georgia corporate practice of medicine

Our state licensure and corporate practice attorneys have decades of combined experience in this unique area of the law, working with hundreds of clients to design, establish, counsel, and repair the legal structures necessary to permit non-licensed investors to establish and develop partnerships with licensed health care providers. As a general breakdown, the following states follow the CPOM: Arizona Arkansas California Colorado Connecticut Georgia Illinois Indiana Iowa Kansas Kentucky Louisiana Maryland Massachusetts Michigan Minnesota Montana Nevada New Jersey New York North Carolina North Dakota Ohio Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Washington West Virginia Wisconsin. If state law requires the stockholder to have beneficial as well as legal title to the stock, the PSC will probably not qualify for exemption. Medical Groups, Medical Centers Florida Statute 463.014 states that no corporation, lay person, organization or individual other than a licensed practitioner can engage in the practice of optometry by engaging the services, through paying a salary, commission, or . billing and collecting on behalf of the Professional Medical Corporation. She represents physicians, dentists, medical group practices, and other health-related entities in transactional, regulatory, and compliance matters. When evaluating the various legal and regulatory hurdles associated with telehealthsuch as licensure, reimbursement, and privacy one hurdle that often goes overlooked is the corporate practice of medicine. Local, state, and federal government websites often end in .gov. Healthcare Facilities This ban on the corporate practice of medicine (CPM) . Washington, DC, Partner | And sometimes, the medical board may be more aggressive in its interpretation, signaling a strong enforcement posture to the Attorney General or District Attorney who will actually be the one prosecuting the case. The Corporate Practice of Medicine: Is It Applicable for Your Client? Georgia law provides a fairly typical definition of the "practice of medicine" (O.C.G.A., Section 43-34-21) as well as a prohibition against unlicensed practice of medicine (Section 43-34-22 (a)). 1.5021(b). [Please note: Board Rules are currently being re-written to comply with changes to the Medical Practice Act that were passed by the Georgia General Assembly during the most recent legislative session and will be updated on the website as changes to the rules are passed.]. 610-701-4416. Ownership is an indicator of control of a patients medical records, including determining the contents thereof, and should be retained by a California-licensed physician. But even states that abide by the Corporate Practice of Medicine doctrine might have allowable exceptions. (a) Health care corporations shall have the right to sell contracts providing for the payment of specified charges made by participating physicians furnishing medical or surgical care, or both, to the holders of such contracts, their beneficiaries, and covered dependents as provided for in this Code section. PSC irrevocably appoints Manager as its agent and attorney in fact with full power to enforce the terms of the SCA. 68-11-205 and 63-6-204 is a common law legal doctrine known as the "corporate practice of medicine" doctrine. OPEN SESSION Dr. Butler made a motion, seconded by Dr. Weil, to license Dr. Beirne with terms and conditions. GEORGIA COMPOSITE MEDICAL BOARD MINUTES June 7-8, 2012 Page 4 of 26 Dr. Is the MSO going too far into medical practice, in the eyes of the regulators who enforce the corporate practice of medicine prohibition? What is the corporate practice of medicine? Often, this language appears inconsistent when read in conjunction with the laws created to govern a Professional Corporation formed under a state's business corporation laws. In 2016, the Idaho Board of Medicine abandoned its position that Idaho law prohibits physicians from being employed by non-physicians. Board Rule 480-28, Practitioner Dispensing of Drugs. 1 This analysis assumes the organization is formed as a corporation, however the organization may be formed as some other type of legal entity allowable under the laws of the state, such as an LLC. Consider whether the applicant described, in detail, the methods and procedures through which the exempt parent controls the shareholder; If there are indicators of a lack of control by the exempt parent you should consider further development or consultation with counsel, if appropriate. the corporate practice of medicine regulations are action-able against your license to practice podiatry. These "corporate practice" restrictions are imposed by statute in some states, and in others by regulation or case law. Private equity and other nondoctor investment in U.S. health care has grown significantly over the past decade thanks to. The official Administrative Rules are published separately from the law and further clarify the regulations form the OCGA and are specific to the professions licensed by the Georgia Composite Medical Board. Please enable javascript. 