Introduction: The Purpose of the New FTC Guidelines

On August 14, 2024, the Federal Trade Commission (FTC) announced a major update to its regulations: a new final rule designed to crack down on fake reviews, misleading consumer testimonials, and other deceptive practices in online marketing. With this new rule, the FTC is taking a hard stance on ensuring transparency and authenticity in how businesses—especially those in high-stakes industries like healthcare—market their products and services. Set to take effect 60 days after its publication in the Federal Register (a.k.a. October 13, 2024) the rule will empower the FTC to seek civil penalties for violations and strengthen its ability to enforce honest advertising practices.

But what does that really mean for healthcare providers?

Well, consider how much weight patients place on online reviews when choosing a provider. For many, browsing reviews is a first step in selecting a new doctor, clinic, or specialist. In fact, a recent survey found that nearly 77% of patients check reviews before deciding where to receive care. That means, unlike other industries, healthcare can’t afford to slip up when it comes to maintaining a trustworthy digital presence.

With the new rule in place, the stakes are even higher. A single misleading review or an undisclosed material relationship could land a provider in hot water, resulting in hefty civil penalties and serious damage to the organization’s reputation. Beyond the financial risks, any perception of dishonest or unethical practices could break the delicate bond of trust between healthcare professionals and their patients—something that is much harder to rebuild than it is to lose.

This article will break down the most critical aspects of the FTC’s new guidelines, specifically highlighting what healthcare organizations need to watch out for and offering practical strategies for compliance. We’ll cover the deceptive practices targeted by the ruling, including fake consumer reviews, incentivized reviews, and insider testimonials, and then provide a roadmap for navigating these changes without compromising your credibility or patient relationships.

Key Issues Addressed by the New Guidelines

The FTC’s latest rule targets a wide range of deceptive consumer reviews and testimonial practices that mislead or manipulate public perception. Here’s a closer look at some of the core issues the FTC aims to eliminate:

1. Fake or False Consumer Reviews and Testimonials

One of the most prominent changes in the new rule is the strict prohibition against fake consumer reviews and false reviews. Under this ruling, businesses are banned from creating, purchasing, or using AI-generated fake reviews, fabricated testimonials, or any deceptive reviews that give a false impression of a patient’s experience or the quality of the services provided.

But what qualifies as “fake” or “false”? It’s more than just a matter of honesty—it’s about intent and impact. The FTC defines a fake review as one that misrepresents the identity of the reviewer, falsifies their experience, or simply doesn’t come from a real person at all. This includes AI-generated reviews, which can be created at scale to look authentic but, in reality, deceive consumers by presenting fictional experiences as real ones.

Why This Matters for Healthcare

Patients rely on authentic reviews to make informed decisions about their health. If a patient chooses a provider based on misleading or deceptive advertising, it could have serious consequences for their well-being. Beyond the civil penalties the FTC can impose, the healthcare provider risks losing credibility and trust in the community—something that can be hard, if not impossible, to recover.

Take, for example, a scenario where a dental practice buys AI-generated fake reviews to improve its online reputation. While this may initially attract more patients, the truth will eventually come out, causing reputational damage, patient loss, and even potential legal action.

2. Incentivized Reviews and Consumer Testimonials

The new rule also takes aim at incentivized reviews, which occur when a business offers some form of reward—be it a gift card, discount, or even special treatment—in exchange for a review. While this isn’t inherently unethical, the FTC has made it clear that conspicuous disclosure of this material relationship is a must. Any compensation that influences the content of a review must be clearly and prominently disclosed.

For healthcare organizations, this means being extremely cautious when encouraging patient feedback. Even if the intent is positive—say, thanking a patient for their review by offering a future discount—the nature of this transaction must be made crystal clear to anyone reading the review.

Healthcare Example:

Let’s say a wellness clinic decides to offer patients a 10% discount on their next visit if they leave a 5-star review on a third-party review platform like Google. If the clinic doesn’t disclose this incentive openly in the review itself, they’re risking a serious violation of the FTC’s guidelines. Even a seemingly harmless “thank you gift” can be construed as deceptive if it’s not handled transparently.

3. Insider Reviews and Employee Testimonials

The new rule explicitly bans insider consumer reviews—testimonials posted by employees, officers, or managers without disclosing their connection to the business. If these insider reviews are presented as genuine, independent feedback, it can mislead prospective patients into believing the reviews are impartial.

