Home Health & Hospice Week

Hint: Start by scrutinizing your compensation arrangements.

Not sure how to structure your outside marketers' compensation safely? You'd better learn fast or risk big-time penalties.

Home care providers should remember that marketing in the health care arena carries extra risk, advises attorney Bob Ramsey with Buchanan Ingersoll in Pittsburgh. The language of the Anti-Kickback Statute's second section is "pretty broad," so any sort of compensation based on a percentage of business generated or some similar volume- or value-based methodology is particularly risky, Ramsey notes.

Follow this expert advice to bullet-proof your marketing compensation arrangements: 1) Take a close look at your compensation arrangements for non-employee marketers to make sure they are in line with Anti-Kickback rules, Ramsey suggests.

"The basic rule still is that payment of commissions to non-employees based on number of referrals violates the Anti-Kickback law," counsels attorney John Gilliland II with Gilliland & Caudill in Indianapolis.

Loophole: However, you are free to pay directly employed marketers in whatever way you see fit, Gilliland adds. Just remember to make sure your compensation arrangement abides by state law as well. 2) Use the guidelines from the Anti-Kickback Statute's personal services safe harbor to make sure your payment methodology is above board, recommends attorney Mark Langdon with Arent Fox in Washington, DC. Those rules include setting payment in advance and not basing payment on volume or value of referrals. 3) Avoid commission-based compensation. "The best advice to providers is to avoid paying independent contractors who provide marketing services on a commission basis or per patient," offers Burtonsville, MD-based attorney Elizabeth Hogue. 4) Seek legal review. Paying outside marketers is so risky that Gilliland advises having any marketing compensation arrangement with non-employees reviewed carefully by legal counsel.

Editor's Note: For a copy of the Anti-Kickback Statute safe harbor provision for personal services, email executive editor Rebecca Johnson at rebeccaj@eliresearch.com with "Safe Harbor Provision" in the subject line.