Communicating with prospective customers: What you can (and cannot) do

Jeffrey S. Baird is chairman of the Health Care Group of Brown & Fortunato, a law firm based in Amarillo, Texas. He represents HME providers, pharmacies and other health care providers throughout the U.S. The following is a Q&A he authored.

AMARILLO, Texas—Before an HME supplier can communicate with a prospective customer, there are multiple federal statutes and regulations that the supplier must understand—and follow. This Q&A discusses those requirements:

As an HME supplier, I have never thought about paying attention to the Federal Communications Commission (FCC) and Federal Trade Commission (FTC). Do these two governmental agencies have any jurisdiction over how I communicate with prospective customers?

Yes. Regardless of whether the customer is a governmental beneficiary, telephone calls and messages designed to encourage the purchase or rental of DME are regulated by the FCC. Likewise, the FTC enforces rules and regulations that protect against deceptive, misleading and abusive telemarketing practices.

So what exactly are these rules?

Under both the FTC and FCC rules, suppliers seeking to market products may not call a residential line before 8 a.m. or after 9 p.m., unless the individual has consented to the contact. Further, both the FTC and the FCC prohibit calls to a residential line listed on the National Do-Not-Call Registry unless the person has given written consent for the contact or the company has a business relationship with the person. Finally, suppliers seeking to market their products may not call a person who has requested to not receive any such calls from or on behalf of the supplier. Both the FTC and the FCC rules limit the liability of entities that enforce written policies and procedures in order to comply with these rules.

Are there any restrictions if I want to communicate with prospective customers by e-mail?

Yes. The Controlling the Assault of Non-Solicited Pornography and Marketing Act (CAN-SPAM Act) regulates e-mail messages sent to consumers. When an HME supplier sends an e-mail that primarily conveys a commercial message and is designed to promote the supplier’s products and services, the supplier must comply with all of the following requirements:

• The e-mail’s header and subject line may not contain false or misleading information.
• The e-mail must be identified as an advertisement.
• The contact and address information of the supplier must be included in the e-mail.
• The e-mail must instruct the recipient on how to opt-out of future e-mails.
• And the supplier must honor opt-out requests.

Can an e-mail be exempt from the CAN-SPAM requirements?

Yes. An e-mail that is primarily “transactional or relationship” is exempt from most of the CAN-SPAM requirements. If the e-mail recipient purchases items offered by the sender on an ongoing basis, an e-mail that notifies the recipient of “a change in terms or features (or) a change in the recipient’s standing or status” is considered transactional. When an e-mail contains both transactional and commercial information, the primary purpose of the e-mail will determine whether the e-mail must comply with all of the CAN-SPAM requirements. Generally, the information in the subject line and at the beginning of the message establishes the primary purpose of the e-mail.

What other restrictions/guidelines govern communication by an HME supplier with a prospective customer?

The federal telephone solicitation statute says that a supplier may not call a prospective customer regarding a Medicare-covered item unless the prospective customer has first given his written consent to be called. The written consent can be either electronic or “blue ink” and the consent must be specific to the supplier. The same requirement is contained in Supplier Standard No. 11.

How does all of this apply when an HME supplier purchases the assets of another HME supplier and, along with the purchase, the seller transfers its customer files to the buyer?

As a condition to closing the asset purchase, the buyer should require the seller to send its patients written notice regarding the asset purchase. The letter should inform patient that unless there is objection, the patient’s files will be transferred to the buyer. This letter will meet the prerequisites for the disclosure of protected health information (PHI) under HIPAA. At the same time, the letter will give the buyer the opportunity to seek written consent to call the customer. With the notice letter, the seller should send a separate consent card for the customer to be called by the buyer with the request that the customer return the consent card to the buyer. Additionally, the buyer may seek the customer’s consent to be called through an e-mail. Lastly, the seller can call its customers and explain that they will be receiving the consent card and suggest that the customers sign and return the card to the buyer.

Baird can be reached at 806-345-6320 or [email protected].