The FTC is particularly focused on ensuring that any material relationship is disclosed conspicuously. This means that if an employee or manager leaves a review for their clinic, they must clearly state their role. Any ambiguity or omission can be grounds for a violation.

Why It’s Important in Healthcare

Imagine a small family practice where several staff members leave positive reviews for the clinic, hoping to boost its visibility. If they don’t disclose their employment status, it creates a false impression of the clinic’s patient satisfaction. Patients who feel misled may not just take their business elsewhere—they could also post negative reviews calling out the deceptive practice, creating a domino effect of reputational damage.

4. Company-Controlled Review Websites

Another area addressed by the rule is company-controlled review websites—sites that are set up to look like independent, third-party platforms but are actually managed by the business itself. These sites often display curated reviews that only highlight positive feedback while filtering out any negative consumer reviews.

For healthcare organizations, hosting a review site that hides or selectively showcases testimonials without clear disclosure is a red flag. If a practice is caught operating a company-controlled review website that misleads visitors into believing the reviews are unbiased, it could face severe civil penalties and damage to its reputation.

5. Misuse of Social Media Indicators

Lastly, the rule prohibits businesses from buying or selling fake social media indicators like followers, likes, or shares to create the illusion of high social media influence. These fake indicators can deceive consumers into believing that a provider is more reputable or popular than it actually is, which can unfairly divert business from honest competitors.

Healthcare Example:

A plastic surgery clinic might buy thousands of fake followers on Instagram to make it appear more established. While this might initially attract more interest, if discovered, it can backfire spectacularly, undermining patient trust and opening the clinic to FTC scrutiny.

By detailing these key issues and providing relevant healthcare-specific examples, healthcare organizations can better understand the new landscape and take proactive steps to align their review management practices with the FTC’s regulations. Ultimately, the goal is to promote an environment of honest advertising practices where patients can trust that the information they find online is accurate, reliable, and free from manipulation.

1. Review and Audit All Consumer Review Practices

Conduct a thorough audit of all current consumer reviews and testimonials to identify any potential deceptive practices. Check for insider consumer reviews, hidden negative consumer reviews, or misleading social media indicators that could lead to violations. A regular audit will help ensure that your review practices remain transparent and compliant.

2. Establish Transparent Testimonial and Review Policies

Develop internal policies that promote ethical testimonial practices and transparency. Include guidelines on how to handle incentivized reviews and clearly disclose all material relationships to avoid any confusion or misleading perceptions.

3. Train Staff on Ethical Review Practices

Educate staff on the FTC’s regulations and train them to handle patient feedback ethically. Make sure all employees are aware of the consequences of deceptive practices and the importance of maintaining proper disclosure in all reviews.

4. Monitor Social Media Engagement and Influence

Implement monitoring tools to regularly check your social media influence for compliance. Avoid any attempt to manipulate engagement through fake indicators like purchased followers or automated views. This helps ensure that your social media presence genuinely reflects your patient interactions.

5. Set Up a Policy for Handling Negative Reviews

Create a clear policy for responding to negative reviews professionally and constructively. Address patient concerns transparently and never resort to legal threats or intimidation tactics to suppress honest feedback.

6. Utilize Independent Review Platforms

Encourage patients to leave reviews on credible third-party review platforms rather than relying on company-controlled review websites. This promotes transparency and builds trust with potential patients.

7. Stay Updated on Regulatory Changes

The FTC’s ruling is part of a broader effort to enhance transparency in consumer review hosting and advertising practices. Regularly review your policies and consult legal advice as necessary to stay compliant.

Consequences of Non-Compliance

Healthcare organizations found violating the FTC’s guidelines could face fines of up to $51,744 per violation. The potential for civil penalties makes it critical to adopt compliant marketing practices. Additionally, the reputational damage from being labeled as deceptive can lead to a loss of patient trust and credibility, harming the practice in the long run. 

Final Thoughts: Embracing Compliance and Transparency

The FTC’s new guidelines represent a shift towards greater accountability and transparency in digital marketing. Healthcare providers must prioritize compliance by embracing ethical marketing practices and maintaining transparent review management. By implementing these strategies, organizations can build trust, avoid costly enforcement actions, and set a new standard for ethical healthcare marketing.

Don’t risk non-compliance—secure your practice’s reputation! Contact Clyck to manage your reviews with professionals trained in healthcare regulations and HIPAA standards.