Posted By Administration,
Wednesday, June 27, 2018
By: Alex R. Thiersch, JD, Founder/Director of the American Med Spa Association (AmSpa)
It’s not uncommon for med spas and other aesthetic practices to use Groupon or other online deal marketplaces. Typically, medical spas use these websites to present special discounts to users in their community, but there are several issues to consider before using these services to try and attract new patients.
On the surface, this seems like a low-risk way for a medical spa to present its offerings to a new group of customers, and medical spa deals represent a significant source of income for the deal websites. However, medical spa owners and operators need to know about a few issues related to discount marketplaces before they choose to use these sites to promote their businesses.
Your average Groupon customer is searching for a cheaper option—that’s the whole point. Patients searching for discounts are probably not going to be as loyal as patients who have taken the time to search for a quality experience. Also, the greater the discount, the less likely it is that the patient will return. Generally speaking, very few people who are directed to medical spas via sites such as Groupon become regulars—most are simply in it for the deals.
This is problematic because most successful medical spas rely on patient retention. In fact, in an average med spa up to 70% of patients are repeat clients according to AmSpa’s 2017 Medical Spa State of the Industry Report. Not only is it over 5 times more expensive to attract new clients than it is to retain current ones, but existing customers tend to spend up to 67% more than new ones, according to an Inc. Magazine study.
Medical spas that partner with Groupon and other deal sites tend to get into what we used to call the “Groupon cycle,” where medical aesthetics practices offer a deal on Groupon not because they actually want to do it, but rather because they just want to get some money in the door. And yes, it is a good way to get some fast cash, but it doesn’t create repeat business, so after a month or two these practices have to do it again just to get some money in the door.
While the idea of having this cash on-hand is appealing, constantly cutting into your margin for clients that are unlikely to return to pay full price is not a sustainable model for success. If you’re selling a lot of treatments on sites such as Groupon, you could run into a cash-flow problem—if your practice is doing most of its business giving extremely large discounts to patients who probably won’t return, you could end up losing a lot of money.
Eventually, medical spas like this operate more or less exclusively on deal sites, and they tend to get bad reputations because their customers, who have expectations that rarely are based in reality, are always complaining about them.
Over the past three or four years, five lawsuits involving laser burns have come across my desk, and in every one of those instances the patient had come from Groupon. The correlation is that patients who are searching for discounts are going to be more likely to cause problems than patients who find your practice via more traditional means.
Additionally, a successful offering on a deal site can lead to an influx of clients, which can cause a med spa to become extremely busy and tax its resources. If a facility does not have a staff of the requisite size and with the proper skills to deal with such a situation, the quality of patient care can suffer—not only for those who purchased the deal, but also for the spa’s regulars.
In most states, laws require medical facilities—including medical spas—to be owned by physicians or physician-owned corporations. And in most of these states, all payments for medical services must be made in full to the owner of the facility. If a percentage of such a payment goes to someone else, the facility has engaged in an illegal practice known as fee-splitting. The use of deal sites to sell medical treatments is, from a legal standpoint, a textbook example of fee-splitting, since the site gets a percentage of the proceeds generated by the sale of the voucher. However some states, like Illinois, have carved out fee-splitting exceptions for deal sites. Check your state’s medical aesthetic legal summary to see how your state approaches fee-splitting.
In the many years that medical spas have been working with sites such as Groupon, there has yet to be any prosecutions for this, and it seems somewhat unlikely that a regulatory agency would start now. It is worth keeping in mind, though, especially if a patient experiences a bad outcome.
If you want to create sustainable success, pass on Groupon and other deal sites and work on creating lasting relationships with reliable clients. Short-term cash isn’t worth the headaches a Groupon offering can bring. For more information on how to build and run a successful, profitable, and legally compliant medical spa attend one of AmSpa’s Medical Spa & Aesthetic Boot Camps.
Posted By Administrator,
Tuesday, June 26, 2018
Updated: Tuesday, June 26, 2018
Sciton is a Silicon Valley-Based Laser Company that proudly celebrated a big anniversary last year. 2017 marks the 20th year for this innovative powerhouse and their team of award winning physicists and engineers. Over the last two decades Sciton has established a well-earned reputation for creating skin technology that has steadily built a very loyal customer base thrilled with the company’s focus on science and achieving results that matter.
Sciton, Inc., situated in Palo Alto, is a privately owned medical device company established in 1997 by cofounders Jim Hobart, Ph.D., and Daniel Negus, Ph.D., who met while they were working at Coherent. As Dr Negus explained, "Our mission from the very beginning was to provide advanced laser and light sources to medical professionals worldwide that are technical and performance leaders, offering unparalleled results and consistent reproducibility." They also set out to give physicians the highest possible value in terms of reliability and durability, and solve real problems to improve the human condition. Sciton’s raison d’etre is actually pretty simple. As Dr Hobart says, "Dan and I formed a company to make things to sell that would delight physicians and patients.”
That fundamental commitment to their customers' success has not been limited to the performance of their systems either. Sciton also enjoys a reputation for offering comprehensive clinical training and practice marketing programs to provide practitioners with the building blocks they need to be successful and enhance their bottom line. They have broken through the hype that often characterizes the cosmetic laser industry to set up Sciton as a science-driven and customer centric company that can and always will put customers' needs first. Today, Sciton’s legacy centers around their passion for skin and advancing best in class skin revitalization technologies that stand the test of time and do not artificially degrade through planned obsolescence. This commitment has set the company up to thrive in a modern era of big pharma consolidation where innovation and customer focused need take a back seat to Wall Street profit-first mentality.
Men on a mission
Today Sciton operates worldwide in more than 45 countries and has launched 26 major innovations since their inception, but the culture of Sciton hasn’t really changed that much in two decades although the industry surely has. The science of how lasers and light interact with tissue is generally where the Sciton scientists and engineers start, as opposed to what sometimes is a more market-driven opportunity lacking rigorous underpinning.
"For example, we’ve seen the tremendous growth in non-invasive body contouring, so we considered whether we should enter this market. Our approach is never going to be that we have something, we’re not sure it works, but let’s get it out there and make some money," says Hobart.