2023 Fenton Law Group, LLP.All rights reserved. Sometimes the medical board website spells it out and pulls it all together. Georgia law provides a fairly typical definition of the practice of medicine (O.C.G.A., Section 43-34-21) as well as a prohibition against unlicensed practice of medicine (Section 43-34-22(a)). The corporate practice of medicine, or CPOM, is a doctrine that's enshrined in many states' laws, either by statute, which is the laws on the books, or by judge-made law case law. . Dietary Supplement Companies Performing pre-investment evaluation and due diligence, and, where necessary, amending or restating all documents related to Friendly PC or Captive PC arrangements, including entity formation documents, management agreements, continuity agreements, employment agreements, and lending or leasing agreements. PSC obtains managers approval of its compensation agreements with physicians. The court concluded that the medical practice was essentially under the control of the management company and the physician was a nominal owner; thus, because the medical practice was not legitimately structured, it was not allowed to submit medical insurance claims. Pennsylvania also permits health maintenance organizations (HMOs) and licensed hospitals and health care facilities to employ physicians and provide health care services. #healthcarelaw#healthlaw #healthlawattorney, The Newest Trend in Online Medicine: Telehealth, Cover your Assets. In terms of risk mitigation, here some key legal strategies the healthcare venture can bake into its operational plan: Your healthcare lawyer can provide nuanced advice as what is good for business, often is fodder for enforcement; and conversely, what is most compliant, is often neither efficient nor profitable. Because unlicensed and corporate practice of medicine are considered crimes, its important before starting up any healthcare venture to consult alaw firm that knows the ins and outs of the corporate practice of medicine doctrine. Compliance Issues for Consulting Fees, Honoraria, Medical Directorships, and Other Types of Remuneration. For example, what if the telemedicine or digital health venture or mobile app guides the user (aka patient) to a specific pathway of diagnostic tests and/or treatments? Healthcare providers must be careful to comply with the CPOM doctrine because violating these laws could result in a providers loss of license and repayment of all revenue for billed services to patients, insurance companies and the government, as well as other fines and penalties, including potential criminal issues. In order to avoid regulatory pitfalls, however, contractual MSO arrangements need to be structured carefully to ensure that . The SCA imposes the provisions of IRC 501(c)(3) on the operation of the PSC. ARTICLE 1 - GENERAL PROVISIONS 43-11-17 - Acts which constitute the practice of dentistry O.C.G.A. There are exceptions to the one field rule, notably in the Moscone Knox Professional Corporations Act, which allows some licensed healthcare professionals to be directors, employees, or shareholders in another professional corporation. legally may provide medical services except under the supervision, control and responsibility of a licensed physician. There are a few exceptions to the CPOM doctrine in Pennsylvania, including practicing medicine through a professional corporation, limited liability partnership, or restricted professional company. How would you know? The corporate practice of medicine (CPM) is a legal doctrine that prohibits companies from profiting from the practice of medicine or directly employing a physician to provide professional medical services. Crafting the right plan takes legal experience as well as knowledge of the corporate practice of medicine, anti-kickback and fee-splitting, and other legal pitfalls that can ensnare the healthcare venture. The policy expressed in Business and Professions Code section 2400 against the corporate practice of medicine is intended to prevent unlicensed persons from interfering with or influencing the physicians professional judgment. If you are a tax-exempt entity, you will also want to ensure the compensation reflects fair market value to avoid 501(c)(3) tax issues. Health care investors and health care business companies often look to partner with physicians, dentists, optometrists, therapists, and other licensed professionals. Again, regulatory authorities have a lot of enforcement discretion. For example, chiropractors and nurses can be up to 49% shareholders in a Professional Medical Corporation. There are usually exceptions to the corporate practice of medicine prohibitionnotably, for