georgia corporate practice of medicine

do not allow lay controlled corporations to employ physicians to provide medical services 3, but. 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. Negotiating, or assisting other counsel in negotiating, with lenders and insurance providers concerned about state law and/or corporate practice of medicine compliance. Official Code of Georgia Annotated, Title 43, Chapters 34 and 34A (O.C.G.A. M&A (Acquisitions & Sales of Healthcare Businesses), Fraud & Abuse (Anti-Kickback, Fee-Splitting, Stark), Management Services Organizations (MSO) Issues, Medical Device & Mobile Medical App Issues, ANTI-AGING & FUNCTIONAL MEDICINE PRACTICES, BEHAVIORAL & MENTAL HEALTHCARE PROVIDERS AND LIFE COACHES, COMPLEMENTARY & INTEGRATIVE MEDICINE PROVIDERS, CONCIERGE & DIRECT PRIMARY CARE MEDICAL PRACTICES, DIETARY SUPPLEMENT & NUTRACEUTICAL COMPANIES, HEALTHCARE FACILITIES (HOSPITALS, LABS, DME, IMAGING), QUICK SUMMARY OF FEDERAL STARK SELF-REFERRAL & ANTI-KICKBACK LAW AND CALIFORNIA SELF-REFERRAL AND FEE-SPLITTING PROHIBITIONS, HOW SUBSTANCE ABUSE TREATMENT CENTERS NAVIGATE ANTI-KICKBACK RULES. In the state of California the Moscone-Knox Professional Corporation Act states that the majority of the shareholders must be licensed. Ask the Parent of the applicant to provide the following written representations: The Parent's SCA with the physician shareholder is enforceable at law and in equity., The Parent will not suffer or permit the physician shareholder (together with all successors, heirs and assigns of the physician shareholder and all subsequent designees holding the corporation's stock) to financially benefit in any manner, directly or indirectly, from the physician shareholder's legal ownership of the stock of the corporation as the designee and fiduciary of the Parent., The Parent will expeditiously and vigorously enforce all its rights in the shareholder control agreement and will pursue all legal and equitable remedies to protect its interest in the assets and stock of the corporation., Carefully review all organizational documents. While California law does allow a percentage of gross revenues under certain conditions, generally, percentages raise enforcement issues. These may include favorable income tax treatment and immunity from certain types of liability. However, two more recent cases applying Pennsylvania law (albeit by non-Pennsylvania courts), further caution about the structure of these private equity (or other non-licensed entities or people) and medical and dental arrangements. Miami, Partner | It cannot offer physical therapy services, speech services or any other professional services. For example, a hypothetical Professional Medical Corporation named Occupational Therapists For Everyone a Professional Medical Corporation may only provide occupational therapy services. If state licensing laws do not permit the Parent to appoint the PSCs board, the PSC may nevertheless qualify for exemption if, by some combination of mechanisms, the Parent indirectly controls the PSCs board. Because of the limitations of the weak Corporate Practice of Medicine model, for some healthcare ventures, it makes sense to use one modelbased on the strong version of Corporate Practice of Medicineacross states. Neither Party May Solely Make Ultimate Decision Both the Professional Medical Corporation/ Practicing Physician and the MSO must agree when making a decision. States with a weak Corporate Practice of Medicine prohibition potentially might allow such companies to hire physicians to provide medical services, so long as the contract clarifies that the company cannot interfere with clinical decision-making. In OCA, Inc. v. Hodges, 615 F. Supp. To get to the prohibition against the corporate practice of medicine (or Corporate Practice of Medicine), you have to put these three sources together. COPM is an antiquated doctrine that has no sound basis in public policy, no firm basis in Idaho law, and has been widely . 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. 2. There are usually exceptions to the corporate practice of medicine prohibitionnotably, for example, the case of hospitals. Before sharing sensitive or personal information, make sure youre on an official state website. Contact us online or call us today for more information on how the CPOM Doctrine impacts your existing or emerging practice. 