In fact, he admits that it can slow down their growth by taking the time to make sure it works instead of putting something on the market just because it’s hot and everyone is clamoring for it, without making sure it’s based on real science and will produce consistent results that physicians (and patients) will love.
"We would rather spend the time to get it 100% right so customers are thrilled or decide we don’t have a product worth launching yet," he says.
A ton of science without the hype
Lacee Naik, Director of Marketing and Public Relations, explains the guiding principle behind everything they do. "Like Apple, HP, and other iconic Silicon Valley brands, Sciton has stayed true to its original brand promise for two decades and counting. Everything they do is based on the motto “Because Results Matter”. Even the name Sciton is derived from the phrase, “science of photons”.
"I wasn’t keenly aware of shiny new toys because when I was CEO of Coherent, the products kind of sold themselves. The scientists could figure out which was a superior product. But in aesthetic medicine, it’s often all about hype and quasi-science," Dr Hobart says.
He often looks at other technologies and is appalled, in his words. "It’s almost like physicians are being duped by all the buzz and hype. When it gets down to it, they often feel like they’ve been oversold. The shiny new toy they just bought doesn’t really have the guts inside to perform as they were led to believe it would."
“Our handbook says “do the right thing,” and that’s the basis for what every employee at Sciton does," says Dr Negus.
“We believe that we build products that physicians will buy and feel good about. Our products are reputable and long-lasting, and deliver the results that patients deserve and want and that they are willing to pay for," says Dr Hobart. "At a recent meeting, a physician commented to us that while all their other lasers seemed to always break down, their Sciton has continued to chug along for many years. We see that as providing value to our physicians.
In a crowded device market with so many new brands and companies entering rapidly, Sciton’s unique value proposition for doctors stands out. According to Boca Raton plastic surgeon Jason Pozner, MD, "You can buy cheaper but you can’t buy a better quality, long-term device for your practice. My OR Sciton laser was built in 2001 and has been upgraded a few times, but you can’t name one other technology with a better return on investment. Sciton builds smart products for smart doctors and staff. Their devices can be used by beginners and pros, and there is the ability to grow into your system and upgrade as new things come out.”
The Joule in the crown
Their flagship JOULE™ system exemplifies the Sciton approach to producing high-quality, expandable platforms that can perform a range of non-invasive and minimally invasive procedures that doctors want. The JOULE platform allows physicians to customize their own system with one or more applications at a time, in a single system. This costeffective and expandable approach allows them to configure each system to offer the greatest financial return for the best possible value. As a result of this mantra, Sciton’s systems are widely considered by many laser surgeons to be the gold standard in the industry.
According to Dallas plastic surgeon A. Jay Burns, MD, "I saw the theoretical advantage of Erbium early on, but when Jim Hobart and Dan Negus developed the Sciton product, I expected it would be the best. They demand excellence and that is exactly what they delivered. I have never been disappointed. While I’ve tried erbium lasers from other manufacturers, the Sciton system is the one I prefer and I would never go back to using CO2 after using Erbium."
Dr Burns purchased his Sciton tunable Erbium in 2001 and it is still in service today. "The Sciton JOULE platform is the gold standard of laser platforms in my opinion. Every device they have added over the years, the BBL, Erbium Resurfacing, Erbium ProFractional, diVa, Nd:YAG and Halo, is individually the best device I have used in each space. Therefore, when these devices are offered all in one platform, it is just an incredible collection of tools for the laser enthusiast," he says.
Dr Burns is certainly not alone in his admiration for the Sciton founders" commitment to quality and his enthusiasm for the JOULE system. Sacramento dermatologist Suzanne Kilmer, MD, has known Jim Hobart since he was at Coherent when she was doing the original CO2 resurfacing study.
"He started Sciton shortly after that to create an alternative resurfacing device utilizing the Erbium laser. The genius of their Erbium laser was that you could choose exactly how much ablation and how much coagulation to deliver in each pulse. I use the Sciton Erbium all the time for fully ablative resurfacing of lip lines, syringomas, and acne scars. I think of it as the ultimate skin drill!" she says. "Sciton has always had high integrity and they really value scientific data. They are smart people led by the super-smart Jim Hobart and Dan Negus," adds Dr Kilmer.
The Joule platform was built to last and is the workhorse for many laser surgeons due to its versatility and efficacy. According to Denver Dermatologist Joel Cohen, MD, "I have had my Erbium resurfacing Joule with BBL since 2007, and I still use it every day. I have learned how to use it even more effectively over the years, recognizing endpoints and building on my experience. I truly believe there is no better device to treat significant perioral and periocular wrinkles than Sciton full-field Erbium, and BBL continues to be a very reliable way to treat lentigines.”
As kinder, gentler energy based systems m a y come and go, there continues to be a role for state-of-theart resurfacing lasers to achieve optimal skin revitalization outcomes. New York City dermatologist and laser surgeon Roy Geronemus, MD, explains, "With resurfacing lasers, there is always a need to strike a balance between going deep enough to achieve the desired outcome and the patient’s acceptance of downtime. The Sciton resurfacing laser is a very versatile system that allows you to ablate as deep or as shallow as needed, with or without coagulation. We have been very impressed with the precision and control this technology allows the user to have, and the results."
The beauty of BBL
Another major Sciton innovation, Broadband Light BBL™ has redefined multi-plexing technology. It is widely considered to be the most versatile broadband light system in its class. With a single handpiece, interchangeable filters, adjustable cooling, and a large spot size, BBL is an all-inclusive system that treats acne and vascular conditions, corrects pigmented lesions, permanently removes hair and improves the appearance of sagging skin.
“Sciton BBL is my most popular choice for facial and non-facial skin rejuvenation because it’s fast, cost-effective, and efficacious. It is really a win, win, win!" says Los Gatos, CA dermatologist Patrick Bitter, Jr., MD, who created the FotoFacial® branded treatment.
