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FTC Announces New Guides on Endorsements and Testimonials in Advertising Print E-mail
Written by Jeffrey Segal, MD JD & Michael J. Sacopulos JD   
Monday, 12 July 2010 10:20

The Federal Trade Commission (FTC) on October 5, 2009 released "Guides Concerning the Use of Endorsements and Testimonials in Advertising."  This is the first update the FTC has made on this topic in approximately thirty years.  Much of the new Guides address social media.  With an increased number of healthcare practices and hospitals embracing an Internet presence, the FTC Guides Concerning the Use of Endorsement and Testimonials in Advertising may have broader ramifications in the healthcare industry than might be suspected. 

Medical Justice's General Counsel, Michael Sacopulos, sat down with FTC Assistant Director of Bureau of Consumer Protection, Rich Cleland, to discuss the impact of the new Guides on the medical community.  Below follows a portion of the conversation between Michael Sacopulos (Medical Justice-MJ) and Rich Cleland (Federal Trade Commission-FTC).

MJ:                   The FTC recently published final Guides governing the use of endorsements and testimonials in advertisements.  How, if at all, do you foresee these changes will impact medical providers?

FTC:                             

Medical providers in terms of their promotions are subject to the FTC Act.  Therefore, all of the Guidelines could theoretically apply to promotions advanced by medical providers.

MJ:                   The Guides used to allow for a disclaimer of "results not typical."  The revised Guides no longer contain this safe harbor.  How should health care providers that perform aesthetic procedures, and advertise via testimonials and photographic results adjust to the revised Guides? 

FTC:                 One of the things that are going to be different has to do with the impression left from the ad regarding the typical experience or results.  Not only is it advisable to indicate that results may vary, I would go beyond that and try to identify factors that may account for the variability of results.  Ultimately, it all depends on the wording and layout of the advertisement.   

MJ:                   Just to be clear, does the Commission consider a photograph an endorsement? 

FTC:                 Depending on its use, a photograph could be well be considered an endorsement, even if it is not accompanied by text. 

MJ:                   There are a variety of Internet physicians "rating" sites.  Some provide critiques of cross-industry such as Angie's List and Yelp.com, where as others are specific to the medical field such as DrScore.com and RateMDs.com.  Because of the anonymity of those who post on these sites, there is a general fear that the sites are being manipulated either positively or negatively.  Is this generally a concern for the FTC?  If so, can you generally describe the FTC's approach to this situation? 

FTC:                 There are two issues here.  If a physician goes onto a rating site and posts a glowing review of his or her services and does not disclose his or her identity that would be a violation of the FTC Act.

Secondly, negative comments about an individual would not be considered an "endorsement."  However, should the negative comments be posted by an ex-spouse or former employee posing a patient, this would be considered deceptive.  Deceptive comments in this forum would also be considered a violation of the FTC Act even though this is not specifically addressed in the recent Guides.

MJ:                   Does the FTC have legal authority to determine the identity of anonymous bloggers? 

FTC:                 If the anonymous blogger in question is relevant to an ongoing investigation of the FTC, the FTC has the legal authority to determine the identity of the blogger.

MJ:                   The revised Guides provide additional information on what the Commission considers a "material connection."  More specifically, a "material connection" is a relationship between an advertiser and endorser which a third party consumer would not expect.  If a physician reduces his or her standard fee for a procedure for a specific patient, would that fee reduction be considered a "material connection" between the physician that patient? 

FTC:                 The answer is yes.  However, it may be helpful for me to give you a factual situation where I don't think a disclosure would be required. Let's say I went into a doctor's office and I don't have insurance, the physician goes ahead and treats me and decides that since I don't have insurance, the physician will cut the [fee in] half.  I'm so elated that I go on Craig's List and post a comment on how wonderful the doctor is.  This is not the kind of endorsement that would be covered under the Guides. If, on the other hand, the physician tells me that he will take $500.00 off of the charges if I will appear in an advertisement for his practice, this is clearly an endorsement that would be covered under the Guides.   I am getting something in exchange for the price reduction.

MJ:                   Are there any other areas of concern for the FTC when dealing with individual medical practitioners?  If so, please share those.

