by Mario Fucinari •
DC, CPCO, CPPM, CIC •
As healthcare regulations become more complex and insurance reimbursement decreases, many chiropractors are turning to cash-based practices for greater freedom, improved patient relationships, and simplified office procedures. While a cash practice offers numerous benefits, it also entails its own set of legal and ethical responsibilities. Navigating the rules and regulations of operating a cash practice is essential for long-term sustainability and protection from regulatory scrutiny.
This article will guide you through the key legal considerations, compliance best practices, and strategic insights needed to run a successful chiropractic cash practice within the bounds of federal and state laws.
Understanding the Nature of a Cash Practice
A cash practice refers to a setting where patients pay directly for services at the time of care without filing claims with insurance carriers. It doesn’t necessarily mean payment must be in physical cash—credit cards, checks, health savings accounts (HSAs), and other forms of direct payment are also considered “cash” in this context.
Operating outside the insurance model offers freedom from some paperwork, pre-authorizations, and documentation burdens associated with third-party payers. However, eliminating insurance does not mean alleviating compliance obligations. Chiropractors must still adhere to state practice acts, federal healthcare regulations, and billing transparency rules.
Transparency and Informed Consent
One of the most critical areas of compliance in a cash practice is price transparency. Patients must be informed of fees before services are rendered. Consider the following best practices:
- Transparent Fee Schedule: The No Surprises Act (NSA) is a federal law that protects patients from surprise bills. Patients who are paying cash, do not have insurance coverage, or elect not to use their insurance benefits must be informed in writing of all costs expected before services are rendered. This notification is through the Good Faith Estimate. The NSA does not pertain to Medicare Part B. It does, however, pertain to Medicare Advantage, cash patients, and in some instances, is recommended for personal injury patients. Consider offering your cash patients a legally structured discount medical plan, such as ChiroHealthUSA, that allows chiropractors to provide discounted rates to uninsured patients, those using Medicare, or those without chiropractic benefits. Using ChiroHealthUSA relieves you of the requirement to provide a Good Faith Estimate.
- Financial Policies: Provide patients with a written financial policy outlining payment expectations, refund policies, and service package options. I recommend including a notice stating that it is the patient’s responsibility to pay for collection costs if permitted by your state law.
- Informed Consent: Treating a cash patient still requires prudent risk management procedures. Always obtain a written informed consent that outlines the services you will render, the risks and benefits of care, and that the patient can ask questions. Patients must be capable of making decisions and able to fully comprehend the content of the document to make an informed decision. If English is not the patient’s primary language, consider having the informed consent and other legal documents in their language.
Transparency reduces the risk of patient complaints and regulatory inquiries. It also builds trust.
Legal and Ethical Marketing Practices
Cash practices often rely heavily on community outreach, social media, and patient referrals. However, marketing practices must remain compliant with state board regulations and Federal Trade Commission (FTC) rules.
Avoid:
- Making exaggerated health claims
- Offering “free” services that are conditional or misleading
- Providing testimonials that don’t comply with advertising rules
- Implied promises of cure
Be accurate, truthful, and professional in your advertising. Ensure that disclaimers are included when appropriate, particularly for federally funded healthcare programs and wellness-based services.
Discounting and Prepayment Plans
Many chiropractors offer discount packages or prepayment plans in cash practices, but these can become legal traps if not handled correctly. Here’s what you need to know:
- Avoid Misrepresenting Discounts: If you offer a discount, make sure it is a genuine discount and clearly documented. Don’t list inflated “retail prices” only to show exaggerated “discounted rates.”
- Comply with State Laws: Some states have strict rules on prepayments and concierge care, including limits on the amount that can be collected upfront or requirements for placing funds in escrow.
- Avoid Violations of Insurance Law: If you offer discounted rates to cash patients while participating with insurance, you must be careful not to violate the Anti-Kickback Statute (AKS). The Anti-Kickback regulation, 42 C.F.R. § 1001.952, makes it a felony to offer anything of value, including free or discounted services, to induce the use or purchase of any goods or services that are reimbursable by federal or state healthcare programs. Federal and state regulations restrict time-of-service discounts to 5-15%; otherwise, it could be considered dual fee-scheduling or even fraud.