“In my practice, BBL sets new standards for treating a wide range of skin conditions associated with aging and sun damage. Its broad range of wavelengths allows us to treat pigmentation, redness, and acne without the need for additional handpieces," added Mark Schwartz, MD, FACS, a New York City plastic surgeon. "BBL has been an excellent investment, and I often combine it with Halo for advanced benefits in severely photoaged skin.”
BBL is also the first and only pulsed light system in the industry to offer a full suite of branded and consumer ready treatment options for the aesthetic practitioner to seamlessly incorporate into their practice and market for instant gains. Led by ForeverYoung BBL, the BBL family of brands now includes, ForeverBare BBL painfree hair removal, SkinTyte II for bulk dermal heating without consumables, and newly launched ForeverClear BBL for the treatment of active acne.
"The BBL family of brands makes it much easier for cosmetic business owners to market and differentiate themselves from the sea of competitors that simply offer IPL for treating "reds and browns’. Our branded approach to otherwise commodity treatments helps our customers position their treatments at a premium price point, while providing all of the point of sale tools necessary to earn the confidence of today’s selective cosmetic patients," says Ms Naik.
Halo: the world’s first hybrid laser
The evolution of Halo, the world’s first hybrid fractional laser, was a happy accident. The best products usually are, like BOTOX® (Allergan Plc), Latisse® (Allergan Plc), and Post-It®’s (3M).
"Erbium doesn’t produce a deep thermal necrosis-like carbon dioxide does. In a fractional form, it creates a lot more bleeding. We realized that you could use one wavelength to drill a hole and then fire a second wavelength into that hole to coagulate the blood underneath. But then we noticed that it removed discoloration," says Dr Hobart. And that was how Halo was born.
Halo offers a basic mode with three simple preprogrammed levels for minimal downtime. The operator chooses one of the three coverage levels, and Halo calculates the exact amount of energy necessary to complete a safe and effective treatment, which makes it very delegatable to physician extenders. Patients love the results and the angelic glow that it gives their skin, which is why Sciton named their breakthrough treatment Halo. Halo delivers consistent results along with a positive patient experience without the extended downtime of other treatments. This accounts for why the Halo brand is leading the way for advanced skin revitalization that patients are asking for by name.
According to Vice President of Aesthetic Sales, Robb Brindley, "When you consider cosmetic benefit vs. downtime, Halo has truly changed the game for our customer’s and their ability to satisfy today’s cosmetic patient with an active lifestyle. Halo is like nothing we have ever seen at Sciton — our customers are ecstatic with the impact this new procedure has on their bottom line." Halo has emerged as a gem for the business minded practitioner and represents the highest net revenue procedure for facial skin revitalization in aesthetic medicine today."
Nashville dermatologist, Chris W. Robb, MD, PhD, first learned about Sciton from researching their reputation. "The regional Sciton manager was patient and came in and let us use their device. It met every single claim the company made. We are still using the same machine a decade later. No other laser company is as invested in your success. After the sale is made, the Sciton sales managers don’t vanish. I’ve seen so many reps from other companies disappear after a sale as if they know they got away with something. Sciton truly believes that if you are successful, Sciton is successful," he says.
He continues, "Halo is unique in that the hybridized wavelengths dramatically increase efficacy. The laser behaves like a non-ablative in terms of short downtime and safety, but the results can be dialled in to a patient’s needs so that they have very dramatic ablation-like results. It’s a very flexible device, perhaps the most flexible and advanced device on the market in the last eight years. Even after using the device for three years, I am routinely excited at the results we see. We just had a patient come in for two-year follow-up after one treatment and they still looked amazing. It’s fun to have a laser that patients are happy with and I don’t have to repeat treatments or justify taking their hard earned money. I use Halo as a workhorse. It helps dyschromia, fine lines and wrinkles, and stimulates hyaluronic acid, elastin and collagen on histology. It fits perfectly between BBL and full ablation.”
According to Dr Cohen, "In the past year, I have introduced HALO into my practice. My patients really appreciate the minimal downtime that typically correlates to a “sunburn” for about five days, while achieving noticeable improvement in mild lines, wrinkles, luminosity, pigmentation, and acne scars."
Dr Pozner adds that Halo has changed the paradigm, offering the best of both ablative and non-ablative wavelengths. "With Halo, I can achieve results which I would have only expected from an ablative fractional laser, but get downtimes that I would normally see with a non-ablative fractional laser. It really is the best of both worlds," he says.
Focus on women’s health
Sciton wasn’t the first medical device company to jump into the growth market for women’s health. On the contrary, they took their time and considered all of the options, in keeping with the Sciton philosophy. "I tell people that there’s the tortoise and the hare, and we’re sort of the tortoise. But we’ll win the race eventually," says Ms Naik.
In 2015, Sciton developed a separate business unit called the Women’s Health Group (WHG) demonstrating their commitment to this emerging category. "When we first encountered a competitive vaginal treatment device, we thought it was just another hoax. But we talked to several gynecologists and urogynecologists who were so enthusiastic about this treatment that we decided to build one and let some people try it and see if it works. We engineered the device several times until we started getting good feedback. We brought on Aaron Burton in the role of General Manager to concentrate on this business, hire a great team, and make important things happen," says Dr Hobart.
diVa utilizes the same Hybrid Fractional Laser (HFL) technology that was created for Halo. It provides tunable independent levels of ablation and coagulation, as well as varying levels of density, which allows the provider to customize the treatment based on the patient’s individual needs. diVa’s highly accurate motorized guidance system allows providers to deliver the treatment with increased consistency and decreased procedure time.
Johnny Peet, MD, ACOG, a gynecologist in Houston, and a long-time Sciton customer, was an early diVa user. "When I started looking into lasers in 2012, I asked two colleagues what the best laser on the market was and they both said Sciton without hesitation. So I met with the Sciton rep and I felt that he was honest and trustworthy and genuinely wanted me to succeed with my laser business. Over the next five years, I have come to see that the Sciton staff are quality people that I enjoy working with," he says.
