Marketing, Telemarketing, Compliance & Healthcare

Written by: Nancie Lee Cummins, CFE, CHA, CIFHA, OHCC, CHCM, CHCO, CORCM   

Due to the high volume of fraud schemes involving telemarketing revealed by the Department of Justice (DOJ) over recent years, it is important that providers heed “buyer beware” when engaging with a telemarketing firm.  “If it is too good to be true it probably isn't.”  This article is educational only, and does not provide consulting or legal advice.  Using a telemarketing firm can help your organization, but it must be used within applicable rules regulating health care.

When a healthcare practice starts talking about, “What can we do to increase business?”, telemarketing always seems to come up. So, what is telemarketing in healthcare?  What compliance issues need to be considered when drafting a marketing strategy?

Let’s define “telemarketing” - which is a process in which telephone calls are used to promote business within the industry or, let’s say, in your medical practice to increase patients flow. 

Typically, the health care provider does not have internal resources for this type of project and will hire a professional telemarketing firm.  It is a strategy used to not only increase your patient based, but increase other incremental income as well.  The bottom line is that this marketing strategy has the ultimate goal of increasing revenue.  Great idea, right?  But, is the telemarketing company operating compliant to federal rules and regulations?  Let’s take a closer look at potential compliance risks.

As we discuss the pros and cons of telemarketing, we cannot start without mentioning it can be a positive, but with it can come some ethical decisions. Items to be clear on such as, making sure you read the telemarketing contract understanding what you are signing.

As a reminder, telemarketing in healthcare must follow strict privacy regulations, such as the Health Insurance Portability and Accountability Act (HIPAA), Public Law 104-191 in the United States. Is your engagement with the telemarketing firm include providing that firm with patient names and contact information?  If so, you need to consult with legal counsel regarding both patient consent and a business associate’s agreement.

Patient consent is essential before any personal health information is shared over the phone.  

The “HIPAA Privacy Rule gives individuals important controls over whether and how their protected health information is used and disclosed for marketing purposes. With limited exceptions, the Rule requires an individual’s written authorization before a use or disclosure of his or her protected health information can be made for marketing. So as not to interfere with core health care functions, the Rule distinguishes marketing communications from those communications about goods and services that are essential for quality health care.” 

It is important to first understand what “marketing” is, and what it isn’t, so please – reference 45 CFR 164.501, 164.508(a)(3) for marketing guidance provided by the Office for Civil Rights (OCR), the HIPAA enforcement agency.

Implement Compliant Marketing Strategies

Larger Group practices and Clinics

Let’s look at some online advertising. This is a process of sharing your services or brands through various sites on the internet.  It can give you a large range reaching your target market which you are able to measure for its effectiveness.  In looking at online there are different platforms you can utilize.

The most common is your own “Web site” with information reflecting your business model and services. Patients are able to go online, see biographical data on physicians, with locations, hours of operations and more information about what you offer. This is always a good place to add a couple of videos if you choose.  They are also able to find directions with a click from their own home.  Some sites even offer patient appointments.  Remember, websites can offer multiple pages with valuable published information.

Social Media seems to be everywhere giving opportunity to promote your practice through Facebook, Instagram, Twitter, and LinkedIn.  These sites allow you to focus on particular demographics, behavior, interests and many other groups.

We couldn’t talk about websites without mentioning “Blogs”.  Blogs can be used for various purposes which can be a great way for sharing information.  For example, if you’re an Internist, what better way to promote articles on diabetes.  There are many ways to promote your practice. The key to blogs is you do have to keep them updated.

Referral business is also valuable.  What better way to have a referral from a colleague which your patients will be pleased you already know them.  We will discuss referrals a little later in this article with regards to the Stark Law violations.

When trying a new approach to marketing, building a successful online strategy takes time and tracking.  Regularly evaluate the performance of your efforts and define your results whether they are effective or not.

Smaller Practices

One of the areas for small group practices is the ability for small groups or practices that are new to the community.  Communities are known for having health fairs for the locals. What better place to meet those who attend and leave their name for future information?  From here you have a list to start your calls from a “warm” lead.  During this process of whatever source, you used for your leads, you have to follow the same guidelines as stated above. 

Building relationships with other organization in your community, you may want to include, healthcare providers, community organizations, and yes, even local businesses.  Go out and attend those events, whether it is charity or a meet and greet in your town.