example, the case of hospitals. Selection, hiring/firing (as it relates to clinical competency or proficiency) of physicians, allied health staff and medical assistants. How you know. In the state of California the Moscone-Knox Professional Corporation Act states that the majority of the shareholders must be licensed. Following a model known as Practice Perfect, a New Jersey chiropractor incorporated a management company and a medical practice. Part Two. 2d 477 (E.D. Terms of Use, Disclaimer, and Privacy Policy, sublease space and/or provide equipment (each under a written lease or management agreement with the Professional Medical Corporation). If you keep reading, California takes the corporate practice of medicine very seriously. Guidelines for analyzing professional service corporation cases involving the Corporate Practice of Medicine (CPOM). Because the Professional Service Corporation (or PSC) is owned by natural persons (shareholders), it is normally a taxable corporation, however, the IRS will recognize a PSC as exempt if it meets certain stringent requirements. Professions and Occupations 12-36-134. Section 43-34-39 provides that the state medical board, in addition to any other remedy or criminal prosecution (emphasis added), may file a complaint to the superior court and seeking a restraining order and an injunction against any person, firm, company, partnership, association, or corporation or the agent, officer, or director of such firm, company, partnership, association, or corporation who is or has been violating any state law relating to the practice of medicine. In this model, the MSO contracts with the professional medical corporation (Professional Medical Corporation) so that the Professional Medical Corporation agrees to provide professional services, and the MSO agrees to provide administrative and management services, such as: All of these services are subject to applicable legal requirements (including more specific CPM prohibitions), and rules relevant to billing and collecting, and would require specific contractual provisions between the Professional Medical Corporation and the MSO. clinic, or other medical or dental facility prior to, incident to, and appropriate to the . The "corporate practice of medicine" doctrine arose out of early-20th-century efforts by the American Medical Association to professionalize medicine through the development of an ethical code preventing quackery and the commercial exploitation of physicians. Unlike the corporate practice of medicine, Florida expressly prohibits the corporate practice of optometry. Can there be a parent-subsidiary relationship if the parent does not hold title to the stock of the PSC? Medical Groups, Medical Centers Responding and managing internal complaints or disputes with regard to asserted noncompliance with state laws, such as a complaint made by a terminated physician or other licensed practitioner. Then usually a third set of statutes that deal with who can organize and own a professional corporation. Applicable laws implementing the Corporate Practice and fee-splitting prohibitions vary not only state to state, but professional licensure category to professional licensure category. For example, some applicants use employment and management agreements instead of shareholder control agreements to bind the physician shareholder to the Parent. Privacy, Cybersecurity & Data Asset Management, Physician-Owned Management Services Organizations: Regulatory Compliance, Contract Considerations, Enforcement, Clifford Barnes Featured in Follow the Brand Podcast: Wise Counsel, Sarah Hall, Elena Quattrone Quoted in Conflicting State Laws and Unpredictable Enforcement Await Providers in Post-Roe America, Glenn Prives Featured in Bloomberg Law Wake Up Call: Laterals, Moves, In-House, NJBiz Features Glenn Prives in Health Care Attorney Joins Epstein Becker Green. However, court decisions and Attorney General Opinions have Lets say, for example, compounded skin care creams to treat acne? Chad D. Ehrenkranz. Is Clinical Decision-Making (CDS) Software Expanded or More Legally Ambiguous under the CURES Act? As business opportunities abound for both licensed physicians, dentists and other licensed and non-licensed entrepreneurs and investors in the ownership and operation of medical and dental practices, ambulatory care facilities, drug treatment facilities, diagnostic testing facilities and other types of healthcare facilities, doctors and business individuals and entities must ensure that the structure of their businesses comply with their states Corporate Practice of Medicine (CPOM) doctrine. Medical Management (MSOs) Healthcare Facilities Cosmetics Companies Corporate Practice of Medicine. In some states, you have to read the various rules and figure out what the states position is on corporate practice of medicine. Seeking the advice of knowledgeable and