Beware legal risks

In an effort to boost sales and bolster word-of-mouth (or mouse) marketing, a number of practices have begun offering deep discounts on services through websites such as Groupon and Living Social. Typically, the discounts offer at least half off high-priced, self-pay services, such as teeth-whitening or Lasik surgery and are designed to lure patients into a practice so they'll become repeat customers and possibly refer their friends. But with the trend still in its infancy, some attorneys warn that physicians offering deals through such sites could be breaking the law.

The primary risk to physicians is that they may run afoul of anti-kickback laws, which forbid health professionals from paying or giving anything of value to someone--including a website--for sending them a patient, explains an article in the Florida Sun Sentinel. With a typical Groupon promotion, for example, the website would reap about half of the revenue generated from a given offer. Therefore, the revenue split would vary depending on the volume of business, constituting a kickback.

To avoid this pitfall, David Harlow, an attorney from Newton, Mass., recently told American Medical News that physicians must ensure that the service is not covered by traditional or federally funded insurance. Even if it's a federally covered individual paying for the treatment out of pocket and the physician is enrolled in a federally funded program, there could be legal risks, he warned.

And when it comes to private payers, many have stipulations in their contracts guaranteeing that they have the best price, the article said. In a worst-case scenario, the physician could be forced to offer all services at the reduced price offered on the group-coupon site, attorneys told amednews.

So far, although no states are known to punish medical professionals for online discounts, two medical boards in Oregon have banned dentists and chiropractors from giving Groupon-style discounts, the Sentinel reports. And while Medicare and the American Medical Association have taken no position on the issue, a number of national and local medical associations have warned members that there is still doubt as to whether such discounts are legal.

To learn more:
- read the article from the Sun Sentinel
- check out the article from American Medical News

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