Professional courtesy

Here’s a question:

I think I have an oddly large number of physician patients in my cohort. If they have a high deductible plan, how many of you have been writing off their bills as a professional courtesy?

And someone responded:

“In general, we have issued professional courtesy to every doctor that refers us patients.  we have many random doctors and other professional for which no courtesy is extended.”

And here’s my reply:

Not picking on anyone here. But this is 100% a violation of Stark and AKA (anti kickback) law. These laws are meant to prevent inducements for referral of Medicare or Medicaid patients.

The government takes the position if you’re providing free medical services by waiving commercial copays, which have monetary value, as an inducement for referrals if Medicare patients it’s a violation. It may also be a violation of your commercial contracts if you don’t collect patient responsibilities.

Many of you who just opened doors think by waiving copays and deductibles, it will generate goodwill and being more business.

I totally disagree. I’ve charged referring doctors their full deductible- and they still refer to me, because they get timely and friendly service and a accurate diagnosis and through explanation, not because I have them something for free.

One referring primary brought his father from Los Angeles, where there is no shortage of cataract surgeons, to Phoenix for me to do his surgery. I still charged the 20% coinsurance. His dad did great and he still refers me everything.

What I do is to try to respect their time, by making them the first or last patient of the day so they don’t have to wait. And if my waiting room is crowded they get to sit in my personal office.

Back to the subject, no good deed goes unpunished. Before you think you’ll never get caught- all it takes is a disgruntled employee or competing doc who wants a share of recovery in a qui tam whistleblower lawsuit. 

The reasoning below makes my head spin, so that’s why I don’t offer discounts/ copay waivers/ etc.  And i would strongly advise anyone else on this thread from doing as such. But if you do please read on to make sure you’re in compliance:

First of all, if you extend professional courtesy, the Stark law actually has a safe harbor. Here it is verbatim cut and paste from this article:

Under the Stark Law, there is an exception created for courtesy policies. If you follow the correct rules, you are deemed not to be in violation. 

• The courtesy must be offered to all doctors on the medical staff, or in the entities local community without regard to the volume and value of referrals or other business generated between the parties.

• The entities professional courtesy policy must be set out in writing and approved in advance by the practice’s governing body.

• The courtesy offered by the practice may apply only to health items or services of a type that it routinely provides.

• The courtesy may not be offered to any doctor or doctor’s family member if they are a Federal Health Care Program Beneficiary unless that individual has a showing of financial need.

• The professional courtesy policy must not violate the Anti-Kickback Statute. That is, it may not be offered with the intent to induce referrals, as discussed above.

Page three: 

If you’re offering professional courtesy, do you have a policy in writing on which groups of physicians you extend it to (Med staff for certain hospitals, geographic area) and enforce it?  Are you sure the group isn’t defined by referrals or the potential for referrals?

Secondly, there’s the anti kickback statute. There are two ways you can go astray. The first is similar to stark- you can’t selectively offer professional courtesy to groups that refer or might refer to you. The second way is that waiving copays is an inducement to services- but if you really want to waive copays the way to get around this is to not bill insurance at all, and get nothing from the insurance company. 


whether a professional courtesy arrangement runs afoul of the fraud and abuse laws is determined by two factors:

(i) How the recipients of the professional courtesy are selected; and

(ii) how the professional courtesy is extended.

If recipients are selected in a manner that directly or indirectly takes into account their ability to affect past or future referrals, the anti-kickback statute—which prohibits giving anything of value to generate Federal health care program business—may be implicated. If the professional courtesy is extended through a waiver of copayment obligations (i.e., ‘‘insurance only’’ billing), other statutes may be implicated, including the prohibition of inducements to beneficiaries, section 1128A(a)(5) of the Act (codified at 42 U.S.C. 1320a–7a(a)(5)). Claims submitted as a result of either practice may also implicate the civil False Claims Act.”

For the record, 90% of me thinks these laws are idiotic, intrusive and overreaching just like MIPS.  My numerous emails about how to get a high score on MIPS doesn’t imply I think it’s a good program or have any use. 

I’m just trying to clarify the rules to help everyone stay out of trouble, not make any judgements. But there is 10% of me which likes these rules because certain folks (no one on this thread) would bribe referring docs, thus hurting honest folks like me.

You can build a practice the right way- by providing good care, service and results. That’s why people refer to me, not because i gave them something for free as an incentive. 

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