Relationship building comes in all forms with maintaining communications with patients giving them your trust before and after they become your patient.

Telemarketing to educate patients about various upcoming seminars, health screenings work well in the rural and small group practices.  You may be the only medical office for miles and it is seen as a great way to meet and introduce yourself. Have you thought of Telemedicine or Telehealth?

Larger group practices may be able to have staff to handle various online tools for publicizing their practice, a simple “website” can bring positive results as well for the private practitioner.

As with all marketing strategies, remember Compliance, Compliance, Compliance!  I can’t say it enough. Be sure you follow regulations and that you comply with all relevant telemarketing regulations and laws.

• Understand the specific rules and guidelines with protecting patient privacy.
• Know how the Health Insurance Portability and Accountability Act (HIPAA) effects your practice.
• Make sure your telemarketing team is trained and knowledgeable about your medical group's policies and procedures.
• Be considerate of the timing and frequency of your telemarketing calls. When are they calling?

Enticement or gifts?  Where do you fall?

There seems to be a common practice of gifting to patients for bringing in referrals.  This is used to attract new patients.  This cannot be through discounted services or free consultations inclusive of merchandise.  Medical practices can give promotional items to patients, such as pens, notepads, or magnets, as long as these items are of minimal value and are not seen as inducements to receive medical services.

Medical practices can provide patients with educational materials such as brochures, pamphlets, or books that provide information about their medical condition, treatment options, and preventive care. These materials must be educational in nature and not promotional.

This isn’t necessarily illegal but it does fall under applicable laws and regulations.   

• The gift cannot fall under as violation of the anti-kickback laws. 
• This cannot be in exchange for patient referrals.
• While there is no clear limit they are to be of a minimal value. 
• The Anti-Kickback statue, says it is illegal to offer or receive any remuneration in exchange for patient referrals. 
• The Office of Inspector General (OI) states that gifts of nominal value are generally permissible. Medical practices should refer to their legal counsel.

Choosing your telemarketing company and how to know the telemarketing company isn’t fraudulent

You’ve heard of a great telemarketing company that can follow up and send you patients, and you’ve decided to jump in. There are some basics which you should have in place to prevent any problems.

Background checks should be done on telemarketers. 

• You want to be clear there has not been any fraudulent activities.
• Ask for references, call the Better Business Bureau.
• Check them out before you sign up!

Be on the alert for what their calls consist of.

• Using high pressure tactics such as being aggressive to have the patient use their services or products.
• They are requesting personal or financial information or patient social security number, credit card, etc. 
• The telemarketers are offering services at a low price.  Any type of illegal disclosure to the patients for the cost or benefits of the services offered.

You’re finding out the patient is saying, they won’t quit calling me.  I told them no.

• If your patient says the marketing company will not give them their telephone number.
• You should be monitoring and tracking the patients that do come in for their experience with the telemarketing company.
• Telemarketers cannot claim other reasons for their call.  Some will try surveys.  Telling the patient, they are calling to check on patient experience and satisfaction.

Special Considerations Specific to Durable Medical Equipment Prosthetics Orthotics and Supplies (DMEPOS)

If there is any healthcare category of providing patients equipment and supplies, this one is considered “High Risk” per CMS. 

Those that are involved in providing medical supplies will find their own set of rules.  For companies that fall under the regulation of billing Medicare and Medicaid, which are not under a medical exemption, they will need to be Accredited by an approved Accreditation Organization. These companies will follow policies and procedures for the Accrediting organization along with all Medicare rules and regulations for DME.  Medical Exemption “Medical practices” still follow all CMS regulations.

Whether a Medical practice or DME company they sell equipment and supplies to CMS beneficiaries.  This document is to inform from a telemarketing perspective of what the supply companies need to be aware of. 

Just as in medical practices, some DME companies are looking for additional patients and reach out for Telemarketing companies to bring in their sales.  The problem becomes when they do not know what their telemarketing company is actually doing. 

Are they just looking at the numbers and see new patient orders coming in and have not researched the actual flow from when the patient is contacted and how the script arrives?

The previous list under the “How do I know the telemarketing company is fraudulent?” is only one piece when it comes to DMEPOS.

DME companies are to adhere to the Supplier Standards which National Supplier Clearinghouse the authority over making sure the 30 standards are abided by.