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)). Other state regulations also determine the composition of ownership in medical organizations such as medical spas. The corporate practice of medicine doctrine is a medical practice act aimed at protecting patients from deceptive behavior that might come with the private ownership of medical corporations by non-licensed individuals including: The commercialization of the practice of medicine The imbalance between patient obligations and stakeholder obligations Interference of a physicians medical judgment due to outside influences. Pennsylvania also permits health maintenance organizations (HMOs) and licensed hospitals and health care facilities to employ physicians and provide health care services. Strong v. Weak Corporate Practice of Medicine States. in your telemedicine venture? Official Code of Georgia Annotated, Title 43, Chapters 34 and 34A (O.C.G.A. Colorado Revised Statutes Title 12. 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. Contact our healthcare law and FDA attorneys for legal advice relevant to your healthcare venture. Dietary Supplement Companies Because of the CPM doctrine, non-physician in California cannot owna medicalclinic or hire physicians. 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. 2023 Fenton Law Group, LLP.All rights reserved. The court examined whether the PLLC "engages in any business other than the practice of medicine," and found that it did not.11 Physical therapists are licensed, and the practice of physical therapy falls within the "practice of medicine." The arrangement did not violate the doctrine. The court held that the . Similarly, in Allstate Insurance Company vs. Northfield Medical Center, P.C., 228 N.J. 596, 159 A.3d 412 (2017), the New Jersey Supreme Court affirmed a trial courts conclusion that a New York lawyer and a California chiropractor violated the states Insurance Fraud Prevention Act (IFPA) because they promoted and assisted in the creation of a practice structure that was designed to circumvent regulatory requirements with respect to control, ownership and direction of a medical practice.. violations of the corporate practice doctrine are based on a case-by-case evaluation of control and dominion in the corporate-physician relationship at lay control of medical judgment and lay exploitation of the practice of medicine, non-physician corporations may provide medical services through employed physicians. Phone: (404) 685-1662 - Medical Practice Formation :: Atlanta Medical Practice Formation Attorney Georgia and grant the right to temporary independent medical practice to them. Vasilios J. While there can be an overlap in goals, the CPOM doctrine seeks to protect patients from a practices ulterior motives by preventing non-medical practitioners from owning a medical practice. An official website of the State of Georgia. Republish Medicare/Medi-Cal Audits, Appeals and Overpayment Disputes, Moscone-Knox Professional Corporation Act, majority of the shareholders must be licensed. The corporate practice of medicine doctrine (CPOM) is a complex ruling that can easily result in legal problems if not followed accordingly. 1 Several states restrict the practice of medicine by lay controlled corporations. Business Law and Corporate Practice of Medicine . Practitioners and other medical personnel should always consult a healthcare attorney when a legal question or concern arises for advice on how to proceed. Please enable javascript. However, the MSOs services must not interfere with the professionals medical (clinical) judgment or otherwise result in MSO control over the medical aspects of the medical practice. The organizational test requires that a PSC include "organizational language" in an organization's articles of incorporation limiting its purposes to one or more exempt purposes, not expressly empowering it to engage in activities which are not in furtherance of one or more exempt purposes (other than as an insubstantial part of its activities), ensuring that its assets are dedicated to one or more exempt purposes on dissolution, etc. is a senior associate at Lamb McErlane PC who focuses on health law and health care litigation. Corporate Practice of Medicine Allstate Insurance Company vs. Northfield Medical Center The New Jersey High Court unanimously reinstated an insurance company's fraud claims and $4 million dollar verdict against a management company, its owner the their attorney for knowingly violating the Corporate Practice laws. Exclusive Decisions vested in the MSO has sole responsibility for the decision. In general, a Professional Medical Corporation may only provide services in its field. For example, in Georgia: All this suggests that Georgia has a strong prohibition against Corporate Practice of Medicineat least for the moment, as these legal rules can be in flux. Manager approves the expenditures of the PSC. Corporate Practice of Medicine: A 50 State Survey. Concierge Medical Practices Title 12. For instance, not only is the regulation of physician different from state to state, but the regulation of physicians and dentists, for instance, can be very different even within the same state. What if every substance abuse patient is supposed to get a session with a behavioral healthcare professional, followed by a visit to the psych nurse for medication is the substance abuse center, which is owned by non-MDs, intruding into clinical practice by, in effect, setting the clinical pathway? 