Dr Peet worked on the development of the diVA laser with Sciton. "Our office performed the two clinical trials in 2015 that were used to develop the automated handpiece and the strengthened quartz dilator. We developed a vaginal laser that, when compared to the competition, can treat at over twice the depth, twice the density, and in half the time, three to five minutes. It is the only hybrid fractional vaginal laser and it is the only automated handpiece. No other vaginal laser has the versatility with regard to tunability of the settings. This allows us to treat every person individually and specifically," he says.
According to Nathan Guerette, MD, a urogynecologist in Richmond, Virginia, "I was an early adopter of energy based vaginal treatments and Sciton’s entry into women’s health has revolutionized how we can treat women suffering from these devastating and all too common conditions. The diVa laser allows for the most customized, precise, and automated treatment available in the world. This allows each individual woman to have her issues addressed in a unique and successful manner. Additionally, since diVa is part of the JOULE system, it can be performed with a host of other treatments, which is a significant advantage to both patients and practices as one unit can address multiple needs. Sciton’s approach is refreshing and unparalleled by other companies I’ve seen in the energy-based device arena. They are willing to go above and beyond for training and patient care and stand by their products.”
What’s next for Sciton?
Sciton realizes there is a tremendous opportunity for marketing their premium products internationally, and as part of this effort hired David Percival as General Manager for International to help identify key markets with strong growth opportunities around the world. "I’m very excited for the potential of Sciton’s business outside of North America" says Mr Percival. "I believe that over the next few years our business internationally will play a greater role in the growth of our company. We already have a strong base of key opinion leaders in Europe, the Middle East, Asia, and Latin America."
On the product development side, Dr Hobart says, "We will continue to try a bunch of stuff and keep what works both in aesthetics as well as other medical fields. At the end of the day, we have to stay true to our core values. But it’s a business of course, so everything we do has to have a return on investment. But the way we calculate our ROI is somewhat unique in that we don’t just consider the benefits to the company. We look at the benefits to the physician, patients, and society as a whole. After all, isn’t that the right thing to do?"
Sciton is a Platinum Vendor Member for AmSpa, you can learn more about the JOULE™ system here.
Sciton will also be exhibitng at the upcoming AmSpa Boot Camp in Dallas, TX July 14-15. View the full agenda and exhibitor list here.
By Alex R. Thiersch, JD, Founder/Director of the American Med Spa Association (AmSpa)
In his 2013 letter to Berkshire Hathaway shareholders, company chairman and CEO, Warren Buffett, said, “More than 50 years ago, Charlie [Munger, Berkshire Hathaway vice chairman] told me that it was far better to buy a wonderful business at a fair price than to buy a fair business at a wonderful price.” This might seem counterintuitive to the shark-like practices that are celebrated in certain sectors of the modern business world today, but I believe that if you conduct all your dealings fairly and ethically, you will give yourself a good chance for success.
When you go into business and begin forming partnerships, agreeing to contracts, and making deals with others—whether they are employees or external businesses—you should always strive to make fair deals. In other words, don’t scramble after every last dollar and screw people over just so that you can feel like you’ve “won” something. Some businesspeople will do anything to achieve this feeling, but deals don’t have to have winners or losers—a fair deal allows everyone to get what they want.
For example, if you’re negotiating with someone who you know is undervaluing his or her position, don’t try to take advantage of it just to save a few bucks. You should respect the other party, no matter what. You might even end up paying a bit more than you think you should be paying, but as long as you’re conducting business ethically, you’re likely to build a positive reputation among your peers, which should lead to future opportunities.
I believe in something I call “corporate karma,” which dictates that if you conduct your business fairly, you’ll end up attracting people—employees, business partners, etc.—who are good for your business. In regard to the previous example, if, instead of making a fair deal with the person who is undervaluing his or her asset, you decide to take advantage of his or her inexperience, that person will almost certainly find out what you’ve done and will likely be extremely hesitant to do business with you again. What’s more, he or she is likely to spread word of your shady practices, and you might find yourself frozen out of certain circles because you needed to feel like you “won” the original deal.
There are lots of things in the world of business and finance that you can’t control, but your conduct isn’t one of them. If you approach your dealings ethically and fairly, you’ll improve your chances of success. After all, the best kinds of deals are the ones in which both sides feel as though they’ve won.
By Alex R. Thiersch, JD, Founder/Director of the American Med Spa Association (AmSpa)
First, thanks to everyone who commented on the latest blog and statement related to The Dr. Oz Show’s segment on rogue medical spas. We received a TON of feedback on the issue, and I know that all of you are equally concerned about some of the shady practices that go on in this industry. I think that the most important takeaway from all of this is the importance of realizing that each of our individual actions—and those of our medical spas and teams—impacts the entire industry. Although most do the right thing, it’s the few bad actors that give the industry a poor reputation. Perception is reality in this space, and it’s time that each of us take responsibility—and action—for the industry as a whole. If we do that, we’ll flourish.
With that said, many have contacted me with questions about what to do when you know someone is breaking the law or not following applicable regulations. When should you report someone? Also, who do you report them to?
This is obviously a very relevant question, but there’s not necessarily an easy answer. First, it’s important to understand that reporting a competitor—or anyone for that matter—to the medical board is a very serious matter and should not be taken lightly. In my opinion, this should not be done unless you know, for certain and without a doubt, that the provider or medical spa (1) knows the law, and (2) is actively choosing not to follow it. If you are not certain of those two things, I would at least give the person or practice the chance to become compliant.
Remember, many started out in this industry not knowing the first thing about medical spa law. When I first started AmSpa, nearly 100% of the med spas I talked to were non-compliant. It is only through education and the hard work of the industry that we’ve started spreading the word about compliance. Nevertheless, there are still hundreds, if not thousands, of med spas operating right now that have never been told—not by their boards, their professors, or lawyers—that what they’re doing is wrong. It’s not that they don’t want to be compliant, they just don’t know the rules in the first place.
This is NOT an excuse for the bad actors out there, as most of them are taking extreme steps that are obvious to all of us as being illegal.
What I don’t want to happen is for the entire industry to turn on itself and start reporting everyone else for every perceived offense without truly knowing whether the rules are being broken. Remember: Once you report someone, the cat is out of the bag. The medical board (or nursing board, cosmetology board, etc.) is required to conduct an investigation. If they find nothing wrong, the charges are typically dropped. But guess what? They rarely find nothing wrong. Almost all medical spas are doing at least one thing incorrectly, because most have had no training on compliance, and the rules that are in place are incredibly complex.
