Fee Splitting vs. Advertisement (Living Social, Groupon, Gilt)

[DrDentistDMD]

As business owners, we are always looking for new avenues for advertising our dental practices. My web manager has decided that Living Social, Groupon, and these types of sties would be a great way to get new patients in the door.

However, I have a concern that these may be viewed as "fee splitting," and of course I do not want to do anything illegal.

LivingSocial.com has offered to advertise for my office, a deal for Zoom Bleaching at a discounted price. In exchange for the free advertising, LivingSocial.com takes 50% of the revenue of any deal that we sell. I've seen other dental offices on there, selling as much as 300 deals! (meaning, 300 new patients have purchased discounted coupons for new patient exam, consult, and Zoom which they can redeem within 1 year).

Can this be seem as "fee splitting?"

Wikipedia: "Fee splitting is the practice of sharing fees with professional colleagues, such as physicians or lawyers, in return for being sent referrals" "In most parts of the world, the practice is considered unethical and unacceptable, hence fee splitting is often covert. The reason it is believed not to be in the interests of patients is because it represents a conflict of interest which may adversely affect patient care and well-being, since patients will not necessarily be referred to the most appropriate doctor to provide their on-going care but will instead be referred to those doctors or hospitals with whom the referring doctor has a "fee splitting" or commission payment type of arrangement."

It definitely doesn't seem like fee splitting to me, but it seems like it could get into some sort of grey area. The internet is the new frontier for dental offices, so I don't even know if a precedent has been established yet for these types of sites?

Any ideas? Opinions? Experiences?
Thanks!

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[DrTacoElf]

I'm interested to know this as well.

 

[touchadream]

If you are allowed to advertise, this is just advertising. Fee splitting is between professionals. Having said that, I would suggest you negotiate with the advertiser a fixed fee per coupon redeemed. Clicks aren't patients. If you run into other professional problems with a particular patient, you do NOT want to be in the position of arguing about charges with an advertiser. I am a tax attorney married to a doctor, so, although this response can in NO WAY be considered legal advice, consider this scenario (we lawyers split hairs and fees!): Patient brings in coupon for whitening--you spot a problem, a medical, not a cosmetic problem and begin treatment. Do you owe the advertiser 50% or whatever % of your professional fee then? This is why you need to read the fine print, or have someone read it for you before you sign, since this is, after all, a contract. If its not written down, its not in there, so don't let your web guy's enthusiasm and the sales guy's enthusiasm carry your good sense away. You are a doctor, and need to behave like one. I think this is the important issue here.

Next, while I think the internet is magic and use it myself all the time, think about how people choose a dentist. I know there is a "vanity" play in the business now, and if that is a profit center, without a downside of risk to you, and can be a profit center like hygenists can be, then by all means, you may go there, without fear of "fee splitting", but groupon isn't the same for frozen yogurt as it is for dentistry. I think you need to know how people choose dentists, and why people leave dentists.
My guess is 1. referrals and 2. bad experiences. No reason referrals can't be on the internet, but I haven't seen any for my dentist on there and he is brilliant, a perfectionist and gentle enough to have eliminated my lifelong fear and dread of the pain I endured for so many years. Since dentists are so local, when I moved, I asked for a referral from an orthodontist, but don't think that is normal. I think most people just ask friends, and if they are new in town ask co-workers, or use an insurer's list. If you decide to go with the web guy's suggestions, good cash management says limit the time/cash outlay, track results, pay for patients, not clicks, and track the patients to see if they are just shopping for whitening and will go to the next guy with the next coupon. If that makes you money, so be it, but if you are looking to build a practice, this discounting approach may not be your cup of tea. Do you know this or are you guessing? If guessing, then put the financial burden of it working or not on the advertiser, not on you! Is your web guy advising you on SEO--does he have you on the first search page in your town on google? If not, that is where you need to start, isn't it? Best of luck. Merry Christmas.

 

[flagship]

The logic used by the poster above it false. This person has no idea what she/he is talking about.

Groupon requires that you pay them a percentage of the fees collected for a professional medical service, and therefore it is fee splitting. In fact, I have called regulators in my state and have confirmed this.

I find it disturbing the sort of logic that is being used to justify the practice of fee splitting using groupon et al. Creating distinctions to justify your decision to do this - ie well it is cash or it is a cosmetic service - will not help you out if regulators are notified. This is a very black and white question: Are you splitting your fees for a medical service you are offering? If the answer is yes, whether it is for cash or cosmetic procedures does not matter. Whether you are doing it to advertise does not matter.

