Wellness services may pose compliance risk

August 24, 2020

Ensure compliance with state and federal laws before offering wellness services to remedy COVID complications.

There are many ideas about how to best combat COVID. Some proposed solutions are medical, while other focus on “wellness,” which can include IV vitamin infusions, peptide therapy, hormone therapy, infrared saunas, acupuncture, and other non-traditional services. Many people are seeking ways in which to become healthier and better able to fight off viral infection and are willing to try new methods to achieve that goal. It is important to note that the Federal Trade Commission does not allow any promotion of such services as a way to “cure” COVID-19.

In many states, it is important to be aware of the laws on who can offer so-called “wellness services.” The answer to this depends specifically on what services are being offered and state guidance should be carefully reviewed for every single service to be offered. In some states, for example, IV injections require a physician order and supervision because injections puncture the skin. Many laser services have the same oversight requirement. This means that in states where corporate practice of medicine laws apply, non-physician owned “wellness centers” may not be in compliance if they offer such services. Additionally, they cannot simply come into compliance by hiring a medical director for such services. It’s also important to note that many “wellness” services may also require physician presence and oversight, as well as a physician-patient relationship to be established before services are offered. This means that for these types of services, a physician (or delegated other qualified person, depending on the state), must actually do some form of patient intake before services are offered.

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For practices that are looking to offer wellness services to their patients, it’s important to become familiar with supervision and related requirements in order to assure compliance. Usually such services are not covered by insurance so there are fewer legal issues, but in states where fee-splitting is prohibited, practices cannot simply pay a percentage of revenue to “wellness” providers they may bring into the practice to offer services. Moreover, practices should always make sure that any practitioners they do hire have appropriate licenses as may be required under state law.

For physicians who may be asked to become medical directors of “wellness” business or spas, caution is needed. First, be sure the state does not prohibit the corporate practice of medicine if the services are those which must be ordered or overseen by a physician. Be sure not to simply attach your name to a wellness practice without fully understanding the impact it may have on your license and fully explore any professional responsibilities you may have.

Finally, some wellness companies set up a management service organization (MSO) approach, where they manage a practice owned by a physician. Typically, these arrangements are set up to comply with state laws on corporate practice of medicine and fee-splitting and can be legitimately operated. However, physicians need to understand that if they agree to own the professional corporation, they are responsible for all services offered within the entity and any negative patient outcomes. It’s important for a doctor to take the time to understand the services being offered and to develop appropriate policies for oversight of services, review of records and supervision of personnel, as needed. Physician who simply “loan their license” for a paycheck, without any care for operation of the professional entity, may come to regret their involvement.

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Wellness services continue to grow in popularity and can be offered in a variety of different ways. Physicians need to be sure that any involvement they have in offering such services is compliant with both state law and professional responsibility.

About the Author

Ericka L. Adler, JD, LLM has practiced in the area of regulatory and transactional healthcare law for more than 20 years. She represents physicians and other healthcare providers across the country in their day-to-day legal needs, including contract negotiations, sale transactions, and complex joint ventures. She also works with providers on a wide variety of compliance issues such as Stark Law, Anti-Kickback Statute, and HIPAA. Ericka has been writing for Physicians Practice since 2011.