So, here’s the rub: If the boards are inundated with thousands of complaints about medical spas, state legislatures will do their thing and start over-regulating the industry. This could end up being the worst thing for everyone.
I want to be clear about one thing: If you know of—and are completely certain—that a med spa is performing dangerous procedures, intentionally breaking the law, or endangering patients, I absolutely, 100% want you to report them to the state medical board immediately. Do not pass GO—report them right away. You know who I’m talking about. These are the folks that are burning and deforming people; the ones featured on The Dr. Oz Show. Those people need to be rooted out, and quickly.
If you know a practice is behaving in this manner the first step is to a) find out what license the spa or practitioner is operating under and then b) contact the board that governs that license. Typically physicians and physician assistants are governed by medical boards, nurse practitioners and other nurses are governed by nursing boards, aestheticians are governed by cosmetology boards, etc. In some states, like Illinois for example, license holders are governed by a licensing department like the Illinois Department of Financial and Professional Regulation (IDFPR), in which case reports should go to this licensing body.
However, the much harder case is when you think someone is doing something wrong, or if you know they’re doing something wrong, but you’re not sure if they even know the rule. Again, if there’s danger to patients or others involved, report them right away. But if not, I would reach out to them and let them know, respectfully, that the states are cracking down and that you’re worried they are not in compliance. Refer them to AmSpa. Send them an e-mail with a link to their state page. Send them one of my videos. But try, at least once, to get them on the right side of the law. Again, remember where you were two or three years ago. Wouldn’t it have been nice if someone reached out and tried to inform you? Do it, it’s good karma.
And I know what many of you are thinking: “But it’s a competitor! Won’t it be good for me if they get caught and go down?” No, it wouldn’t. For one, it’s bad corporate karma (unless, again, it’s obvious and necessary to report them for public safety). And two, as described above, tons of complaints coming at once is going to make it harder for everyone to survive, including your own business. Trust me, this industry is just getting started. There’s plenty of money for everyone.
What if the provider or medical spa ignores you and continues to knowingly violate the rules, or puts patients in danger? Then I want you to report them immediately. Call your medical board and tell them exactly what you know, because those are the “rogue” medical spas that need to be weeded out.
Hope this helps … AmSpa is here for you, so keep sending questions!
As the use of influencers increases in medical aesthetics, so does the potential for legal missteps. Though this method of marketing is beginning to proliferate all industries, since medical spas offer medical treatment the regulations that govern influencer marketing in this space are more stringent than with large brands you might see represented on Instagram, YouTube, or other social channels.
The power of social media influencers is beginning to exert itself on the medical aesthetic industry. After all, if an influencer goes to a medical spa for a treatment, he or she may film the entire visit and broadcast it throughout the world on his or her social media channels. If the influencer has a large following, this can have a significant impact on a medical spa’s business.
However, such visits are not always the organic, spontaneous situations they are portrayed as being. More and more, medical spas are compensating influencers with cash and/or free treatments in order to get them to portray their practices in a positive light. If your medical spa is engaging in this sort of advertising, it’s important to try to understand the legal issues surrounding these matters, although by and large, precedent has yet to be established, as this is a relatively new situation and a new medium in which these transactions are occurring.
For medical spas, it is very important to have a written agreement with the influencer in place. This agreement should dictate what the influencer’s responsibilities are—for example, how many times they are going to post about the practice and what they are going to post. The practice should attempt to have as much editorial control over the posts as possible, since the influencer’s primary goal is to promote his or her brand—not yours—and it’s likely going to be up to you to keep them on message. You have to do what you can to make sure the deal meets your expectations to ensure that you’re getting your money’s worth. Even if you’re compensating the influencer with a treatment only, you need to make your intentions crystal clear, and a written agreement will help both sides understand the nature of the deal. This also helps you to put a value on the services you are providing.
Medical Advertising Rules
Another reason why you should seek as much editorial control as possible is because as a medical provider, the minute you compensate someone to promote your brand you are subject to medical advertising rules and regulations, which are much stricter and have much more dire consequences for violations than common advertising rules. Primarily, this means that you can’t say anything that can be construed as misleading, untrue, aggrandizing, or exaggerated—everything that’s said about your medical aesthetics practice must be provably true. You can’t simply say that you’re the best injector in the world, for example, because you’ll never be able to prove it, so the advertisement can be construed as being misrepresentative.
When influencers are being paid to represent your medical spa (which includes providing them with free services), they are legally acting as a paid advertiser. As such, you’re responsible for everything they are saying, so if they say that your Botox treatment is the best in the city or your medical director is the best doctor in the country, you are responsible for that message, and the situation can get very sticky if a medical board finds out about it. You will need to make sure that the influencer understands that the medical spa is subject to these restrictions and that he or she needs to be careful about precisely what is said in these videos or blog posts. With a written agreement, you can disclaim some of these factors, which allows you to exert some control over the message.
Disclosure Guidelines for Influencers
There are also a few legal issues that the influencers themselves should be aware of for their own sake. In 2017 the FTC issued warnings to over 90 social media influencers regarding required disclosures when being compensated in exchange for coverage, and included some guidelines for compliance. These include 1) Keep your disclosures unambiguous, 2) Make your disclosures hard to miss, and 3) Avoid hard to read, buried disclosures in string of hashtags that are skipped by readers.
Influencer marketing can be a very powerful tool, but it must be wielded with some care in order for your medical aesthetics practice to remain compliant. As I mentioned earlier, the legal aspect of its use in a medical setting is still developing area, so if you’re unsure about how to proceed, be sure to consult with an experienced healthcare attorney.
Intravenous therapy (or IV therapy) is a medical spa treatment that is growing throughout the country, so questions about the law are starting to come in more and more frequently. It has been around in hospitals and medical practices for decades as a means to quickly provide an infusion of fluids and medicines to patients, however with the growth of non-invasive medical aesthetic practices, more business are attempting to offer quick, alternative ways of improving an individual’s health, look and feel.
