Business Services, Dental

Florida Patient Brokering Act: Dental Referrals, Fees and Deals

February 19, 2024

Reviewed by Erik Newton, Esq., on November 7, 2026.

Key takeaways

Section 817.505 applies to any person and to patients of every payer, not only Medicare and Medicaid.
Its main exception brings in the federal Anti-Kickback Statute’s safe harbors.
Penalties rise with the patient count, up to a first-degree felony and a $500,000 fine.
A dentist’s license is exposed too.
In a sale, read every payment that rises or falls with patients.

Many dentists file kickback law under Medicare and Medicaid, and a practice with few government-program patients assumes it has little to worry about. Florida’s statute does not work that way. Section 817.505, Florida Statutes, the Patient Brokering Act, makes it a felony to pay a commission, bonus, kickback or other benefit to induce a patient referral, or to take one in return for a referral, whoever pays for the care.

It matters most when a practice changes hands. A marketing fee priced per new patient, an MSO fee set as a percentage, an earn-out keyed to patient counts: each moves with patients, and each is a question for the buyer’s diligence and the seller’s representations.

Section 817.505 reaches every payer, not only Medicare and Medicaid

Subsection (1) of section 817.505 makes it unlawful for any person, including any health care provider or facility, to offer or pay a commission, benefit, bonus, rebate, kickback or bribe, or engage in a split-fee arrangement, to induce the referral of a patient or patronage; to solicit or receive one in return for a referral or for accepting treatment; or to aid, abet or participate in any of these. Payment counts “directly or indirectly, in cash or in kind,” so a gift card or free service counts as much as a check.

“Health care provider” covers anyone licensed, certified or registered with the Department of Health or the Agency for Health Care Administration, which takes in every Florida dentist (ss. 466.003, 466.004 and 466.006, Fla. Stat.). Because the statute applies to “any person,” it also reaches marketers, MSOs and patients.

Nothing in subsection (1) limits the statute to patients of Medicare, Medicaid or any other government program; a cash or commercially insured patient is covered the same way. Can a Florida dentist pay or receive a referral fee? Unless an exception applies, no: not to or from an oral surgeon, a marketer or a patient.

The exceptions are narrow, and the federal safe harbors do most of the work

Subsection (3) lists ten payment practices the statute does not reach. Four matter most to a dental practice:

(3)(a): any payment practice “not prohibited by 42 U.S.C. s. 1320a-7b(b) or regulations promulgated thereunder,” which brings in the federal safe harbors at 42 C.F.R. s. 1001.952 for rentals, personal services and management contracts, practice sales and bona fide employees, among others.
(3)(b): payments within a group practice as defined in s. 456.053, Fla. Stat., and not to or from outsiders.
(3)(c): payments for professional consultation services.
(3)(i): fees to an information service that is free to consumers and, among other conditions, does not steer them to a provider, set in advance, consistent with fair market value, and not based on the potential value of a patient.

The rest cover insurer and health plan payments, insurance agents, insurance advertising gifts, nurse registries and assisted living facilities. There is no standalone exception for employee referral programs or copay waivers.

The wording of (3)(a) has moved: a 2019 amendment narrowed it to practices “expressly authorized by” the federal statute’s exceptions or its regulations (ch. 2019-159, Laws of Fla.), and a 2020 amendment restored “not prohibited by,” effective July 1, 2020 (ch. 2020-38, Laws of Fla.). Whether an arrangement with no federal program patients is “not prohibited” by a federal law that does not reach it is a question of interpretation.

If you are buying or selling a practice whose fees rise or fall with patient numbers, have them read against subsection (3) before the deal terms are set. Schedule a confidential consultation

A violation is a felony, and federal and licensing law add their own exposure

Subsection (4) grades the crime by patient count: a third-degree felony and a $50,000 fine; at 10 to 19 patients, a second-degree felony and a $100,000 fine; at 20 or more, a first-degree felony and a $500,000 fine. Under s. 775.082, Fla. Stat., those carry up to 5, 15 and 30 years in prison. The tiers date from 2017 (ch. 2017-173, Laws of Fla.) and were untouched by the 2019 and 2020 amendments. Subsection (4) also names a business’s officers, agents and other representatives.

The federal Anti-Kickback Statute, 42 U.S.C. s. 1320a-7b(b), is narrower. It covers only items and services payable in whole or in part under a Federal health care program, which includes Medicaid, and only knowing and willful conduct, though not actual knowledge of the statute itself. A violation is a felony with a fine of up to $100,000, up to 10 years in prison, or both. The Florida statute has no payer limit, and its subsection (1) does not use the words “knowingly and willfully.”

