ENTtoday
  • Home
  • COVID-19
  • Practice Focus
    • Allergy
    • Facial Plastic/Reconstructive
    • Head and Neck
    • Laryngology
    • Otology/Neurotology
    • Pediatric
    • Rhinology
    • Sleep Medicine
  • Departments
    • Issue Archive
    • TRIO Best Practices
      • Allergy
      • Facial Plastic/Reconstructive
      • Head and Neck
      • Laryngology
      • Otology/Neurotology
      • Pediatric
      • Rhinology
      • Sleep Medicine
    • Career Development
    • Case of the Month
    • Everyday Ethics
    • Health Policy
    • Legal Matters
    • Letter From the Editor
    • Medical Education
    • Online Exclusives
    • Practice Management
    • Resident Focus
    • Rx: Wellness
    • Special Reports
    • Tech Talk
    • Viewpoint
    • What’s Your O.R. Playlist?
  • Literature Reviews
    • Allergy
    • Facial Plastic/Reconstructive
    • Head and Neck
    • Laryngology
    • Otology/Neurotology
    • Pediatric
    • Rhinology
    • Sleep Medicine
  • Events
    • Featured Events
    • TRIO Meetings
  • Contact Us
    • About Us
    • Editorial Board
    • Triological Society
    • Advertising Staff
    • Subscribe
  • Advertise
    • Place an Ad
    • Classifieds
    • Rate Card
  • Search

How to Work with Sales and Marketing Representatives in Your Medical Practice

by Steven M. Harris, Esq. • December 9, 2019

  • Tweet
  • Email
Print-Friendly Version

Sales and marketing representatives can add tremendous value to your practice. They can generate consistent business by leveraging contacts who have services that can be referred to your practice. However, the services a sales and marketing representative provides are subject to significant scrutiny under the federal Anti-Kickback Statute (AKS) and state equivalents. For this reason, the decision to engage sales and marketing representatives is one you should make carefully, with the advice of counsel experienced with these types of arrangements.

You Might Also Like

  • 9 Tips For Surviving the First Year of Medical Residency
Explore This Issue
December 2019

Concerns

AKS prohibits offering, paying, soliciting or receiving anything of value to induce or reward referrals or generate federal healthcare program business. Many states have their own version of AKS that similarly prohibit any payment in exchange for referrals of healthcare services. Sales and marketing representatives are engaged to secure referrals of healthcare services to the physician practice with which they are contracted. This type of arrangement implicates AKS, and to engage sales and marketing representatives in a compliant manner, the arrangement you make with them should be structured to comply with one of the AKS safe harbors. The applicable safe harbor for these types of arrangements is the one for personal services and management contracts. To receive protection under this safe harbor, the arrangement must satisfy the following elements:

  • A written agreement must be signed by the parties;
  • The term of the agreement must be at least one year;
  • The agreement must specify aggregate payment, and such payment must be set in advance;
  • The compensation must be fair market value and determined through arm’s length negotiations; it must not be determined in a manner that takes into account volume or value of referrals;
  • The agreement must set forth the exact services required; and
  • The arrangement must serve a commercially reasonable business purpose, not taking into consideration the referrals generated as a result of the arrangement.

If an arrangement does not meet these requirements, it falls outside the safe harbor and is subject to scrutiny by the Office of Inspector General (OIG) and could subject the parties to fines and penalties if the arrangement is determined to run afoul of AKS.

EKRA

The Eliminating Kickbacks in Recovery Act (EKRA), passed October 2018, also changes how sales and marketing representatives are compensated. EKRA was passed as part of the SUPPORT Act, which was drafted to address the opioid epidemic in the U.S. However, EKRA was drafted broadly, and it has a direct impact on sales and marketing arrangements for certain healthcare entities. Specifically, EKRA applies to recovery homes, clinical treatment facilities and laboratories (regardless of whether the laboratory engages in drug testing). It applies to all payers, whereas AKS is concerned only with arrangements that result in additional claims being submitted to a federal healthcare program, such as Medicare or Medicaid.

Under EKRA, you cannot pay a W-2 employee or independent contractor in a manner determined by or that varies by:

Pages: 1 2 | Single Page

Filed Under: Departments, Legal Matters Tagged With: legal, marketingIssue: December 2019

You Might Also Like:

  • 9 Tips For Surviving the First Year of Medical Residency

The Triological SocietyENTtoday is a publication of The Triological Society.

The Laryngoscope
Ensure you have all the latest research at your fingertips; Subscribe to The Laryngoscope today!

Laryngoscope Investigative Otolaryngology
Open access journal in otolaryngology – head and neck surgery is currently accepting submissions.

Classifieds

View the classified ads »

TRIO Best Practices

View the TRIO Best Practices »

Top Articles for Residents

  • Do Training Programs Give Otolaryngology Residents the Necessary Tools to Do Productive Research?
  • Why More MDs, Medical Residents Are Choosing to Pursue Additional Academic Degrees
  • What Physicians Need to Know about Investing Before Hiring a Financial Advisor
  • Tips to Help You Regain Your Sense of Self
  • Should USMLE Step 1 Change from Numeric Score to Pass/Fail?
  • Popular this Week
  • Most Popular
  • Most Recent
    • The Dramatic Rise in Tongue Tie and Lip Tie Treatment
    • Complications for When Physicians Change a Maiden Name
    • Vertigo in the Elderly: What Does It Mean?
    • Is Middle Ear Pressure Affected by Continuous Positive Airway Pressure Use?
    • Rating Laryngopharyngeal Reflux Severity: How Do Two Common Instruments Compare?
    • The Dramatic Rise in Tongue Tie and Lip Tie Treatment
    • Rating Laryngopharyngeal Reflux Severity: How Do Two Common Instruments Compare?
    • What Happens to Medical Students Who Don’t Match?
    • Vertigo in the Elderly: What Does It Mean?
    • Complications for When Physicians Change a Maiden Name
    • Novel Bioabsorbable Plate Associated with Lower Leak Risk in Patients Receiving Endoscopic Skull Base Repair
    • New Findings Support Use of Cemiplimab as Neoadjuvant Therapy in Patients with Resectable Cutaneous Squamous Cell Carcinoma
    • Kinetic Oscillation Stimulation an Effective, Lasting Second-Line Treatment for Patients with Nonallergic Rhinitis
    • Otolaryngologists Vary Significantly in Choice of Injectable Materials for Vocal Fold Injection Augmentation
    • COVID-19 Infection May Be Associated with Unique Manifestation of Facial Nerve Paralysis/Palsy

Polls

Do you believe that having more otolaryngologists appear on mainstream media outlets is a good thing for the field?

View Results

Loading ... Loading ...
  • Polls Archive
  • Home
  • Contact Us
  • Advertise
  • Privacy Policy
  • Terms of Use
  • Cookie Preferences

Visit: The Triological Society • The Laryngoscope • Laryngoscope Investigative Otolaryngology

Wiley
© 2023 The Triological Society. All Rights Reserved.
ISSN 1559-4939