FTC:                 I don't think that there are any specific areas of concern for the FTC at the moment.  However, the issue of 'before and after' pictures on cosmetic surgery may become of interest.  The idea of manipulating things or doing something at the core would be prohibited by Section 5 of the Guides.  For example, digital alteration of before and after photographs would be a violation of the FTC Act.

Given the recent revisions in endorsements and testimonials concerning advertisements, medical providers would be well advised to review their websites and all advertising to verify compliance.  Any endorsements by individuals who have received compensation now require a disclosure.  Further, before and after photographs should be accompanied with a disclaimer noting that results vary from patient to patient and should list several factors accounting for variability of results. Finally, if a medical provider believes that he / she is a victim of malicious and false online postings, the FTC may provide assistance.  Should you have additional questions and concerns about the new FTC Guides, you should contact legal counsel.

About the Authors

Jeffrey Segal is a board-certified neurosurgeon who was educated at the University of Texas and the Baylor College of Medicine, earning  Phi Beta Kappa and AOA Medical Honor Society recognition. Dr. Segal is the founder and CEO of Medical Justice.

Michael J. Sacopulos is a partner with Sacopulos, Johnson & Sacopulos of Terre Haute, Indiana.His area of practice concentrates upon healthcare litigation including medical malpractice defense and third party payor issues.   He is General Counsel of Medical Justice Services, Inc.

 

Click here for information on Medical Justice. 

Contact via email info@medicaljustice.com or call 877.MED.JUST (877.633.5878). 

Last Updated on Monday, 12 July 2010 10:46
 
Med Mal Q & A Print E-mail
Written by Matt Gracey   
Monday, 05 July 2010 16:43

by Matt Gracey  

Question:

When choosing a malpractice insurance company, how can I tell which one is going to vigorously defend me?

Answer:

Defending claims is really where "the rubber meets the road" in malpractice insurance!  Doctors and their administrators often get hung up in looking just at premium quotes, marketing slogans, brokers' service or personalities, or insurance-policy provisions that they might or might not like.  The real reason one purchases malpractice insurance is to be assured of a strong and affordable defense if a lawsuit is threatened or filed against your practice.  Unfortunately, figuring out each insurer's true claims-defense track record has been tricky at best.  The good news is that in recent years, the Florida Office of Insurance Regulation (OIR) has been gathering more and more data on claims defense and now has enough data to make for a credible examination and analysis. 

In looking at claims-defense records, the most useful measurement index is the one gathered on the percentage of cases each insurer has closed without any indemnity payment to the plaintiffs.  A higher percentage indicates a stronger claims-defense philosophy. The industry average in 2008 was just under 50% of filed cases closed without any payment to the plaintiff.  One popular insurer's numbers have fallen rather dramatically, from 90% of their cases closed with no indemnity payment to only 37% of them in the three-year span from 2006 through 2008, despite their marketing folks talking about their strong defense. This example demonstrates why doctors and their administrators need to "look behind the curtain" at the independent OIR data to analyze what kind of claims-defense they are really buying. 

A few notes are important, though.  Some insurers' marketing will show the percentage of their cases closed with no indemnity payment.  However, some of that marketing will skew that percentage by including closed "incident reports" as well as actual cases filed, to make their defense data look better.  Also, some newer or less-popular insurers have so few closed claims that their percentage closed is almost meaningless.  The top insurer in Florida, FPIC, handles so many cases against their large number of Florida insureds that trying to compare their above-average percentage with another insurer handling a fraction of their numbers can be a bit distorting.  Experience does count in Florida courtrooms though, and you can see from the OIR reports how many more cases an insurer like FPIC handles than their counterparts. The OIR data also show the average defense costs spent by each insurer, which is another indication of an insurer's defense philosophy.         

If you would like a copy of the most recent OIR report or to discuss your particular insurer's record, do not hesitate to contact us.  We are independent malpractice insurance experts and will help you through this maze and look out for you.  

