Professional Courtesy: Guidelines for Physicians

What is allowed in terms of professional courtesy for physicians, including waiving fees for financial hardship or providing discounted care for physician colleagues and their families?

What is allowed in terms of professional courtesy for physicians, including waiving fees for financial hardship or providing discounted care for physician colleagues and their families? Neil Baum, MD, shared insights in a recent Five Minute Practice Fix, a series of instructional videos.

Just a few decades ago, “professional courtesy” was a nice perk to offer colleagues’ family. It was not uncommon for physicians to waive the copay, deductible, or even all charges for select individuals as a professional courtesy. The question is: Is this practice still allowable?

There are some relevant laws. In 1972, Congress passed an anti-kickback law that prohibited individuals from offering or accepting remuneration in exchange for referrals; the law was meant to protect Medicare and Medicaid in addition to patients.

In 1989, Congress passed the Stark anti-kickback law, which prohibits physicians from referring patients or their family members to any person or group in which the doctor has a financial interest. For example, if the physician is part owner of the pharmacy or an imaging center, they are not allowed to refer patients to that pharmacy or to that center because of their financial interest. In 1991, we saw the waiver of copayments, not allowing professional courtesy if there is any potential to attract such referrals.

At the present time, the US Department of Health and Human Services Office of the Inspector General (OIG) prohibits the waiver of copayment or deductible, ie, insurance only for Medicare and Medicaid recipients. The False Claims Act notes that a fraudulent submission of a payment to CMS has penalties of $5000 to $10,000 per claim. Often these claims are generated by a whistleblower in the practice, who shares in the proceeds that are recovered by a fraudulent submission.

The American Medical Association has an opinion in which it states that a doctor must use good judgment when offering professional courtesy. Really, it has kicked the can down the line and taken a pass on professional courtesy. But at present, the AMA ethical opinion is that you are not allowed to accept deductibles.

The legal considerations say it is ethical and appropriate to waive a copay or deductible if the patient has a financial hardship or if you have tried to collect the fees and they are uncollectible. OIG requests or demands consistent practice of waiving the entire fee. You have to demonstrate that the intent of offering professional courtesy was not to achieve referrals from another physician.

OIG cautions against giving professional courtesy to colleagues and their families if you receive or you refer patients to those colleagues. Best advice regarding professional courtesy is to consult a health care attorney.

Final advice is to be consistent. If you offer professional courtesy to all colleagues and their family, then you are probably going to be safe. However, offering professional courtesy only to colleagues who refer patients to you and do not offer that same courtesy to other doctors may be a violation of the Stark or anti-kickback laws.