Groupon NEEDS to stop approaching medical professionals and asking them to engage in this illegal and unethical practice. I feel like Groupon, who has been notified of how this practice is problematic, should be held accountable. Too many good doctors and medical professionals have unknowningly put themselves at risk due to Groupon.

 

[GTFOOMICT]

The groupon concept is strikingly different than the fee-splitting that was presented to us in dental school. This would be an excellent addition to our ethics curriculum.

I would personally not have any issues with a colleague using groupon. The patients have a choice, their decisions are not being directed by a 'referral source' they trust. It's groupon. I believe the groupon customers know what's up. And they can get a 100% refund should they not want to go through with it. You do not pay a 'groupon tax' on every treatment that comes after the groupon deal.

I only bring this up because I am an example of someone who does see a difference between the kick backs of traditional inter-professional fee splitting, and the groupon model. I am not a practicing dentist, but a resident though.

On a business sense:
The type of patient who comes in your office via groupon may or may NOT be the patient pool that will grow your practice anyway. I have a family member who has a dentist already, bought herself a groupon whitening, exam, xrays for ~$100 and took advantage of the offer and went back to her old dentist. She couldn't afford whitening from the Doc she really likes but wanted the pearlies.

Groupon is BRILLIANT business model. Markets and profits created from nothing. Good job to them.

 

[Romas]

Any dentists who've employed Groupon/Living Social for these deals have any feedback on how successful they were at creating revenue? Was it worth it, or did you find that you had a lot of patients who'd just show up for the Zoom and then head on their way? I'm curious as I, too, have seen these deals, and know that other, non-dental businesses seem non-enthusiastic about clients presenting these certificates, for whatever reason... maybe groupon takes a huge cut from their profits/it recruits flaky clients?

 

[GTFOOMICT]

Any dentists who've employed Groupon/Living Social for these deals have any feedback on how successful they were at creating revenue? Was it worth it, or did you find that you had a lot of patients who'd just show up for the Zoom and then head on their way? I'm curious as I, too, have seen these deals, and know that other, non-dental businesses seem non-enthusiastic about clients presenting these certificates, for whatever reason... maybe groupon takes a huge cut from their profits/it recruits flaky clients?

You want an audience that probably embraced groupon in army fashion? Dentaltown.com may be a better audience for your question.

 

[herkulis]

Is this the future of dentistry?

http://livingsocial.com/deals/49975-dental-exam-cleaning-and-x-rays?offer_id=4&aff_id=643

• 85%
  savings
• 73
  purchased

http://www.groupon.com/deals/heartland-dental-care-1

195 bought

 

[Archform32]

Groupon, etc, are definitely NOT fee splitting. You do not receive money and then give a portion to Groupon without the patient knowing about it.

Quote whomever you like, but the ADA's position seems to be that fee splitting is when a "secret" relationship is formed between two parties to share revenue without the patient's knowledge.

See:
http://jada.ada.org/content/138/7/936.1.full

In this case, Groupon offers a coupon for a discount off the procedure in question and makes it clear that they get something out of it. In turn, they take their portion for advertising (no different than paying a coupon company to produce them for you) and in turn, they pay you the remaining portion.

If Groupon were fee splitting, we would need to arrest everyone who ever did a community coupon mailer, internal reward programs, etc. Yes, imagine giving someone a gift card or credit for referring a patient. Isn't that fee splitting as well? How about paying a marketing consultant or a guy standing in a sandwich board outside your office (not recommended) for every new patient they bring you? Better yet, how about having your staff hand out referral cards with their names on them and giving them a reward for every new patient who comes in with one of their cards?

Better yet, I think that we should imprison any dentist who offers to donate all fees to charity from a certain number of patients in a given time period. How dare they consider paying someone else on a per person basis. If, say, a breast cancer charity advertises that all the proceeds from a dentist will be donated to them for a certain time period, is that fee splitting as well?

DrDentistDMD, by far the biggest problem we have in dentistry is the jealous and hostile environment we make for one another. As far as I know, nobody has ever been prosecuted for using social media or Groupon. Let's all take a deep breath and simply relax.

Does Groupon create an unfair advantage in any way? Is the patient steered in a direction they should not have been for money's sake? Is their care altered because of an undisclosed monetary relationship? I think that common sense should prevail.

Of course, there is a big difference between whether you CAN use Groupon and if you SHOULD use Groupon. That's an altogether different discussion.