experienced professionals is imperative before taking any such steps. one or more persons licensed pursuant to the medical practice act of 1987, as heretofore or hereafter amended, may form a corporation pursuant to the "business corporation act of 1983", as amended, to own, operate and maintain an establishment for the study, diagnosis and treatment of human ailments and injuries, whether physical or mental, and Official Code of Georgia Annotated, Title 43, Chapters 34 and 34A (O.C.G.A. Our location is real and we are now virtually enabled to assist new long distance clients and out-of-town colleagues. An official website of the State of Georgia. These documents should have established adequate control by the exempt parent. Broadly speaking, the Corporate Practice doctrine provides that a non-licensed person (or company) should not own or control a professional practice (such as a physician or dental practice), while fee-splitting laws prohibit professionals from sharing or dividing their fees with a non-professional in return for a referral of patients or customers. A majority of states restrict the practice of medicine and dentistry by entities that are not owned and controlled by the relevant licensed professionals. In fact, the legislative intent of each of these laws is to authorize only licensed persons to render professional services through these types of entities. (Business & Professions Code 2052 and 2400.). Tenn. Code Ann. Title 32 32-1454, 1455 (authorizing injunction against practice of medicine by one not licensed to practice or not exempt from licensing requirements) A.R.S. Colorado Revised Statutes Title 12. While there often is a Corporate Practice of Medicine exception for hospitals that hire physicians, the AGs rationale in the 1995 opinion, cited above, provides a good statement of the logic behind the weak version of the prohibition against Corporate Practice of Medicine. The corporate practice of medicine doctrine (CPOM) is a complex ruling that can easily result in legal problems if not followed accordingly. Business and Professions Code section 2400, within the Medical Practice Act, provides in pertinent part: Corporations and other artificial entities shall have no professional rights, privileges, or powers.. MSO has no duty to consult with the Professional Medical Corporation/ Practicing Physician, even on an informal basis. Concierge Medical Practices 63-6-204(b). Tenn. Atty. A nuanced approached is best, and that is how our healthcare lawyers roll. Corporate practice of medicine laws prohibit an entity from providing medical services or employing physicians if non-physicians own it. Telemedicine Ventures, Healthcare M&A: Dos and Donts of Buying or Selling a Medical Practice, Californias New Scope of Practice Law for Nurse Practitioners - Part Two, FDA Issues Warning Letter to Company that Sells CBD Products Online and Through Social Media, 5 Key Stark and Anti-Kickback Legal Rules Youll Want to Know. As we said, the prohibition is not necessarily embodied in a statute, but rather, may be expressed in cases, or, perhaps a policy statement by the state medical board. One of the purposes of the CPM doctrine is to separate medical from business decision-making. Foreign specialists may be invited to Georgia for temporary independent medical practice: a) from the countries enlisted in Article 9(3)(a) of this Law; b) in the medical specialties determined by paragraph 2 of this article. These criteria also show the slippery slope and how enforcement in other states can potentially look to find intrusion by the MSO or healthcare venture into the medical doctors domain. The TAC developed a list of those decisions which would affect, directly or indirectly, the practice of medicine and assigned the decision making authority of those decisions to the appropriate party, i.e. What conditions can be referred to another physician specialist, What diagnostic tests are appropriate for a particular condition, What gets included in a particular patients medical records, Whether a particular patient visit requires a particular billing code, Communications of a purely clinical nature with patients, Determination as to whether an emergency medical condition exists, Compensation for allied health and lay staff, Selecting purely administrative staff that do not hold key positions, Non-clinical decisions concerning medical records, Contractual relationships with third-party payors, How much the physician group (including cost of all benefits) should be compensated, Setting the global budget for limited license practitioner compensation, Mergers, acquisitions, conversions and affiliations, Ownership and scope of ancillary ventures, Making a decision to transfer a stable patient, How much the lay entity, including the entitys executive management should be compensated. 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