As such, IV Bars are a growing trend, allowing individuals quick access to hangover treatments via IV hydration with an infusion of vitamins and nutrients. Additionally, some of these facilities offer ongoing treatment to promote anti-aging and revitalization.
What many owners of these facilities do not realize is that the piercing of skin via the IV is the practice of medicine in many states, including Texas. While these procedures are commonly referred to as “cosmetic treatments,” under Texas law, all procedures that involve the injection of medication or substances for cosmetic purposes are considered medical procedures. In fact, Texas law designates them “nonsurgical medical cosmetic procedures.” As such, this limits the ownership of an IV Bar to only a select number of licensed medical providers in many states due to the corporate practice of medicine doctrine, and the supervision requirements over those providing medical services.
Corporate Practice of Medicine
The first major legal consideration is the prohibition against the “corporate practice of medicine.” This is a rule many states have adopted that prohibits lay people or lay entities from employing physicians or offering professional medical services. States that have strong corporate practice of medicine rules include Texas and California. These states, along with several others, explicitly provide that providing the types of non-invasive, elective procedures that an IV Bar does entails the practice of medicine. As a result, this prohibition must be taken into account when setting up an IV Bar.
The second major consideration in establishing and owning an IV Bar is proper supervision. Each state delineates who can provide certain types of medical services, which in Texas, includes IV Bar services. For example, every state generally requires that only licensed physicians perform surgery on a patient, but not all states specifically outline what kind of licensing and training is required for someone to provide elective non-invasive services. However, the Texas Administrative Code (“TAC”), Section 193.17, “Nonsurgical Medical Cosmetic Procedures” does provide additional guidance on supervision and training for Texas-based medical facilities. Based on this rule, IV Bars must follow the same supervision requirements set forth in the TAC.
Based on the above limitations, those non-physicians, wishing to enter into the nonsurgical cosmetic treatments need to make sure they understand the limitations and develop corporate models that are legal under state laws.
Bradford Adatto is a partner at the business, healthcare, and aesthetic law firm of ByrdAdatto. He has worked with physicians, physician groups, and other medical service providers in developing ambulatory surgical centers, in-office and freestanding ancillary service facilities, and other medical joint ventures. He regularly counsels clients with respect to federal and state health care regulations that impact investments, transactions, and contract terms, including Medicare fraud and abuse, anti-trust, anti-kickback, anti-referral, and private securities laws.
For more information and guidance on setting up IV Bars or staffing an IV Bar please contact Brad at firstname.lastname@example.org or (214) 291-3201.
Posted By Alex R. Thiersch, JD,
Tuesday, May 29, 2018
Medical spa owners and operators must maintain an array of insurance coverage to help protect their practices from everything from medical malpractice penalties to flooding. However, there are some types of coverage that medical spa owners may not realize they need until it is too late. Here is a quick look at a few of them.
Businesses didn’t used to have to worry about people hacking into their networks and stealing customer data. Unfortunately, in 2018, cyber security is a major concern for all companies—even medical spas. Cyber liability insurance helps policyholders endure a cyber attack by paying their recovery expenses.
“Its purpose is to help with the notification process, because every individual who could have been impacted by that breach has to be notified,” explains David Shaffer, vice president of Professional Medical, the health care division of Insurance Office of America and AmSpa Medical Malpractice Insurance Program representative. “You have to offer them credit monitoring, and there are going to be legal fees and various other expenses associated with making the situation whole again.”
Cyber liability insurance also provides crisis management and public relations services that can help a policyholder rebuild its name after a cyber security event.
“A lot of my medical spa accounts often wonder, ‘Why is anyone going to be interested in what I have to offer? Why am I going to end up being a target?’” Shaffer says. “Small businesses are the primary target these days for a few reasons. I think the biggest reason is that small business owners are less likely to have a strong defense against someone trying to hack into their systems, as opposed to a larger organization that’s actually going to spend money on building this infrastructure.”
According to PricewaterhouseCoopers, a cyber attack typically costs a small business between $84,000 and $148,000.1 What’s more, 60% of small businesses that suffer cyber attacks close within six months, according to a Champlain College study.2
Cyber liability insurance is available from most business office package insurers, and some malpractice insurers also offer a token amount of cyber liability coverage. And, of course, it can be purchased as a standalone policy.
Employment Practices Liability
If you run a small business, such as a medical spa, it is somewhat likely that at some point, you will be confronted with an employment-related tort—that is to say, a lawsuit filed by an employee who feels that he or she has been mistreated in some way. Employment practices liability insurance covers claims such as wrongful termination, harassment, failure to hire, failure to promote, wrongful disciplinary actions, libel, slander, and any other type of grievance brought by an employee against an employer.
Many medical spa owners and operators overlook coverage for spoilage, but those who have experienced the problems created by a loss of electricity can attest to the fact that this can save a practice a lot of money.
“Most of these facilities are performing some form of an injection, and a lot of those medications need to be kept refrigerated,” Shaffer explains. “If there’s fire or water damage that shorts out the refrigerator and they can’t get into their medications to try and prevent them from spoiling, they need coverage for those medications that have been lost due to the temperature change.”
This coverage can be obtained as part of a business office package policy, but it is not an automatic coverage—it has to either be acquired through a loan endorsement that can be added to coverage or as part of blanket endorsements that are incorporated into a policy.
If you determine that your practice needs spoilage coverage, it’s probably best to purchase a bit more than you think you need, provided you can afford it.
“I had a couple of clients during hurricanes that, while they had some spoilage coverage, they were inadequately insured—instead of needing $10,000 worth of coverage, they needed $20,000, because they did a lot of injection-based services,” Shaffer says. “I would probably say that’s one that needs to be focused on—at least ask to see if the appropriate amount of coverage is there, if it’s there at all. If it’s not, get that taken care of.”
Kybella is an injectable designed to combat “double chins,” and it is becoming extremely popular in the medical aesthetic industry. It is approved by the U.S. Food and Drug Administration (FDA) for treatment of subcutaneous fat under the jaw line and, as long as it is being used in this manner, it should be covered by most insurers. However, some practices are using Kybella to treat fat deposits elsewhere on the body, and that is where coverage problems can arise.
