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12/11/2012

House of Delegates takes action on ‘social couponing,’ Internet referral services


The CDA House of Delegates last month took action on several resolutions related to social media marketing and fee splitting in the dental practice.

At its meeting in Newport Beach, the House voted in favor of modifying the CDA Code of Ethics to include an advisory opinion on split fees in advertising and marketing services.

Over the last four years, the CDA Judicial Council has observed that one of the common inquiries and ethics complaints filed at both the state and local levels is related to “social couponing.” As a result of this and an advisory opinion on the same topic added by the American Dental Association last April, the CDA House of Delegates approved the following opinion:

11.A.1. Split Fees in Advertising and Marketing Services: 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. The prohibition against fee splitting is not applicable to marketing via group advertising or referral services that do not base their fees on the number of referrals or amount of professional fees paid by the patient to the dentist.”

The CDA Subcommittee on Ethics in Dentistry will now undertake efforts to inform members of the council’s interpretations and provide guidance on ethical conduct in this area.

“It is important for organized dentistry to be aware of how marketing techniques are changing for dental practices in this new age of technology and provide legal and ethical tips for dentists to follow when participating in such techniques,” said CDA President Lindsey Robinson, DDS.

The House of Delegates also passed a resolution to make sure the appropriate CDA entity encourage the Dental Board of California to provide clarification of whether social couponing is in compliance with California law.

In response to concerns from members in regard to fair business practices of Internet referral services, the House of Delegates also approved resolutions stating that CDA will:

  • evaluate social media and Internet referral services in an effort to ensure the fair business practices by such entities; and
  • continue to provide guidance and educate members on the effective use of social media and Internet referral services.

 “The steps taken this year by the House ensure that CDA will continue to place member protection at the forefront of the organization’s goals,” Robinson said.

‘Daily deal’ website recommendations

CDA recommends that dentists using “daily deal” websites make sure the ads are not false or misleading in any material respect (see Section 6 of the CDA Code of Ethics). The ad should contain all of the information patients would need to properly evaluate the deal and make an informed choice about the provider and the service.

From a legal standpoint, members should watch for several red flags, including:

  • Ads must not be intended or likely to create false or unjustified expectations of favorable results.
  • Ads may not make a scientific claim that cannot be substantiated by reliable, peer-reviewed, published scientific studies.
  • Dentists may not offer gifts, discounts or anything of value as compensation or inducement for patient referrals (but it is acceptable to provide something to the actual new patient).
  • Dentists may not advertise that they will perform any procedure “painlessly.”
  • Claims of professional superiority are not lawful.
  • Price advertisements must be accurate and precise, without the use of phrases such as “as low as,” “and up,” or similar words or phrases.
  • Ads relating to fees must fully disclose all services customarily included as part of the advertised service, as well as any additional services not part of the procedure but for which the patient will be charged, together with the fees for such services.
  • An advertisement of a discount must:
    • List the dollar amount of the nondiscounted fee for the service;
    • List either the dollar amount of the discount fee or the percentage of the discount for the specific service;
    • Inform the public of the length of time, if any, the discount will be honored (i.e. expiration date);
    • List verifiable fees pursuant to Section 651 of the Code (See the two bullets above.); and
    • Identify specific groups who qualify for the discount or any other terms and conditions or restrictions for qualifying for the discount.

For more information, review the ADA Code of Ethics and the advisory opinion.