Florida also has a licensee kickback statute. Section 456.054 makes it unlawful for any health care provider to offer, pay, solicit or receive a kickback (defined as a referral payment that is not tax deductible as an ordinary and necessary expense) for referring or soliciting patients; a violation “shall be considered patient brokering,” punished under s. 817.505. Under s. 466.028(1)(oo), any violation of chapter 456 is a ground for discipline by the Board of Dentistry. And s. 456.0635 bars renewal of a license for 10 years after the sentence and any probation end on a third-degree felony conviction or plea under chapter 817, and 15 years on a first- or second-degree felony, with a pretrial diversion exception.

In a practice sale, the risk sits in payments that move with patients

Diligence should list every contract under which money changes hands in connection with patients, and the purchase agreement should carry the seller’s representation that none of them violates s. 817.505 or the federal statute. Raise it before the letter of intent is signed.

Marketing and lead-generation fees

Some vendors price per lead, per booked appointment or per new patient. Subsection (1)(a) asks whether a payment is made “to induce the referral of a patient or patronage,” and a fee counted per patient invites that question. The personal services safe harbor, which (3)(a) brings in, requires, among other conditions, a signed written agreement of at least one year covering all the services, with a compensation methodology set in advance, consistent with fair market value, and not determined in a manner that takes into account the volume or value of federal program referrals or business generated between the parties.

Percentage fees under an MSO agreement

Section 466.0285, Fla. Stat., already bars a non-dentist from controlling a dentist’s clinical judgment, patient records, pricing, advertising, personnel or hours (Can a Non-Dentist Own a Dental Practice in Florida?). The fee is the other half. A percentage of collections moves with patient volume, and whether it can meet the safe harbor’s volume-or-value condition should be settled before signing: the federal Office of Inspector General says an arrangement “must fit squarely in the safe harbor and satisfy all of its requirements.”

Referral arrangements with oral surgeons, endodontists and orthodontists

The referral is not the problem; payment for it is. A fee to the referring office, free staff or below-market space can each be a benefit tied to referrals. Consultation fees are excepted by (3)(c), and rentals can fit the federal safe harbors, which require, among other conditions, a signed lease of at least one year with rent set in advance, consistent with fair market value, and not determined in a manner that takes into account the volume or value of federal program referrals.

Earn-outs and payments to the seller after closing

An earn-out keyed to new patient counts, paid to a seller who stays on and can send patients to the buyer, raises the question subsection (1)(b) asks: is the seller receiving a benefit in return for referrals? The federal sale-of-practice safe harbor covers a sale between practitioners only if it closes within one year of the first agreement and, after one year from that agreement, the seller is not in a professional position to refer to, or generate federal program business for, the buyer. A sale to a hospital or other entity, such as a DSO, has a narrower version that, among other conditions, requires a practice in a Health Professional Shortage Area. The mechanics are in How to Structure Earn-Out Agreements in Dental Practice Sales.

Read every payment that moves with patients before you sign

In a sale, the practical work under section 817.505 is an inventory of every contract under which money moves with patients, read against subsection (3) and the safe harbors, with anything that does not fit restructured before closing or addressed in the purchase agreement. How a deal runs is on the dental practice sale and acquisition page.

If you are selling to a DSO or an MSO-backed buyer, or buying a practice whose marketing and referral contracts you have not read yet, have them reviewed before you sign the letter of intent. Schedule a confidential consultation

Frequently asked questions

What is patient brokering in Florida?

Patient brokering is offering or paying a commission, bonus, rebate, kickback, bribe or split fee, in cash or in kind, to induce a patient referral, or soliciting or receiving one in return for a referral. Section 817.505, Florida Statutes, also covers taking a benefit for accepting treatment, and it applies to any person, not only licensed providers.

Does the Florida Patient Brokering Act apply only to Medicare and Medicaid patients?

No. Nothing in subsection (1) of section 817.505 limits it to government program patients, so it covers cash and commercially insured patients too. The federal Anti-Kickback Statute is the one limited to items and services payable under a Federal health care program, which includes Medicaid.

What is the penalty for patient brokering in Florida?

A violation is a third-degree felony with a $50,000 fine; at 10 to 19 patients, a second-degree felony with a $100,000 fine; at 20 or more, a first-degree felony with a $500,000 fine. For a dentist, a felony conviction or plea under chapter 817 also generally bars license renewal under s. 456.0635, Fla. Stat., for 10 or 15 years after the sentence and any probation end.