Dental marketing legal issues exist when thinking of offering referral gifts and rewards to existing patients. In addition, offering discounts through programs like Groupon to patients is another area of concern. We advise that you consult an attorney who is an expert with regard to these types of issues in the state that your dental practice exists.
Can a dentist offer a gift in exchange for a patient referral
Referral Gifts
Depending on what state your practice is located in, you make be prohibited from directly offering a gift to a patient for referring new patients to your practice. Both the states of Illinois and Texas have broad laws that restrict any type of reward for receiving a new patient via a referral. In contrast to Illinois and Texas, New Jersey sets a limit to the value of a gift or reward for a referral to $25. Another interpretation we see is that offering “rebates” or “fee splitting”, such as in Arizona, falls under the same umbrella as giving gifts and therefore considered illegal.
These laws are complex and this is why it is critical to consult a legal expert familiar with the laws in your state. The ADA is another good resource consult on this issue offering rewards for referrals.
Patient Discount Programs, Groupon
Programs such as Groupon fall into the category referenced above, fee splitting. In this scenario, the dentist pays a 3rd party a percentage of the revenue generated from the new patient. Some have argued that programs such as Groupon does not violate any of these laws as they are providing an advertisement service.
The complexity of this arrangement, and the different interpretations of these laws from state to state, may require legal consultation. However, we would like to point out that paying an agency to run an advertising program on your behalf is a different scenario as the agency is not and should not be paid based up volume or value of new patients generated.
Dental Services Discount Advertising
This is another area where laws and regulations differ based on the location of your practice. One state that has unique regulations is the state of Florida.
The Florida regulation requires a disclosure and that disclosure is as follows:
(1) An appropriate disclosure regarding advertised fees is necessary to protect the
public since there is no uniform code available which would enable a fair and rational
selection based upon advertised fees.
(2) Any advertisement containing fee information shall contain a disclaimer that the fee
is a minimum fee only.
(3) Any advertised fee for a dental service shall state a specified period during which
the fee is in effect or that service shall remain available at or below the advertised fee
for at least 90 days following the final advertisement for that service.
(4) Any dental service for which a fee is advertised shall be accompanied either by a
description of that service using the exact wording for that service contained in the
American Dental Association’s “Code on Dental Procedures and Nomenclature”.
Fla. Admin. Code Ann. R. 64B5-4.003.
As part of these regulation, Florida as requires that text below is included with any advertisement that offers a discount:
THE PATIENT AND ANY OTHER PERSON RESPONSIBLE FOR PAYMENT HAS A
RIGHT TO REFUSE TO PAY, CANCEL PAYMENT, OR BE REIMBURSED FOR
PAYMENT FOR ANY OTHER SERVICE, EXAMINATION, OR TREATMENT THAT IS
PERFORMED AS A RESULT OF AND WITHIN 72 HOURS OF RESPONDING TO
THE ADVERTISEMENT FOR THE FREE, DISCOUNTED FEE, OR REDUCED FEE
SERVICE, EXAMINATION, OR TREATMENT.
This statement as needs to be in all caps and easily seen in the advertisement.
Dental Marketing Legal Issues and Ethics
ADS Ethics Code
The offering of grifts and discounts can also land you in hot water with the ADS per the ADA Ethics Code:
Section 4.E. of the ADA Principles of Ethics and Code of Professional
Conduct (the “ADA Ethics Code”), a dentist may not “accept or tender ‘rebates’ or ‘split fees.’”
It is important to point out that this code is not mandatory for all dentists, rather it is a condition of membership to the ADA.
Dental Marketing Legal Issues Summary
The legal issues are complex and vary from state to state. It is critical for you, the owner of your dental practice to consult a legal expert familiar with both the laws of your state and federal law when it comes to offering gifts or discounts for the referral of new patients. However, as programs such as Groupon gain in popularity, regulations may change. Always get an up-to-date legal opinion when approached or considering these marketing programs.
It is also important to emphasize that using digital advertising and any means of advertising of your dental practice is not problematic as long as you are not paying an agency based upon volume and or revenue generated.