MIEC’s Underwriting and Patient Safety & Risk Management Departments frequently receive questions from policyholders about cosmetic procedures, participation in Medispas, what procedures can be performed by staff, and more. The following are answers to FAQs that we hope will provide physicians with some useful information.
Q. Do I escape responsibility for patients if I, as a physician, simply sign up with a Medispa and lend my name on paper to the facility while receiving a monthly payment to do so?
(California) No! According to the Medical Board of California (MBC), this type of arrangement is a violation of current laws governing the business of medical practices. Violations include, “…violations of the corporate practice prohibitions, as well as fee-splitting and payment for referrals. The illegal business models give rise to the use of unlicensed or inappropriately licensed personnel, paper-only supervision (“rent-a-license”) of allied health professionals, consumer confusion over the medical nature of the procedures, and confusion over who is responsible for the patients. Patients are not fully informed of risks and often do not know the medical nature of the treatments or who is responsible for their care.” (from MBC’s publication The Bottom Line: The Business of Medicine – Medical Spas)
(Idaho) Idaho Code §54-1814(8) states, “Division of fees or gifts or agreement to split or divide fees or gifts received for professional services with any person, institution or corporation in exchange for referral” violates the Medical Practices Act. Further, under Idaho case law, a physician or other person who acts in such a way as to lead a reasonable patient to believe that the he or she is the employer of or responsible for the medical spa personnel may be held vicariously accountable under the theory of ostensible agency.
Alaska and Hawaii laws are silent on the topic.
Q. It’s my understanding that some states prohibit the corporate practice of medicine. What does that mean?
(California) According to California’s Business & Professions Code §2400, laypersons or lay entities may not own any part of a medical practice. Physicians must either own the practice or must be employed or contracted by a physician-owned medical corporation or practice. California licensed physicians must own the majority of the stock in a medical corporation, with no more than 49% owned by other licensed health care professionals including nurse practitioners, nurses, physician assistants, etc. No stock in a medical corporation may be owned by a lay person. [Corporation Code §13401.5(a)].
(Idaho) Idaho’s common law prohibits the corporate practice of medicine. However, according to Steven J. Hippler, Esq., from Givens Pursley LLP, licensed hospitals, hospital districts, health maintenance organizations and captive professional corporations are exempt from the corporate practice of medicine prohibition. The Idaho Supreme Court stated in Worlton v. Davis, 73 Idaho 217 (1952), “It is well established that no unlicensed person or entity may engage in the practice of medical profession through licensed employees; nor may a licensed physician practice as an employee of an unlicensed person or entity. Such practices are contrary to public policy.” [73 Idaho at 221]
It is the position of the Idaho State Board of Medicine that. “… non-physician businesses and individuals may not hire physicians as employees to operate clinics for those entities or individuals. Physicians who accept employment from unlicensed businesses and individuals risk disciplinary action by the Board. Similarly, physicians who allow unlicensed businesses or individuals to bill for services provided by unlicensed, lay people also risk disciplinary action…” (Steven J. Hippler, Esq., Summary of Fraud and Abuse Statutes & Regulations Idaho, October 27, 2008)
(Hawaii) According to Kevin H. Kaneshiro, Esq. from the law firm of O’Connor Playdon & Guben LLP, “Although Hawaii does not have a statute that specifically applies to the corporate practice of medicine, Hawaii Revised Statutes (“HRS”) Chapter 415A, Hawaii’s Professional Corporation Act, applies to any professional corporation which would include a corporation that practices medicine or provides medical services…a professional corporation can only provide professional services that it is authorized to provide under its articles of incorporation through an individual who is licensed to provide the professional services of the corporation. In other words, a medical corporation can only provide medical services through individuals who are licensed to practice medicine in Hawaii.”
“Moreover, regarding the ownership of a professional corporation, HRS Chapter 415A provides…all shareholders of a professional corporation must be authorized by law, i.e., licensed, to render the professional services of the corporation. Furthermore, at least a half of the directors of the corporation and all officers other than the secretary and treasurer, i.e., the president and vice-presidents, must be ‘qualified persons’ who are defined as individuals who are ‘eligible under this chapter to own shares issued by a professional corporation,’ (HRS §415A-2); in other words, individuals who are licensed to render the professional services. Consequently, non-licensed individuals cannot own any shares in a medical professional corporation nor can they comprise a majority of the directors or serve as officers other than as secretary or treasurer.”
