Spa Reports in the News

New Report Outlines Key Legal Issues for Medical Spas and Aesthetic Medical Practices

A new IAPAM report outlines the legal implications of opening a medical spa. Medical spas require careful attention to the intersection of the corporate practice of medicine, licensing, anti-kickback and fee-splitting considerations, and other legal and regulatory issues. This report summarizes the key legal issues physicians and medical spa owners need to know.

Las Vegas, NV -- March 20, 2008 -- Both physicians who want to either open a medical spa or add aesthetic medical procedures to their existing practice, and entrepreneurs who want to either open a medical spa or incorporate aesthetic medical procedures to a wellness center, can benefit from a better understanding of some of key legal issues involved.

"Many of our members really had no idea about the legal ramifications when setting up a medical spa or expanding with an aesthetic practice," says Jeff Russell, executive-director of the International Association for Physicians in Aesthetic Medicine (IAPAM). It's very important they choose the right legal structure to protect them and their families from legal issues. Equally important is to choose the right attorney, especially one who is experienced in the medical spa and aesthetic industry. "That is why the IAPAM's 2 day Aesthetic Medicine Symposium now includes a legal education section," says Russell.

The medical spa industry is exploding with potential business opportunities. Yet, many physicians and business owners open an aesthetic medical practice or join a medical spa with little awareness of the potential legal and regulatory pitfalls that await the unprepared clinician or entrepreneur "The medical spa industry is exploding with potential business opportunities. Yet, many physicians and business owners open an aesthetic medical practice or join a medical spa with little awareness of the potential legal and regulatory pitfalls that await the unprepared clinician or entrepreneur," says attorney Michael H. Cohen, JD, MBA.

The IAPAM asked attorney Michael H. Cohen of The Law Offices of Michael H. Cohen to give IAPAM members some key points to keep in mind in order to help them navigate the legal issues relating to opening a medical spa or aesthetic practice. Here are the highlights of that report.

Legal Structure for the Business
Many physicians want to know what is the best business structure for a medical spa, or for their own medical practice when they affiliate with a medical spa. This is a complicated question that cannot be answered in a bullet point, as it involves a number of distinct legal issues.

Clinical Practice Structure
Structuring the clinical practice structure for the physician, as well as for the medical spa or other health care institution, requires careful attention to state licensing laws. Most states define the "practice of medicine" in terms such as "diagnosing and treating disease," and make the unlicensed practice of medicine a felony.

Credentialing Health Care Providers
Medical spas and wellness centers face a dilemma when it comes to vetting practitioners. On one hand, if the organization does not ensure that it is hiring the most qualified, competent providers, and a patient is injured while under a practitioner's care within the spa or center, the organization can be considered negligent for failing to exercise due diligence in hiring.

Medical Malpractice (Negligence) and Professional Liability Insurance
The legal definition of medical malpractice (or professional negligence) is: failure to use due care (or follow the standard of care) in treating a patient, and thereby injuring the patient. States vary in their requirements for malpractice coverage, and individual insurers vary in the extent to which they cover aesthetic medical therapies and complementary and alternative medical therapies. Professional liability insurance policies tend to be dense and filled with jargon, making it difficult to determine exactly what is covered and what is excluded.

Informed Consent
A lack of proper informed consent can serve as an alternative theory to medical malpractice. The legal obligation of informed consent is to provide the patient with all the information material to a treatment decision--in other words, that would make a difference in the patient's choice to undergo or forgo a given therapeutic protocol.

Professional Discipline
Professional discipline refers to the power of the relevant professional board--in the physician's case, the state medical board--to sanction a clinician, most significantly by revoking the clinician's license.

Anti-Kickback and Fee-Splitting Considerations
Federal law prohibits physicians from receiving an illegal discount or payment in exchange for referring patients. The prohibited practice, also known as a "volume-based inducement," is codified in the so-called "Stark" and federal anti-kickback laws, and often mirrored in state fee-splitting laws.

You can download the full report, including Michael H. Cohen's tips for key section at http://www.iapam.com/legalguide/. This information has been taken from part of the course curriculum that will be taught at the IAPAM's 2-day Aesthetic Medicine Symposium. You can also find the latest medial spa and aesthetic industry news at http://www.AestheticMedicineNews.com.

For more information and further resources regarding legal issues applicable to aesthetic medical practices and medical spas, visit the Complementary and Alternative Medicine Law Blog.

The materials in this press release have been prepared for informational purposes only and are not legal advice or counsel. The information contained in this release is provided only as general information, which may or may not reflect the most current legal developments. Readers should not act upon any information in this release without seeking professional legal counsel.

About the Law Offices of Michael H. Cohen
The Law Offices of Michael H. Cohen represents physicians, nurses, complementary care providers, medical spas, integrative medicine clinics, holistic health care and wellness centers, and similar organizations that are bridging spa treatments, holistic health and wellness care, and medical (or aesthetic medical, cosmetic, and beauty treatments)

The Law Offices has expertise in legal and regulatory issues including liability risk management, insurance, billing and reimbursement matters, business practice structure, FDA/dietary supplement and medical device regulation, laboratory requirements and medical/health board disciplinary issues. The law firm's principal, Michael H. Cohen, JD, MBA, has worked as a corporate lawyer on Wall Street, has written numerous books and articles on legal issues in complementary and alternative medicine, and has served on the faculty of Harvard Medical School and Harvard School of Public Health. Alan Dumoff, JD, MSW, who serves as Of Counsel to the firm, also has years of experience representing clinicians and clinics particularly in the integrative medicine, medical spa and wellness field. For more information, see the firm's website at http://www.michaelhcohen.com.

About the International Association for Physicians in Aesthetic Medicine (IAPAM)
The International Association for Physicians in Aesthetic Medicine is a voluntary association of physicians and supporters that sets standards for the aesthetic medical profession. The goal of the association is to offer education, ethical standards, credentialing, and member benefits. IAPAM membership is open to licensed medical doctors (MDs) and doctors of osteopathic medicine (DOs). More information about the Symposium can be accessed through http://www.AestheticMedicineSymposium.com.