Groupon for Hospitals? Watch Out!

Groupon mania has swept the country!

My wife and I have enjoyed many new restaurant experiences at a great price thanks to this wildly successful online discount coupon service. I watched a small day spa sell 1,120 half-price coupons in 24 hours and wondered how they would ever schedule all those new customers.

But is Groupon for your hospital?

Before you jump at the opportunity to offer Groupons for mammograms or sleep studies, health care attorney David Harlow provides some serious cautions on Mayo Clinic’s Center for Social Media blog.

“Since health care services are heavily regulated at the state and federal level,” writes Harlow, “and since health care insurance companies add another layer of restrictions in their contractual language with health care providers, there are legal issues that have to be examined before deciding to go with Groupon, LivingSocial or other similar services.”

Depending on your state’s laws, says Harlow, here are some legal minefields you need to steer clear of:

  • Groupon collects 50% of the price of the groupon as its fee; is that illegal fee-splitting under applicable state law?
  • Is the 50% fee an illegal kickback in exchange for a referral?  Are you subject to federal laws in this area in addition to any state laws?
  • Do provider agreements with third party payors prohibit the offering of discounts to plan subscribers?  (If you can get over the first two issues, you may need to screen out folks who are insured by carriers who limit your ability to discount or risk being in default under an agreement with your biggest customer.)

The takeaway: Have a serious talk with legal before moving forward with any social media coupon services.


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