“Because [practices] have notified their insurers that they’re performing Kybella, they believe that it’s a blanket-type coverage that’s being offered to them,” Shaffer says. “All malpractice policies have wording in them that say non-approved drugs and devices are specifically excluded from coverage, so unless they get written verification from their underwriter that off-label services have been approved, the likelihood of them actually having coverage is probably not as strong as they believe.”
Practices that are using Kybella (and any other drugs, for that matter) for treatments beyond those for which they have been approved should consult with their insurers to make sure that they are covered for this sort of use. If not, they should either amend their policy to cover these treatments, which may be possible, or stop offering them.
Making the Right Decision for Your Practice
For most medical aesthetic practices, the amount of insurance coverage they have is dictated by what they can afford. Generally speaking, most of the issues a medical spa will encounter can be covered by malpractice, general liability, property, and worker’s compensation insurance. Policies such as the ones described above sometimes take a back seat to more common insurance types because they aren’t as obviously valuable on a daily basis. However, if your practice can afford it, you may want to consider investing in the more overlooked coverage covered here. After all, you can’t be too safe.
Negative outcomes from medical spa treatments do exist, as highlighted recently by the Doctor Oz Show, though they are few and far between. While there are bad actors in the industry, it is the American Med Spa Association’s belief that the majority of med spa professionals and practitioners are operating in good faith, and with their patients’ best interests at heart.
The Doctor Oz segment, titled “Rogue Medical Spas”, featured some severe adverse outcomes that were a result of some of these bad actors and negligent practitioners. The show reached out to AmSpa for feedback on the topic, and we were happy to provide the following statement highlighting the industry’s commitment to legal compliance and patient safety.
The fact is that the overwhelming number of med spas in existence are extremely safe and provide quality medical care by qualified practitioners. Most med spas are run by physicians and have qualified nurse practitioners, physician assistants, and RNs on staff providing excellent care in accordance with applicable law. The public should be assured that med spas that are run in a compliant fashion are extremely safe, and most med spa treatments have extraordinarily rare incidents of side effects or bad outcomes.
Unfortunately, because the demand for med spa services has grown dramatically over the past five years, the medical spa industry has grown just as fast. As a consequence, there have been some unqualified practitioners entering the industry looking to make money without following the applicable rules. When those bad actors make mistakes and harm people, news coverage of these events invariably follows, and the entire industry suffers as a result. These incidents do not represent the industry as a whole, which as mentioned is comprised overwhelmingly of safe, professional, competent medical professionals.
AmSpa has been at the forefront of dealing with this issue by implementing two strategies – educational articles and videos, and enforcement. For the past five years, AmSpa has been publishing, speaking, and educating both the industry and consumers on what constitutes a safe, compliant med spa. AmSpa is an organization founded on compliance, and its core purpose is to disseminate the applicable rules and regulations so that the industry – and the public – is safe. AmSpa’s website is the only resource where professionals and consumers can obtain information about the rules governing a safe med spa, as unfortunately, the state agencies charged with oversight don’t have the resources to publish, educate or often enforce existing rules. AmSpa’s entire mission is to both publish and educate about this hard-to-obtain information.
In addition, AmSpa has launched an initiative, with the help of medical spa owners, physicians, and regulators, to draft a core set of rules that the industry can universally adopt. This is a complicated process and, although the process has begun, it will take time for these rules to be developed and approved.
In the meantime, there are certain things that the public can and should watch out for when choosing a med spa.
The first is that the public must recognize that medical spas are providing mostly medical treatment. Although some treatments at med spas are non-medical (facials, light chemical peels, light dermabrasions), most of the treatments are medical in nature and should be treated as such. Patients should always be seen by a doctor, a nurse practitioner, or physician assistant, depending on their state. If a med spa offers to treat a patient without being seen by one of those three license-holders, red flags should go up and the patient should seek treatment elsewhere.
Second, patients must do their homework to ensure that the practitioners performing treatments are licensed and trained to perform those treatments. Infrequently, there have been unlicensed, unqualified practitioners who have entered the industry. This is a minute fraction of the industry, but it is also the side that gets the most publicity (and rightfully so, given some of the recent results). The physicians and underlying practitioners must be trained in the procedures they are performing and the only way the public can find this out is by doing some homework. Research the doctor online. Ask for their relevant licensure. Call the medical board and nursing board and look up their license. Get referrals. Because the state agencies tasked with enforcing med spas are overwhelmed with many tasks (the opioid crisis, to name a big one), there isn’t as much enforcement in this area as is needed. So the burden falls upon the consumer – and the med spa owners – to regulate themselves. AmSpa is doing its part, but it’s a big industry and is growing daily.
Third, many of the med spas who perform poor treatments (or offer treatments by unqualified individuals) tend to offer treatments for steep discounts. Aesthetic treatments need to be done carefully and artfully and, as with many things, you get what you pay for. If a med spa is offering highly discounted costs or offering mega deals through discount programs, head the other way.
Finally, most states do not necessarily require a physician to be on site at the med spa while the treatment is being administered, provided that (i) the physician (or nurse practitioner or physician assistant) has examined the patient first, (ii) the physician is immediately available by telephone or other electronic means to respond to questions or emergencies, and, most importantly, (iii) the practitioner who is performing the treatment is trained, experienced, and qualified. But regardless of who’s performing the treatment, there should always be an RN on site, at a minimum, to oversee the procedures. Each state has its own set of regulations about on-site supervision.
I would reiterate that the vast majority of med spa owners and personnel are qualified medical professionals dedicated to helping patients feel better about themselves. This is a great industry and it’s unfortunate that a few bad apples have caused bad publicity. AmSpa is committed to educating the industry and public to ensure all med spas are safe moving forward.
Click here for more information on Doctor Oz segment.