2 Note, lay controlled corporations as used in this document refers to organizations controlled by laypersons, as distinguished from corporations run by physicians. Cases can be interpreted as limited to its facts, or otherwise legally ambiguous; so much depends on the overall situation and what harms the State perceives in the arrangement and immediate facts, and, there is always enforcement discretion. While medical practice allows nurses to perform certain procedures, that doesn't mean a doctor can be relieved of their responsibilities. And in California, there is a relatively new exception for incidental medical services provided by substance abuse treatment centers. What is the corporate practice of medicine? In the strong form of Corporate Practice of Medicine, there is a typically a violation, whether the physicians are hired as employees or independent contractors, to provide medical services. 2010 Georgia Code TITLE 43 - PROFESSIONS AND BUSINESSES CHAPTER 11 - DENTISTS, DENTAL HYGIENISTS, AND DENTAL ASSISTANTS . 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. Search Georgia Code. A majority of states restrict the practice of medicine and dentistry by entities that are not owned and controlled by the relevant licensed professionals. How Can a Multi-Disciplinary Health & Wellness Platform Handle Legal Risks? All rights reserved. 776-77 (Tenn. 2000) (corporate practice of medicine doctrine applies in Tennessee); 94-009 Op. The corporate name must end with the word "chartered" or "limited" or the abbreviation "Ltd." or with the words "Professional Corporation" or "Prof. Corp." or "P.C." PLLCs are allowed in Illinois so long as all members and managers are licensed for the same profession, including the practice of: Dentistry; Medicine . 610-701-4402. https://cohenhealthcarelaw.com/michaelhcohen/wp-content/uploads/2022/08/cohen-healthcare-horizontal-2020_v2.webp, Cohen Healthcare Law Group | Healthcare Lawyers | FDA & FTC Law, https://cohenhealthcarelaw.com/michaelhcohen/wp-content/uploads/2014/12/bigstock-doctor-meeting-teamwork-diagno-108851294.png. As we noted, whenever you find Corporate Practice of Medicine concerns, youre likely to also find state law prohibitions against fee-splitting, kickbacks, conflict of interest, patient exploitation, and so on. Digital & Mobile Health Companies 178 (1938), which has not been overruled or modified in the 82 years since the original holding. The prohibition on the corporate practice of medicine is grounded in public policy concerns based on the principle that when a lay corporation holds a financial interest in a physician's profits, the entity has a direct interest in and ability to control medical decision-making and impact the quality of care provided to patients. The statutes require that all of the ultimate beneficial owners of these entities be licensed persons. This is not something that should be undertaken casually. The Parent can control the shareholder through an. The legal principle that undergirds both Tenn. Code Ann. For health care investors considering a venture in a health care service that requires professional licensure, consulting with an attorney broadly experienced in the web of state-specific laws and regulations can help ensure efficient platform structuring and enterprise compliance and avoid criminal liability. E.g. WE PROVIDE LEGAL STRATEGY & REGULATORY ADVICE TO BUSINESSES THAT ACCELERATE HEALTH AND WELLNESS, Addiction Treatment Centers Carefully review the state law when performing a field examination of an entity that is engaged in 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. Of hospitals and/or corporate practice of medicine doctrine ( CPOM ) is a new... Practice of medicine by lay controlled corporations to employ physicians and provide health care facilities to employ physicians to medical! These may include favorable income tax treatment and immunity from certain types of liability certain conditions, generally percentages. Medical spas exception for incidental medical services 3, but in general, a Professional medical Corporation Occupational... 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