Contact the author

 
By the Numbers: Active Licensees Print E-mail
Written by Jeffrey Herschler   
Monday, 05 July 2010 16:30

 SELECTED COUNTIES 

Medical Doctors                          # of Active  Licensees 

Alachua                                                      1635

Brevard                                                      1201

Broward                                                     4696

Collier                                                          802

Dade                                                          7229

Duval                                                         2830 

Escambia                                                   848 

Hillsborough                                           3695

Lee                                                             1250

Liberty                                                        1 

Orange                                                     2956

Palm Beach                                             3789

Pinellas                                                    2724

Polk                                                           948

Sarasota                                                  1106

Seminole                                                   791

Volusia                                                      970

                         SOURCE: FL DOH 

 

Last Updated on Monday, 04 April 2011 06:12
 
By the Numbers-Provider Type Print E-mail
Written by Jeffrey Herschler   
Monday, 05 July 2010 15:51
SELECT FLORIDA HEALTHCARE LICENSEES 
 
Provider Type                                         # of Licensees
                                                                 Statewide
 
Chiropractic Physician                         5,165
Medical Doctor                                    55,147
Osteopathic Physician                         5,224
Podiatrist                                                1,636
Physician Assistant                              5,008
Registered Nurse                               231,505
Last Updated on Monday, 04 April 2011 06:11
 
Interview Exclusive - Executive Commentary on HCR (conclusion) Print E-mail
Written by Jeffrey Herschler   
Monday, 05 July 2010 15:43

Publisher's note:

I was in Orlando April 22nd and 23rd attending the Florida Institute of CPA's Annual Health Care Industry Conference (www.FICPA.org).

There, I had the opportunity to interview Micky Smith, CEO of Oak Hill Hospital, Lee Huntley, CEO of Central Florida Health Alliance and John Kolosky, COO of H. Lee Moffitt Cancer Center.  Excerpts from that meeting were published last week. I caught up with Mr. Smith, Mr. Huntley and Mr. Kolosky recently and posed one final question.  Thanks for reading FHIweekly.

 Jeff Herschler

Proponents of Obama Care predict that 21st century healthcare providers will meet the current challenges and that today's healthcare practices and facilities can not only survive but perhaps even prosper.

And of course the cynics are predicting runaway costs, unfunded liabilities and a nation headed towards mediocrity, a lower standard of living and crushing debts.

Who is closer to the truth, the buoyant optimists or the doomsday prophets?

Mr. Smith stated, "As always, the truth lies somewhere in the middle. The most powerful engine in healthcare reform is data transparency. Look how the rate of hospital acquired infections in Florida has plummeted since the state began publishing that information on the web. As cost, pricing, and quality data is shared with the consumer, ultimately at the physician level, we will see dramatic improvements in our health care system. If for no other reason that the poor performers will disappear."

Mr Huntley added, "I'd say it is too soon to tell.  It's true that as an industry, health care is expensive, highly regulated and cannot afford itself as millions of boomers enter the bounds of Medicare while at the same time trying to cover 60 million uninsured.  I'm biased as a provider of care. Too much too fast with too little input by experts into big government's solution. On the other hand, Obama tried. I can tell you this, healthcare won't prosper, especially as funds are reallocated from one topic to another, without regulatory relief. There are a lot of good ideas though, inside healthcare reform: e.g. bundling, emphasis on primary care and more.  But one not there is individuals and society taking responsibility for their own health status. Heck, we can't even regulate fat, sodium ridden fast food.  Sorry to be all over the place on this one.  It's just too soon to tell.  My gut: 40% buoyant optimism, 60% pessimism."

Mr. Kolosky responded, "This is more related to the riots in Greece than we would like to think.  We simply cannot afford the way we have always done things. The Bad News:  We, as a society, are living beyond our means, and runaway health care costs are one manifestation.  The Good News:  We, as a society, have faced bigger challenges head on and addressed them.  So why be optimistic?  When we face these challenges and deal with them, we are better off as a society.   This will not be painless.  When we take "waste" out of the system  in, for example, administrative bureaucracy, we will cost jobs and changes to people's careers. When we take duplicative or unnecessary services out of the system, we will cost someone money.  When we hold people accountable for performance, it may be revelatory and somewhat painful. However, we will adjust and be better off than we were before.   More importantly, patients will be better off than before.  So, in the end, I'm optimistic.......but as my doctor sometimes says "this may hurt a bit"." 

Last Updated on Thursday, 23 December 2010 07:04
 
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