Posted By Administration,
Tuesday, May 22, 2018
Updated: Thursday, May 24, 2018
Injectable treatments like toxins and fillers are central in the medical aesthetic industry, and licensed practical nurses (LPNs) can be valuable pieces of the medical spa puzzle. They typically provide excellent care to patients and can be relied upon to perform a number of non-medical tasks throughout the practice. In many medical aesthetic practices, LPNs even perform injections of fillers and Botox.
Unfortunately for those practices, though, this may create more problems than it solves, since in most states injecting patients falls outside an LPN’s scope of practice. (AmSpa members: check your state’s medical aesthetic legal summary to see who can inject in your practice.)
Before going any further, it’s helpful to understand what an LPN’s qualifications are. An LPN typically has undergone two years of training at a nursing school, and he or she has passed the National Council Licensure Examination-Practical Nurse (NCLEX-PN), which is administered by the National Council of State Boards of Nursing. In terms of the hierarchy of nursing, an LPN comes in below registered nurses (RNs) and nurse practitioners (NPs). An RN has earned a degree in nursing and passed the more rigorous NCLEX-Registered Nurse exam, while a nurse practitioner has done all this, earned an advanced degree in nursing, and passed a national board certification exam.
Of these levels of nursing, only a nurse practitioner is allowed to perform medical procedures in most states and, unfortunately for those who use LPNs to administer injections, most states recognize injections to be medical procedures. Therefore, LPNs should not be performing injections. AmSpa recommends that if your medical aesthetic practice is using LPNs to administer injections, it should stop doing so immediately. If a patient happens to suffer a bad outcome and raises a case with a state medical board, the practice, the supervising physician, and the LPN could be cited for practicing medicine without a license. This could result in severe financial penalties and possibly even create issues with the physician’s medical license.
There is a bit of a grey area here, however. If a physician can prove that an LPN has developed expertise in administering injections, a medical board may see fit to permit the LPN to continue performing these procedures. However, it is nearly impossible for a physician to prove that an LPN demonstrates unusually advanced injection skills, and there is no widely recognized certification specifically designed for injections, so physicians probably should not plan to use this defense if they are caught using an LPN to administer injectables. Physicians and practices should also be wary of LPNs who profess to have an expertise in this area.
It may seem like a good idea to use LPNs to perform injections of fillers and Botox, since doing so conceivably frees up more highly paid nurse practitioners and physicians to perform more lucrative procedures. However, doing so may very well place your practice in peril. Consult an experienced health care attorney to learn about the minutiae of the matter in your state, and stay tuned to AmSpa for any further developments in the matter. LPNs are valuable members of medical aesthetic teams; however, as with all medical spa employees, they must stay within their scope of practice in order for businesses to remain compliant.
(Author’s note: The American Med Spa Association (AmSpa) works with the national law firm of ByrdAdatto that focuses on medical aesthetic legalities and AmSpa members receive an annual complimentary legal consultation. Become an AmSpa member today!)
Posted By Eric Atienza,
Tuesday, May 8, 2018
Updated: Tuesday, May 8, 2018
If practice ownership is your objective, then your first step in reaching that goal is to develop a well-thought-out business plan that establishes the viability of your proposed venture. A business plan details the financial structure and day-to-day operations of your practice. It demonstrates that you have a realistic roadmap for success based on carefully considered ideas about how to develop and manage your business.
Here are five good reasons why developing a business plan is critical:
1) Helps you achieve your goals
Experience has shown that people who document their plans are generally more likely to achieve their goals as non-planners. Actually taking the steps to create a written plan - to think, dream, and research and document your objectives potentially increases the likelihood of ultimately reaching your destination and controlling your business career. In addition, developing a business plan helps you better understand your business. It informs you of your practice's place in the market, so you know the actions that need to be taken to improve and grow your business.
2) Allows you to be proactive
A business plan helps you see potential risks in the market and develop strategies for responding to them. Rather than simply reacting to whatever changes come your way - whether they emanate internally or from outside influences - you have a roadmap that defines precisely where you want to go. You therefore know how to respond to inevitable fluctuations in the business environment. Without a documented plan, your practice is essentially rudderless, with no destination in sight and no guideline for responding to unforeseen circumstances, such as a significant drop in the market, or new technology opportunities.
3) Functions as a communications tool
As a business owner, you may need to borrow funds or hire service providers at some point in your career. Your business plan is an indispensable tool for communicating your business objectives to lenders, contractors, equipment vendors, and others who need to understand your practice vision. The business plan serves as an introduction to you and your practice. It tells your lender that you have the personal know-how and professional means to help ensure practice success. It demonstrates that your future practice is based on a solid grasp of both the local market and outside influences. And it provides the financial rationale for lending funds for your practice purchase or start-up based on historical or projected performance.
4) Provides a competitive edge
With a documented vision of your future in hand, you will be better prepared to take on existing competition as your business plan describes the marketing activities you will use to announce your opening, attract patients, and grow your practice. You will also have a jump-start on new competition - namely, all those graduates who have not yet formulated their career plans.
5) Forms the basis for an exit strategy
A business plan is not only a roadmap for you, but also for your potential buyers. It helps them understand how your practice evolved, whether it met or perhaps exceeded expectations, and whether your vision for future growth was realized. If you sell your practice before your business plan is fully implemented, it can serve as a useful guideline for future owners to further develop the practice.
There are many more excellent reasons for creating a business plan - for example, to share your vision with family members and employees, build a framework to help attract new associates or investors, and provide a foundation for practice valuation. In summary, careful formulation of a business plan will help you focus your vision for the future and ultimately enhance your success. If you don't already have one, get started working on your business plan today.
Visit the Wells Fargo Works for Small Business® and the Business Plan Center page for more information: wellsfargoworks.com/plan.
About the Author
Greg Owens is the Regional Manager East for Wells Fargo Practice Finance. As an experienced consultant and finance expert, he speaks nationally to healthcare professionals advising in practice planning strategies for emerging and established practitioners. His industry background offers practitioners a unique perspective as they approach some of the most important decisions in their professional lives. With more than 25 years of healthcare experience, Wells Fargo Practice Finance specializes in helping healthcare professionals acquire, start and expand their practices with various financing options and a signature Practice Success Program.