“On a somewhat related note, HRS §453-8(a) provides that ‘[i]n addition to any other actions authorized by law, any license to practice medicine and surgery may be revoked, limited, or suspended by the Board at any time in a proceeding before the board, and may be denied, for any cause authorized by law, including but not limited to the following: …(9) Conduct or practice contrary to recognized standards of ethics of the medical profession as adopted by the Hawaii Medical Association, the American Medical Association[.]’ Opinion 3.05 of the AMA Code of Ethics provides, in part, as follows:
‘…When nonphysicians employ physicians to supervise the employer’s clinical practice, conditions are created that can lead to ethical dilemmas for the physician. If maintaining an employment relationship with a midlevel practitioner contributes significantly to the physician’s livelihood, a physician’s personal and financial interests can be put at odds with patient care interests. Similarly, the administrative and financial influence that employer status confers creates an inherent conflict for a physician who is simultaneously an employee and a clinical supervisor of his or her employer.
Physicians in such arrangements must give precedence to their ethical obligation to act in the patient’s best interest by always exercising independent professional judgment, even if that puts the physician at odds with the employer/supervisee.’”
“Although Opinion 3.05 does not specifically prohibit the employment of a physician by a nonphysician, it does caution a physician in such circumstances about the conflict between the interests of the nonphysician employer and the patient. Thus, even if a physician is permitted to be employed by a nonphysician to provide medical services to patients, the physician cannot be controlled by the nonphysician employer in the physician’s exercise of independent professional judgment. To do so may be contrary to an AMA Standard of Ethics which in turn would be a violation of HRS §485-8(a)(9).”
Alaska state laws do not speak to the corporate practice of medicine.
Q. Laser treatments, Botox, and cosmetic filler injections are only cosmetic treatments, right?
(California) Wrong! According to the MBC, they are medical treatments. “The use of prescriptive drugs and devices…is the practice of medicine, and the same laws and regulations apply to these types of treatments as those driven by medical necessity. There are no separate laws governing these procedures, and physicians will be held to the same standard as they are for their routine medical practices. This means that the standards for informed consent, delegation to allied health professionals, physician-patient confidentiality and boundaries, maintaining medical records, as well as responsibility and liability apply to physicians, even those denominated “medical directors.”
(Alaska) In 2004 and 2007 respectively, the Alaska State Medical Board adopted the American Medical Association’s policies on laser surgery and the American College of Surgeons statement on surgery using lasers, pulsed light, radiofrequency devices or other techniques. Techniques are defined as ablative (i.e., expected to excise, burn or vaporize the skin below the dermo-epidermal junction) or non-ablative (i.e., not expected or intended to excise, burn or vaporize the epidermal surface of the skin). The American College of Surgeons believes “…that surgery using lasers, pulsed light, radio frequency devices or other means is the practice of medicine and constitutes standard forms of surgical intervention.”
According to Keith E. Brown, Esq., of Brown, Waller & Gibbs in Anchorage, Alaska, “Although not directly addressed by statute or regulation in the context of Medispas, it can be assumed that given the broad definition of the practice of medicine in Alaska, physicians will be held to the same standards regarding informed consent, maintaining medical records, and patient confidentiality (HIPAA compliance must be assured), as well as the usual requirements relating to delegation to other health care professionals. For example, Alaska has addressed delegation as authorized by AS 08.68.805 of routine nursing duties, specialized nursing duties, the administration of medication (12 AAC 44.965), the administration of injectable medication (12 AAC 44.966) (which can only be delegated by an ANP to a certified medical assistant in limited circumstances). Whistleblower protection is afforded nurses who report improper delegation of nursing functions (AS 08.16.279). The physician operating, supervising or staffing a Medispa will likely have the same vicarious responsibility that a physician would have in the operation of any clinic.”
Q. I’m accustomed to delegating responsibilities to my allied health professionals. To whom may I delegate the utilization of lasers and other prescriptive devices and drugs?
(California) Be careful! A physician can delegate laser treatments, Botox and cosmetic fillers to licensed registered nurses, nurse practitioners or physician assistants who the physician knows to be capable of performing the task. The physician should also be proficient in performing the treatment. Supervisory requirements vary by the licensure of the allied health professional.
Registered nurses: Standardized procedure guidelines allow nurses to perform the laser treatments and injections while the physician is not physically present; however, the guidelines do not take the place of the physician’s supervisory responsibilities, which include: ensuring and documenting the nurse’s experience, training and education requirements, as well as initially and continually evaluating the nurse’s competence.
Please note: It is the responsibility of the physician to conduct a patient examination before delegating the task to a registered nurse. Also, according to the MBC, supervising physicians must be within “a geographical distance that enables them to effectively provide supervision and support when needed or upon request.”
According the MBC, licensed vocational nurses, cosmetologists, electrologists, or estheticians may not legally perform treatments using lasers or intense pulse light devices. Electrologists remove or destroy hair using an electronic needle only (Business & Professions Code §7316); therefore, it is outside the scope of their practice to use a laser. Likewise, cosmetologists or estheticians, while licensed professionals and highly qualified in superficial treatments such as facials and microdermabrasion, may never inject the skin, use lasers, or perform medical-level (i.e., deeper levels of epidermis) dermabrasion or skin peels. Unlicensed personnel, including medical assistants, are not allowed to perform any type of microdermabrasion or laser treatments.
