Properly utilizing chiropractic discount programs, Part II

One of the best ways to offer chiropractic discount programs for current patients is to use a DMPO when a patient’s insurance benefits become exhausted

If you’ve thought about chiropractic discount programs, you need to be sure that you’re doing it in a way that keeps you compliant. If you agree to accept discounted services, you have to live up to your agreement — or you and your practice could be at risk.

Jeff Langmaid, DC, Co-Founder of The Smart Chiropractor and The Smart Chiropractor podcast as well as author of the book Marketing Chiropractic to Medical Doctors took time to answer our questions about discounting services and staying compliant.

What follows is Part II of the interview, which has been edited for length and clarity (read Part I here).

When should DCs not discount their services? What could get them into trouble?

Chiropractors should not discount their services anytime it may cause compliance issues. Most chiropractors are caregivers at heart — we love serving people and will do everything in our power to help people in our communities live healthier lives. However, with regard to discounts and payments, you need to be careful.

For example, ignoring a copay or not billing a person with Medicare, their patient responsibility is not only not compliant, but it’s illegal. Every time you choose to work with an insurance company, government, or private insurance, you are signing a legally-binding contract. You don’t get to select which parts of the agreement you intend to uphold in your practice later. If you are having difficulty understanding a contract, bring it to an attorney before signing. Paying an attorney to review and explain a payor contract to you now will be much cheaper than enduring an audit or lawsuit down the road.

If a patient has active insurance that you are contracted with, it’s unlikely that you will be able to provide any additional discounts. Of course, there are exceptions to this general rule but remember that the payor contracts you sign are very detailed and at times can be quite restrictive in your ability to provide alternative fees compliantly.

From a practical level, I would also say chiropractors should not deeply discount their services to build their practice. Deep discounts tend to attract people who are only shopping for deep discounts. Trying to “convert” these patients to care often ends up costing you more time and money (does anyone remember the Groupon days?).

Deep discounting can often create a lot of leads in a short amount of time. But rarely do these leads translate to happy, long-term patients who refer. Don’t be fooled into thinking deep discounts that generate leads are the best way to build a practice, even if a Facebook marketer tells you otherwise.

When using proper chiropractic discount programs, should chiropractors advertise that they do this?

Advertising your discounts and special offers can be a great way to build and grow your practice, as long as you stay compliant and avoid deep discount advertising. Every local, state, and federal health care organization maintains rules and regulations regarding proper advertising. For example, since offering cash discounts to Medicare patients is problematic under federal anti-kickback laws, you’ll want to include an appropriate disclaimer in any/all of your advertisements.

When a patient pays your fee at the time of service, it is reasonable to offer a discount that reflects the cost of billing. The OIG issued an opinion for a hospital that indicated 5-15% would be considered a reasonable time of service discount. If your time-of-service discount is over 20%, you may be overreaching with your discount and approaching what could be considered a dual fee schedule.

It is generally acceptable to offer a financial hardship discount for struggling patients who need some added flexibility in their payment options. The key to compliance for financial hardship is to document exactly what you consider a hardship in your standard operating procedure.

Additionally, it’s wise to have an additional form for financial hardship patients sign that attests to their hardship. Finally, you’ll want to be mindful of your discount. Reducing a $100 fee to $1 for financial hardship seems a lot more like a dual fee schedule than an actual financial hardship case.

DMPOs (discount medical plans) are also a smart way to offer compliant discounts for patients with limited or no insurance. Again, be sure to use the appropriate disclaimers when advertising these payment options.

Can discounting services for current patients (if allowed) help chiropractors grow their businesses?

One of the best ways to offer chiropractic discount programs for current patients is to use a DMPO when a patient’s insurance benefits become exhausted. For patients with limited insurance that exhausts before your care is complete, a DMPO can provide a compliant way to discount their remaining care.

This can help grow your practice because a DMPO (discount medical plan) offers a membership-based, compliant way to discount services without a dual fee schedule. DMPOs can help you improve your patient retention as more patients will complete their care plans without being limited only to the care included in their insurance plans.

Of the biggest mistakes chiropractors make is having a dual fee schedule. In many states, it is illegal for a doctor to set up an internal “dual fee” schedule where they charge a lower fee than their insurance rate. A dual fee schedule is when you charge more to an insurance company or third-party payor than you do to a cash patient. Often, you can compliantly provide a time of service, or financial hardship, discount, but these discounts are typically recommended to be 10-15%. Billing and insurance company $100 for spinal manipulation and charging cash patients $50 would very likely be considered a dual fee schedule. There are specific rules and regulations in many states relating to how you can compliantly construct a single fee schedule.

In short, keep it simple. You need to have one fee schedule regardless of who is paying the bill.

The above is meant as general advice. Always consult a health care attorney about your particular situation.