Executive leadership and marketers have to know the rules to stay compliant
To meet the challenges and complexities created by the passage of the Patient Protection and Affordable Care Act, hospitals and health systems must now devise new strategies to effectively market physicians. Since the PPACA, physician alignment activities have escalated, including employment, consolidations and affiliation relationships. The increased pressure to generate revenue and grow market share, combined with the high cost of IT solutions, add to the escalation. Given the changing physician-marketing environment, many hospital and health system leaders, marketers and physician relations professionals are re-thinking their understanding of the basic day-to-day do's and don'ts of regulatory requirements. Below are seven key challenges that hospitals and health systems face and suggestions on how to best navigate the waters.
Challenge 1: Defining "marketing." The term marketing is often an umbrella term for all types of physician promotions, whether paid or unpaid, in the context of a hospital medical staff, its affiliated physicians or market area physicians. Marketing can cover anything from the press release written for an independent physician joining an integrated network to the dollars put on the table to advertise a newly employed physician or to the office practice doors knocked on by physician liaisons. In addition, marketing may be subject to fraud and abuse laws, such as Stark and the Anti-Kickback Statute. Do not fall into the trap of using words other than marketing in the hope of avoiding government scrutiny. The terms public relations, physician relations and promotion can still trigger the need for a fraud and abuse analysis.
Challenge 2: Maintaining consistency across departments and entities. Rules differ for marketing among various physician types: employed, subsidized, independent, in co-management agreements, medical directorships, networks, physicians without hospital privileges and so on. These rules can vary from state to state as well. It is highly recommended that hospitals and health systems develop or maintain a strong set of policies and practices to guide each type of relationship. These can come in the form of system or department policies. When there are documented procedures to follow, conversations with physicians, who are making certain requests, can be more straightforward. Consistency is the key to improving physician interactions, ensuring compliant relationships and maintaining a sense of equality.
Challenge 3: Determining legal compliance of marketing activities. Many times, a physician expects his or her marketing to be the responsibility of the hospital and health system based on an employment or other type of specific contractual arrangement. However, sometimes no provisions or covenants are made within the physician's agreement with the hospital for marketing support. If you do not include specific written language in the contract regarding marketing activities, you may tie the hands of the marketer trying to help the physician and the hospital.
In addition, it is advisable to include contract language that sets out specific marketing dollars or hospital-approved activities. Without such a provision, the physician's expectations may be broader than the budget allows or permitted under the law. The best strategy is to collaborate before signing a physician contract, so all hospital stakeholders (administration, legal and marketing) have what they need to successfully onboard an employed physician or support independent physician alignment activities. For example, under Stark, you will want to consult legal counsel to determine if a financial relationship with the physician exists, if the arrangement involves a designated health service or if there is a permissible exception.
Challenge 4: Advertise physicians appropriately. Historically, physician marketing has been an area of ethical debate among healthcare trade associations, marketers and legal departments. Today, hospital/physician network competition is fierce, consumers are determined to select the right physicians and some physicians need to diversify their practice volumes. All this makes certain types of advertising helpful to both physicians and consumers. However, if you do not know how to appropriately market a certain type of physician, your effort could be less effective and, possibly, run contrary to fraud and abuse laws.
Many times we see media releases or other types of promotions that direct the consumer to visit an independent physician practice's website or call that practice to request information or make an appointment. Hospitals need to tread carefully to ensure they are not violating Stark and AKS requirements and that such direction generates the right type of call to action for the right type of physician relationship. When creating an advertising campaign, the type of physician relationship determines your ability to advertise on behalf of that physician or group and influences the development of your message. When creating a message, stay away from superlatives like "the best," "the highest quality," "world-class," and "extraordinary" unless you can prove and defend them with credible data, research or other reputable sources (preferably not paid for by the hospital and unbiased). If you decide to make similar statements, refer to the federal and state laws directly related to marketing and fraud, such as the Stark, AKS, Medicare Advantage marketing guidelines, accountable care organization marketing activities and state fraud laws.
Challenge 5: Equality vs. preferential treatment. Hospital marketers may be inclined to avoid promoting physicians who they know have low activity at their organizations. They may argue that precious dollars should be spent on driving business growth and on those who help the hospital reach its goals. In traditional and non-traditional advertising, public relations events, call centers, directories, websites and other marketing efforts, providing preferential treatment or favoring certain physicians can be a violation of fraud and abuse laws. It is important that your policies and procedures outline how certain categories of physicians, whether active, courtesy, honorary or within an affiliated network, will be marketed and how those policies can be defended. For example, if your hospital's website includes a list of physicians on the medical staff, you will want to include, at a minimum, all active physicians. In addition, every hospital should have an "opt out" procedure for physicians who do not want be involved in marketing activities.
Challenge 6: Tracking non-monetary compensation to physicians. Under Stark, hospitals may provide non-monetary compensation to physicians up to an aggregate amount of $385 per calendar year for the year 2014. With so many departments reaching out to physicians in different ways, it is challenging for hospitals to keep track of their conversations with physicians. It is imperative (and, in fact, required) that hospitals track non-monetary compensation across the system to ensure compliance and review it regularly so as not to exceed regulatory limits. The annual limit applies to each physician, but cannot be aggregated to make a larger gift to a group practice or other group of physicians. For example, a $500 basket of edible goodies cannot be given to a three-physician practice and divided by three. Under Stark, this gift is indivisible and represents a $500 gift to each of the three physicians. There are three exceptions to the federal Stark non-monetary compensation requirements:
- The benefit cannot be determined in any manner that takes into account the volume or value of referrals or other business generated by the referring physician;
- The benefit may not be solicited by the physician or anyone affiliated with the physician's practice; and
- The benefit may not violate the AKS or any federal or state law or regulation that governs billing or claims.
Gift cards or "cash equivalents" are considered "non-monetary." It is not just cash that counts. For example, hospitals may need to track Doctors' Day gifts, free car washes, dinners and tickets to events. Other rules exist for food in medical staff lounges and other incidental expenses up to $32 for calendar year 2014, but they must be offered to all medical staff members.
Challenge 7: Assessing risks and opportunity of physicians and social media. The channels for communicating with physicians are changing rapidly and there is no denying that social media is a force to be reckoned with when it comes to managing reputation and potentially building business. While many hospitals and physicians still fear or ignore the use of social media as a channel for communication, many have embraced ways to manage the risks and rewards. For hospitals and physicians considering entering the social media space, defining a strong policy and providing training is key to laying a good foundation. HIPAA training is not enough. The hospital and physicians also need to invest in resources that continuously and rigorously monitor social media activity and be committed to creating rich and appropriate content applicable to these channels. The greatest challenge for physicians is to separate themselves personally and professionally and understand that if they put it in writing, by tweet or otherwise, it may be discoverable during a lawsuit or by the government.
Ruth M. Padilla is a senior consultant for Barlow/McCarthy and a 26-year veteran in hospital and physician strategy, marketing and communications.
Sarah E. Swank is a principal with Ober|Kaler's Health Law Group in Washington, D.C., and the cofounder of the Ober|Kaler Health Care General Counsel Institute. She provides advice on the implementation of the ACA to hospitals and health systems developing ACOs, clinical integrated networks and physician affiliation arrangements and acquisitions.