For more information in California, go to: http://www.mbc.ca.gov/allied/medical_assistants_lasers.html
(Alaska) Alaska physicians may delegate the use of ablative lasers to nurse practitioners and physician assistants who are trained and licensed to practice medicine in the state of Alaska; the treatments should fall within the statutory and/or regulatory scope of the practitioner’s profession. Delegation of the ablative treatments must be through the use of written protocols. Physicians should provide direct supervision when he/she has delegated the procedure to a midlevel. Physicians are responsible for performing initial reviews of the patients and authorizing treatment plans, and documenting examinations in the patients’ charts prior to the first treatment.
According to the American College of Surgeons’ guidelines, in those cases where a surgeon may utilize the services of a “non-physician advanced health practitioner or non-physician health practitioner” as an assistant during the performance of an ablative or non-ablative laser surgery, the assistant must be properly licensed, certified and/or credentialed to practice his/her profession; must have appropriate education and training for assisting the surgeon in the laser surgery; and complete assigned duties under the direct supervision of the surgeon performing the procedure.
Physicians may delegate non-ablative procedures to registered nurses, cosmetologists, estheticians and medical assistants or other qualified personnel. Procedures must be performed under the direct supervision by the physician. Non-physician practitioners must be appropriately trained, licensed within the state, practicing within the scope of their practice and be provided with written protocols. As with ablative procedures, a physician must conduct the initial evaluation, determine the non-ablative treatment plan and document the encounter.
Please note: According to the Alaska Licensing Examiner’s office, aestheticians cannot go below the dermal layer, cannot use hot lasers and may not provide injections. According to Alaska Statute 08.13.220 (5) and (8), esthetics is defined and limited to, “…the use of the hands, appliances, cosmetic preparations, antiseptics, or lotions in massaging, cleansing, stimulating, or similar work on the scalp, face or neck, including skin care, make-up, and temporary removal of superfluous hair, for cosmetic purposes for a fee…”
Please note: According to Keith E. Brown, Esq., he does not believe that the American College of Surgeon’s guidelines can be construed as limiting the role of nurse practitioners in the Medispa setting. The collaboration requirement set for in 12 AAC 44.410 was repealed in 1984. Nurse practitioners practice independently within the practice areas set forth in 12 AAC 44.380 which include acute/care emergency medicine; adult care; family, geriatric, neonatal, and pediatric care; women’s health; and, family and adult psychiatric mental health.
Q. What are the Idaho rules governing physicians and staff who provide cosmetic treatments?
To best answer this question, we will outline Idaho’s administrative rules that went into effect in March 2007. Policyholders can find the rules in the Idaho Administrative Code IDAPA 22.01.04 – Rules of the Board of Medicine for Registration of Supervising and Directing Physicians.
The scope of the rules governs the activities of, “physicians and osteopathic physicians licensed in Idaho…who supervise the provision of cosmetic treatments using prescriptive medical/cosmetic devices and products by medical personnel” [Subsection 001.02.].
By definition, “medical personnel” are individuals who exclusively provide non-incisive and non-ablative cosmetic treatments using prescriptive medical/cosmetic devices and products under the direction and supervision of a supervising physician registered with the Medical Board. The supervising physician cannot supervise more than a total of three (3) such medical personnel at once; however, the Board may authorize the supervising physician to supervise a total of six (6) medical personnel contemporaneously “if necessary to provide adequate cosmetic treatments and upon prior petition documenting adequate safeguards to protect the public health and safety” [Subsection 010.11 and 17.].
Of note: According the Idaho Board of Medicine, the chapter does not authorize the practice of medicine by a person not licensed by the Board. However, medical personnel referenced in this administrative rule include nurses, medical assistants, or any non-licensed personnel that a supervising physician has trained to perform non-incisive and non-ablative cosmetic treatments.
Prescriptive medical/cosmetic devices are federal FDA approved prescriptive devices that use waveform energy including, but not limited to, intense pulsed light (IPL) or lasers, to cosmetically alter human tissue. A prescriptive medical/cosmetic product is an FDA-approved prescriptive product whose primary intended use is achieved through chemical action and which cosmetically alters human tissue with filler substances such as collagen or fat, lipo transfer, muscle immobilizers or sclerosing agents [Subsection.023.01, paragraphs d. and e.]
According to Idaho rules, a supervising physician’s duties and responsibilities for medical personnel who perform cosmetic treatments include:
- Accept full responsibility for the cosmetic treatments provided by medical personnel using prescription medical/cosmetic devices and products.
