Sports and Student Physicals: Legal Issues

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By Kim Stanger

It’s that time of year when many healthcare providers offer free or discounted sports or student physicals as a community service or marketing ploy. If you participate in such programs, make sure you consider the legal issues, including the following:

  • Confirm that your malpractice insurance covers such services. Some states have statutes that protect practitioners when providing free medical services at such community events. (See, e.g., Idaho Code § 39-7701 et seq.). If you are relying on such a statute, make sure that you comply with the conditions associated with—and beware the limits to—such protection. For example, these statutes usually do not protect the provider against intentional or grossly negligent conduct. Make sure your malpractice insurance covers any gap.
  • If the student is an unemancipated minor, you likely need effective parental consent for the exam or treatment. Effective consent requires that you provide sufficient information concerning the risks, benefits, and scope of services to ensure the consent is truly informed.
  • Ensure that the student and/or their personal representative understand the limited scope of your services. You may want to have them acknowledge in writing that you are only providing the limited services associated with the program, and that you are not undertaking to provide ongoing or follow-up care unless you expressly agree otherwise.

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Non-Physicians Owning or Investing in Medical Practices in Idaho

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By Kim Stanger

The Idaho Board of Medicine’s recent disavowal of the corporate practice of medicine doctrine has made it easier for corporations and non-physician individuals to invest in or own medical practices in Idaho.

The Corporate Practice of Medicine. For decades, the Idaho Board of Medicine took the position that, with limited exceptions, the Idaho Medical Practice Act “prohibits unlicensed corporations and entities from hiring physicians as employees to provide medical services to patients.” (Memo from J. Uranga to Idaho State Bd. of Medicine dated 2/26/07). This “corporate practice of medicine” doctrine (“CPOM”) had its foundation in a 1952 Idaho Supreme Court case which held that:

[n]o unlicensed person or entity may engage in the practice of the medical profession though licensed employees; nor may a licensed physician practice as an employee of an unlicensed person or entity. Such practices are contrary to public policy.

(Worlton v. Davis, 73 Idaho 217, 221 (1952)). The Board of Medicine warned that violations of the doctrine may result in disciplinary action against physicians and, more recently, physician assistants. Entities that improperly employed physicians or physician assistants risked the possibility of criminal action for the unauthorized practice of medicine. Read more

Liability for Non-Employees: Beware Apparent Authority

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by Kim Stanger

As a general rule, hospitals and other healthcare providers are not liable for the acts of non-employed medical staff members, independent contractors or vendors; instead, each party is responsible for its own actions or those of its employees or agents who are acting within the scope of their employment or agency. However, courts are sometimes willing to hold a hospital or provider vicariously liable for the acts of non-employees under the doctrine of “apparent authority”.

Apparent Authority. In Jones v. Healthsouth Treasure Valley, for example, the Idaho Supreme Court held that a hospital might be liable for the acts of an independent contractor if: (1) the hospital’s conduct would lead a plaintiff to reasonably believe that another person acts on the hospital’s behalf (i.e., the hospital held out that other person as the hospital’s agent); and (2) the plaintiff reasonably believes that the putative agent’s services are rendered on behalf of the hospital (i.e., the plaintiff is justified in believing that the actor is acting as the agent of the hospital). (147 Idaho 109, 206 P.3d 473 (2009)). The Idaho Supreme Court recently reaffirmed the apparent authority theory in Navo v. Bingham Memorial Hospital, 160 Idaho 363, 373 P.3d 681 (2016). Read more

Idaho Board of Medicine Disavows the Corporate Practice of Medicine Doctrine

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By Kim Stanger, Holland & Hart LLP

For decades, the Idaho Board of Medicine took the position that, with limited exceptions, the Idaho Medical Practice Act “prohibits unlicensed corporations and entities from hiring physicians as employees to provide medical services to patients.” Memo from J. Uranga to Idaho State Bd. of Medicine dated 2/26/07. This “corporate practice of medicine doctrine” had its Idaho foundation in a 1952 Idaho Supreme Court case which held that:

[n]o unlicensed person or entity may engage in the practice of the medical profession though licensed employees; nor may a licensed physician practice as an employee of an unlicensed person or entity. Such practices are contrary to public policy.

Worlton v. Davis, 73 Idaho 217, 221 (1952). The Board of Medicine warned that violations of the doctrine may result in disciplinary action against physicians and, more recently, physician assistants. Entities that improperly employed physicians or physician assistants risked the possibility of criminal action for the unauthorized practice of medicine.

Over the years, the corporate practice of medicine doctrine has been criticized as anachronistic and inconsistent with recent legislative action. See, e.g., M. Gustavson and N. Taylor, At Death’s Door—Idaho’s Corporate Practice of Medicine Doctrine, 47 Idaho L. Rev. 480 (2011). Read more

Physician Contract Checklist

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by Kim C. Stanger, Holland & Hart LLP

Regulatory Compliance. If the physician will be performing or referring items or services payable by government healthcare programs, you should generally structure the contract to satisfy applicable safe harbors under the federal Ethics in Patient Referrals Act (“Stark”), 42 CFR 411.355 or 411.357(c), (d) or (l), and the Anti-Kickback Statute (“AKS”), 42 CFR 1001.952(d) or (i). For information concerning those regulatory requirements, see our Client Alert, Stark Requirement for Physician Contracts. In addition, the federal Civil Monetary Penalties Law generally prohibits hospitals from offering inducements to physicians to limit services payable by government programs. (42 USC 1320a-7a(b)(1); 42 CFR 1003.102). 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. If your state recognizes the corporate practice of medicine doctrine, you may need to structure your arrangement to fulfill any unique requirements applicable to your state.

Written Agreement. Stark and AKS safe harbors generally require current written contracts for independent contractors. Although written contracts are not required for the employee safe harbors, it is usually a good idea to document the arrangement to avoid disputes, especially if there are special compensation requirements, employment is other than “at-will”, or you wish to include a restrictive covenant. Read more