Gifts and Inducements
Q.: May I give gifts to patients to thank them for referring new patients to my office?
A.: No. Both state and federal law prohibits providers from compensating other persons in any amount in exchange for referring patients to the provider. Under federal law, offering gifts or cash in exchange for referrals could be construed as an illegal “kickback,” or payment to the referring individual of a portion of the medical charges. Under Illinois law, the Illinois Medical Practice Act prohibits a physician from dividing, sharing or splitting any fee for professional services with any person in exchange for a referral. If the gift or cash is construed as a division or sharing of fees, the physician’s license may be disciplined.
Giving gifts as compensation for referrals is distinguished from giving gifts to a patient where no referral is involved. For Medicare and Medicaid recipients, federal law allows providers to offer one time gifts that have a retail value of $15 or less, or no more than $75 per year in the aggregate. Therefore, you are permitted to offer gifts to Medicare and Medicaid patients if the gifts do not exceed these amounts and are not given in exchange for a referral.
Gifts such as coupons for free exams, 30-minute massages, adjustment, and x-rays would yield a fair market value greater than the allowable amount, but some services, such as spinal screenings, very well may have a fair market value of $15 or less. However, in the case of non-Medicare patients, the Illinois Medical Practice Act would govern the giving of gifts. Because the Act does not create an exception for small gifts under a certain retail value, the ICS believes that the giving of any gift to a non-Medicare patient carries a risk of violating the fee-splitting prohibition on the Medical Practice Act.
In addition, offering discounted or free examinations and x-rays could place you out of compliance with other provider network contracts you have signed. You will need to check the terms of your provider agreements to determine whether they permit you to provide these services.