- Be trained in the safety and use of the cosmetic devices and products.
- Document his/her evaluation and assessment of the patient prior to commencement of a cosmetic treatment. An adequate record must contain, at a minimum, subjective information, an evaluation and report of objective findings, assessment or diagnosis, and the plan of care including, but not limited to, a prescription of the cosmetic devices and products.
- Be available on-site or immediately while medical personnel perform cosmetic treatments in order to promptly respond to any questions or problems that may occur. Supervision includes periodic review of the medical records to evaluate the cosmetic treatments including any adverse outcomes or changes in treatment protocols and regularly scheduled conferences between the supervising physician and medical personnel.
- Ensure that cosmetic treatments using prescription medical/cosmetic devices and products are limited to and consistent with the supervising physician’s scope of practice.
- Ensure that the medical personnel are not independently providing cosmetic treatments using cosmetic devices and products.
- Ensure that the medical personnel possess the proper training in cutaneous medicine, indications for the prescribed treatment, and the pre- and post-treatment care for each procedure performed. The supervising physician must certify training on each device or product the medical personnel will use include:
- Physics and safety of the prescriptive medical/cosmetic devices and products;
- Basic principle of the planned procedure and treatment;
- Clinical application of the cosmetic devices and products including, but not limited to, wavelengths to be used with intense pulse light/lasers;
- Indications and contraindications for the use of the devices and products;
- Pre-and post-procedure care;
- Recognition and acute management of complications that may result from a treatment or procedure; and,
- Infectious disease control procedures required for each treatment.
- Assure compliance with the medical personnel training and reporting requirements outlined by the rule.
- Submit a “Certification of Training” form provided by the Idaho Board of Medicine to the Board for approval before medical personnel may perform cosmetic treatments using prescriptive medical/cosmetic devices and products. The Board may require the supervising physician to provide additional information (e.g., physician’s affidavit attesting to the medical personnel’s qualifications and clinical abilities to perform the cosmetic treatments). The Certification of Training must be sent to the Board and a copy must be on file at each practice location and at the address of record of the supervising physician.
- Prepare a written protocol for medical personnel to follow when using the cosmetic devices and products. The supervising physician must ensure that the medical personnel use prescriptive medical/cosmetic devices and products in accordance with the written protocols and do not exercise independent judgment when using the devices and products.
- Disclose to patients receiving cosmetic treatments that medical personnel are not licensed physicians. Disclosure requirement can be fulfilled using name tags, correspondence, oral statements, office signs, or other procedures that “under the involved circumstances adequately advise the patient of the education and training of the medical personnel rendering such cosmetic treatments.”
- Report to the Board of Medicine all patient complaints received against medical personnel related to the quality and nature of cosmetic treatments rendered [Subsections 023.02, paragraphs a. through h.].
According to the Idaho State Board of Medicine’s Guidelines for Hair Removal using Intense Pulsed Light and/or Laser Devices by Supervised Medical Personnel, a licensed Idaho physician must prescribe the use of an IPL and/or laser prescriptive device to cosmetically alter human tissue. Properly trained medical personnel may perform the actual hair removal treatment using IPL and/or laser.
Q. What are the Hawaii laws or rules governing physicians and staff providing cosmetic treatments?
According to the Hawaii Board of Medical Examiners, both physicians and physician assistants can perform laser hair removal, intense pulse light treatments, Botox injections, chemical peels, and filler injections. They are governed by Hawaii Revised Statutes Chapter 453 and Hawaii Administrative Rules, Title 16, Chapter 85.
According to the Executive Officer of Hawaii’s Board of Barbering and Cosmetology, cosmetologists and estheticians may not perform hair removal using lasers or intense pulse devices. They cannot inject collagen, Botox or cosmetic fillers and they can only apply chemical peels if the procedure does not extend below the surface of the skin.
Cosmetologists are defined as hairdressers, estheticians, or nail technicians who are compensated for their services. HRS 439-1 defines an esthetician as a person who, “with hands or nonmedically prescribed mechanical or electrical apparatus or devices or by use of cosmetic preparations, antiseptics, tonics, lotions, or creams, engages for compensation” in: massaging, cleansing, stimulating, manipulating, exercising, beautifying the scalp, face, neck hands, arms, bust, upper part of the body, legs, or feet; cleansing, exfoliating, wrapping, or doing similar work upon the entire body without direct contact by the hands and utilizing gloves, loofah mitts, or brushes; or removing superfluous hair about the body of any person by means other than electrolysis.”
Finally, according to Hawaii’s Board of Nursing, “The Board of Nursing (“Board”) previously determined that performing laser treatments was not a nursing task, whether supervised by a physician or not.”