Does Your Sales Team Know When Client Entertainment Is a Kickback?

The competition among healthcare technology companies is fierce, with each vying for a larger share of the market. However, where there is intense competition, the Department of Justice (DOJ) is quick to investigate and take action against any alleged misrepresentation of software capabilities or involvement in kickback schemes. Two recent False Claims Act cases serve as a reminder that it is crucial for healthcare software companies to have clear policies regarding the use of entertainment in the sales process.

To avoid any potential legal issues, it is essential for technology companies to establish written entertainment policies that outline how their sales teams can engage in client entertainment. These policies should provide clear guidelines on the acceptable use of tickets, dinners, and other forms of entertainment. By clearly defining what is considered appropriate, companies can ensure that their sales teams are aware of the boundaries and can avoid inadvertent violations.

In addition to having well-defined policies, it is equally important to provide comprehensive training to the sales team. They should be educated on what constitutes a kickback when it comes to entertainment. This training should cover the legal implications of providing entertainment in exchange for business and emphasize the importance of maintaining ethical practices.

By implementing these measures, healthcare technology companies can mitigate the risk of inadvertently violating any laws. Clear entertainment policies and thorough training not only protect the company from potential legal consequences but also promote a culture of transparency and integrity within the organization.

It's always better to be proactive in adhering to legal and ethical standards than to face the DOJ.