Medical Board Issues Alert on Fraudulent “Notice to Cease and Desist” Letter Regarding Daily Deal Sites

 

It has come to the attention of the Medical Board of California (Medical Board) that a letter purported to have come from a Medical Board Investigator in the Discipline Coordination Unit has been received by a number of physicians throughout the State. This letter is entitled “Notice to Cease and Desist”, and warns physicians to immediately cease and desist from conducting any daily deal marketing arrangements with sites such as Groupon, Living Social, Amazon, etc.

This “cease and desist” letter (View Letter) was not generated by the Medical Board or any investigator employed by the Medical Board. Disciplinary action will not be pursued against a physician’s license for failing to comply with these fraudulent cease and desist letters.

When the Medical Board receives any complaint regarding a physician, including the use of Groupon, Living Social, Amazon, or other marketing sites, the complaint is evaluated on a case-by-case basis to determine whether there is a violation of the law.

If you receive a cease and desist letter, and wish to verify its authenticity, please contact the Medical Board at 916-263-2528.

CPMA urges members to use extreme caution when using such sites. While each deal varies, typically the doctor agrees to give the coupon company a percentage of the revenue obtained from patients using the coupon (reports suggest as high as 50 percent) in return for the marketing company's promotion of the practice through various types of coupons or "daily deals."

Even if patients using such coupons are cash-paying and non-insured, the activity raises significant legal issues for providers. Accordingly, doctors should act with extreme caution in this area, after obtaining the advice of an attorney experienced in health care fraud and abuse laws.