ADA Issues Warning to Dentists Regarding Groupons

The American Dental Association (ADA) recently analyzed the legal implications for dentists advertising on Groupon or other social media companies.  We discussed this issue in our recent post here.

The ADA’s memo identified several potential federal and state laws and regulations that dentists advertising on Groupons may violate. Additionally, like other legal experts, the ADA is concerned about the lack of authoritative guidance on the subject. Dentists advertising on Groupon, says the ADA, may potentially run afoul of the following laws and regulations:

  • prohibition that many states have against awarding gifts as method of soliciting patients,
  • prohibition many states have against fee splitting between a dentist and a third party (revenue generated through Groupon would be split between the dentist and the company),
  • federal anti-kickback statute that prohibit dentists from offering or paying money to encourage a person to refer a patient that may be eligible for services under a federal healthcare program,
  • the method of advertising itself raises a concern for those dentists in jurisdictions which set specific ad requirements,
  • possible third-party contract violations (some insurance companies’ contracts require the dentist to provide the best price for a particular service to insureds; insurance companies could invoke this clause to compel a dentist to offer Groupon discounts to all patients covered by that insurance),
  • ethical implications (possible violations of the ADA ethics code which states that a dentist may not “accept or tender ‘rebates’ or ‘split’ fees”).

The ADA warns that a dentist who violates state regulations could face censure and reprimand, fines, suspension or license revocation. There are also penalties for violating the federal law, which include, a possible felony charge, fines, imprisonment and exclusion from federal health care programs.

Similar to what others have previously written on the subject, the ADA warned dentists to wait to participate in Groupon until clear guidance is provided by the federal government or the courts, and in case providers have questions, consult with an attorney familiar with such issues.

If you have questions regarding social media advertising for doctors or dentists or require other legal assistance, please contact us.