Many medical and dental boards, as well as professional organizations, received numerous questions from their members concerning the appropriateness of physician advertising on Groupon, LivingSocial or similar social marketers. Last year, the American Dental Association (ADA) warned its members of the potential legal pit-falls associated with groupon-type advertising. The ADA Council on Ethics has now amended its Code of Ethics to address such advertisement arrangements.
Last year, the ADA Council on Ethics, Bylaws and Judicial Affairs issued an advisory opinion (4.E.1, Split Fees in Adverting and Marketing Services) that directly speaks to the issue of “social coupons.”
The Advisory Opinion provides that:
The prohibition against a dentist’s accepting or tendering rebates or split fees applies to business dealings between dentists and any third party, not just other dentists. Thus, a dentist who pays for advertising or marketing services by sharing a specified portion of the professional fees collected from prospective or actual patients with the vendor providing the advertising or marketing services is engaged in fee splitting. The prohibition against fee splitting is also applicable to the marketing of dental treatments or procedures via “social coupons” if the business arrangement between the dentist and the concern providing the marketing services for that treatment or those procedures allows the issuing company to collect the fee from the prospective patient, retain a defined percentage or portion of the revenue collected as payment for the coupon marketing service provided to the dentist and remit to the dentist the remainder of the amount collected.
Dentists should also be aware that the laws or regulations in their jurisdictions may contain provisions that impact the division of revenue collected from prospective patients between a dentist and a third party to pay for advertising or marketing services.
This prohibition expands upon an existing prohibition in the Ethics Code that “Dentists shall not accept or tender “rebates” or “split fees.”” (4.E. “Rebates and Split Fees”).
While recently companies such as Groupon and LivingSocial have begun offering contracts to healthcare providers that takes into consideration the prohibition against fee splitting, doctors and dentists should nonetheless remain vigilant. Social coupons may involve other ethical and legal considerations and a review by a trusted adviser is a good prescription.
If you have questions regarding social media advertising for doctors or dentists or require other legal assistance, please contact us.