Let’s start with standard number 11.

(11) Agree not to make a direct solicitation (as defined in §424.57(a)) of a Medicare beneficiary unless one or more of the following applies:

Calling patients in their database has to follow the above rules.  When a company or a medical practice reaches out to new prospects the above is so many times violated.

When looking at telemarketing, where the company doesn’t realize they may be calling the patients asking them if they have pain in their back or pain in their knees. They then proceed to call their doctor or have the patient call and tell their provider that they need a brace.

My own internist told me she has been getting multiple calls from patients requesting a script to get a brace.  She’s frustrated as she said “How can I stop this?”  The good news, Medicare does have a “Hot Line” for providers to call in which I gave her.

Companies also fall under a false sense of “The telemarketer” has given them a list of good leads.  The problem here again is, where are these leads coming from?  How did they get that patient? Then the company finds out they have been getting a list of beneficiaries’ information and the box of “equipment” has been delivered to a unsuspecting beneficiary.  The aging patient doesn’t even know what has happened and the box sits.  Once in a while a family member calls in and says where it came from and Medicare is notified.

Another fraudulent process they use is, having the telemarketing company set up their own doctor, who calls the patient and actually writes the Letter of medical necessity (which appears as though it was a face to face) and writes the script.  The DME company receives the information and drop ships the equipment.

There is many on the list, between scripts from “dead doctors” to paying patients money for the use of their card.

The comments aren’t to go into detail on all the ways the fraudulent marketing is done, but to make your aware of what you are getting into.  Some cases are listed below to give you an idea of what is out there.

• Owner and Operator of Telemedicine and Telemarketing Companies Sentenced to 14 Years for $20 Million Fraud Scheme and $4 Million Tax Evasion
• New Jersey Doctor Pleads Guilty to $13 Million Conspiracy to Defraud Medicare with Telemedicine Orders of Orthotic Braces
• Doctor Pleads Guilty to Role in $54 Million Medicare Fraud Scheme

The Office of Inspector General (OIG) is a division of the U.S. Department of Health and Human Services (HHS) that is responsible for protecting the integrity of federal healthcare programs such as Medicare and Medicaid. The OIG investigates and prosecutes healthcare fraud, waste, and abuse, including telemarketing schemes that target vulnerable populations such as seniors and individuals with disabilities.

The OIG has brought numerous cases involving telemarketing fraud in the healthcare industry. These cases have involved various types of schemes, including:

• Illegal kickback schemes: Telemarketers offer kickbacks to individuals in exchange for referrals to healthcare providers or suppliers.
• Billing fraud: Telemarketers use fraudulent billing practices to charge Medicare and Medicaid for services that were not provided or were unnecessary.
• Identity theft: Telemarketers steal personal information from individuals to submit fraudulent claims to Medicare and Medicaid.

The OIG continues to investigate and prosecute individuals and organizations involved in fraudulent activities related to federal healthcare programs.

These web pages provide specific information on telemarketing fraud, common scams, reporting mechanisms, and resources to protect yourself from fraudulent activities.

• Office of Inspector General   https://www.oig.hhs.gov/
  • Fraud and Abuse Laws: https://oig.hhs.gov/compliance/physician-education/fraud-abuse-laws/
• Centers for Medicare and Medicaid https://www.cms.gov/

• Federal Trade Commission (FTC):
  • Telemarketing Scams: https://consumer.ftc.gov/scams#telemarketing
  • Telemarketing Sales Rule (TSR): https://www.ftc.gov/legal-library/browse/rules/telemarketing-sales-rule
• Department of Justice (DOJ):
  • Fraud Section: https://www.justice.gov/criminal-fraud
• Better Business Bureau (BBB): https://www.bbb.org/

Conclusion

This article is just a snapshot of what areas your practice can review to ensure your marketing approach is compliant.  Consult with a legal or consulting professional to review the marketing portion of your compliance program.  Focus on what areas you should have in your policies and procedures. Many times, your malpractice insurance company can provide free risk services, so check it out as an initial resource!

A plan that includes taking control of your marketing strategies can help minimize a high-risk environment.   

Nancie Lee Cummins, CFE, CHA, CIFHA, OHCC, CHCM, CHCO, CORCM is a member of the AIHC Volunteer Education Committee.

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