OIG Approves Pay-Per-Lead Advertising Arrangement

The Department of Health and Human Services Office of Inspector General (“OIG”) issued Advisory Opinion 08-19, approving an arrangement under which an internet advertiser proposed to direct potential patients to chiropractors in exchange for payment on a per-lead basis. OIG concluded that the proposed arrangement demonstrates a lack of intent to induce referrals; as a result, OIG indicated that it would not impose administrative sanctions on the advertiser. The advertiser proposed to forward inquiries it receives from zip code-based searches for chiropractors. In return, participating chiropractors would pay the advertiser a fair market value fee for each forwarded inquiry. OIG concluded that the arrangement fails to satisfy requirements under safe harbors for personal services and management contracts and for referral services. Key factors that lead OIG to its conclusion include the following facts: the advertiser is not a health care supplier or provider, the proposed arrangement does not target Federal health care program beneficiaries, fees paid would not reflect whether the potential patient ultimately receives chiropractic services, the proposed arrangement does not direct patients to particular chiropractors and the advertiser notifies potential patients that chiropractors pay a fee to be listed in its directory. The full text of Advisory Opinion 08-19 can be found here