HIPAA Compliance Still Applies
Even in a cash practice, HIPAA (Health Insurance Portability and Accountability Act) still applies. You must protect patient health information (PHI) and maintain accurate and up-to-date records to ensure patient confidentiality. Just because you’re not submitting insurance claims doesn’t mean you can ignore documentation standards.
Maintain:
- Secure electronic health records (EHR) or paper files
- HIPAA Privacy notices and acknowledgments
- Business associate agreements (if you use third-party vendors like shredding companies)
- A compliant process for patient record requests
Failure to meet HIPAA requirements can result in severe fines, even for small practices.
Documentation and Medical Necessity
Even though you’re not billing insurance, clinical documentation remains essential for both legal protection and the delivery of patient care. The Board of Chiropractic Examiners for your state has regulations governing the scope of practice in your state. The regulations include specific details for documentation and record retention. Good documentation supports your clinical decisions, communicates care plans, and protects you in the event of a board complaint or malpractice allegation. Ethically, your documentation serves as a historical record of a patient’s treatment that they must have access to in the event of a transfer of care or an unforeseen circumstance affecting the provider. The primary purpose of the Chiropractic Board of Examiners is to protect the public and to regulate the profession, regardless of insurance status.
Ensure your notes reflect:
- Subjective complaints
- Objective findings
- Assessment of the progress in the case and diagnosis
- Plan of care and treatment rationale
- Signature (electronic or hand-written)
Medicare Considerations
One of the most commonly misunderstood areas in a chiropractic cash practice is Medicare. (MedLearn Matters SE0479) Under federal law, chiropractors are not permitted to opt out of Medicare. If a patient is Medicare-eligible, you must be an approved Medicare provider and can file a claim on behalf of the patient for active care or, if requested by the patient, for inactive or non-covered care. A patient cannot be coerced into choosing a particular option on an Advance Beneficiary Notice (ABN).
You cannot charge a Medicare beneficiary cash for covered chiropractic services unless it is for maintenance care. Even in these instances, you must notify the patient in writing before services are rendered. Failure to comply can result in civil penalties and demands for repayment.
State Board Regulations and Audits
Each state has its chiropractic board and corresponding rules. These can include:
- Recordkeeping standards
- Fee disclosure requirements
- Rules for unlicensed staff or delegated services
- Continuing education (CE) obligations
It’s important to review your state board’s rules regularly, attend state-approved continuing education classes that cover legal updates, and even seek consultation from a healthcare attorney if you’re unsure about a policy.
Keep in mind: even if you are not billing insurance, you can still be subject to a state board audit or investigation, often triggered by a patient complaint.
Conclusion
Transitioning to or maintaining a cash chiropractic practice can be a liberating and rewarding choice. It allows chiropractors to focus more on patient outcomes and less on insurance bureaucracy. However, with that freedom comes a responsibility to ensure that your practice is ethically grounded, legally compliant, and fully transparent.
By staying informed, documenting diligently, and fostering open communication with patients, you can protect your license, your reputation, and your livelihood—all while delivering high-quality, patient-centered care.
If you’re unsure about any aspect of compliance, consult your state board, a healthcare attorney, or a risk management advisor. A proactive approach is always less costly than a reactive one.
Disclaimer
This publication is for general information on pertinent legal and risk management topics. The statements made are provided for educational purposes only. They do not constitute legal or financial advice. If you have specific questions as to the application of the law to your activities, you should seek the advice of your legal counsel.
About the author
Dr. Mario Fucinari is a Certified Professional Compliance Officer, Certified Physician Practice Manager, Certified Insurance Consultant, and a Medicare Carrier Advisory Committee member. As a ChiroHealthUSA Speaker’s Bureau member, Dr. Fucinari travels throughout the year, speaking to audiences nationwide and sharing his chiropractic expertise and insights into using best practices for documentation, compliance, billing, and coding. To have Dr. Fucinari speak at your conventions or webinars, contact him at doc@askmario.com or call ChiroHealthUSA for availability.
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Why is the Discount Challenge prize amount $15,024? Because that is the average “per-occurrence” fine for Medicare inducements. That’s not $15,024 per patient, that’s not per provider, that’s PER VISIT. Stinks, doesn’t it? To us, the prize amount is worth the investment if we can help our profession better understand proper discounting.