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How to Create an Effective MSA

Posted By Administration, 8 hours ago

By Michael S. Byrd, JD, partner, ByrdAdatto

Performance of a car may be best measured by the engine, not the outer workings. A monitor or program does not deliver performance for a computer; that is found in the hardware. One must dig beneath the surface to find the source of performance. The same may be said about the management services agreement (MSA) for the management services organization (MSO) model commonly deployed in health care arrangements. The arrangement performs by the design of the MSA.

The MSO is the tried and true model for non-physicians to own a business in the medical services market. Alex Thiersch, partner at ByrdAdatto and CEO of the American Med Spa Association, published an article about unpacking MSOs. ByrdAdatto also published an article about nuances that may impact the design of the MSO model. We’ve even written an article about the influx of private equity into the medical and dental markets and the use of the MSO model for these investments.

Yet, to truly understand the essence of the MSO model, like the engine of the car or the hardware for computer, you must understand the MSA. The MSA defines the relationship between the medical entity providing medical services and the MSO entity providing management services. The importance of the MSA can be seen by the essential components of the arrangement that are defined in the MSA:

  • The flow of funds from patient encounter to profit;
  • The economic sharing of funds between the medical practice and the MSO entity;
  • The precise services to be provided by the MSO entity to the medical entity;
  • The separation of clinical responsibility to the medical entity in a way that complies with state regulations; and
  • The role of the physician often found in a medical director agreement (123s of a Medical Director).

A well-written MSA should look approximately 80% the same as another well-written MSA in another arrangement. This 80% should define boundaries from a compliance perspective, and hopefully it’s tailored in a way to work from one arrangement to the other. The other 20% deals with the heavy details of the particular arrangement. The 20% addresses the economics between the parties, as well as the roles and responsibilities of the physician providers, the use of space, the payment of personnel and the use of equipment.

The number one mistake with MSAs is for clients to grab onto a previously used MSA or, even worse, an MSA used by a colleague to memorialize their arrangement. The risk is obvious from a business perspective if the MSA flow of funds does not match the business plan. However, if the MSA does not reflect the reality of how the arrangement is functioning, the greater risk becomes one of compliance violations and the risk of enforcement that may lead to invalid arrangements, medical board sanctions, and, in some cases, arrests and criminal prosecution.

The greatest risk for using a faulty engine for a car or faulty hardware for a computer is economic loss. The greatest risk for using a faulty MSA is economic loss and compliance enforcement.

For more information on setting up a compliant MSA, please contact ByrdAdatto to schedule a consult.

With his background as both a litigator and transactional attorney, Michael Byrd brings a comprehensive perspective to business and health care issues. He has been named to Texas Rising Stars and Texas Super Lawyers, published by Thompson Reuters, for multiple years (2009-2018) and recognized as a Best Lawyer in Dallas by D Magazine (2013, 2016, 2017, 2018). He routinely lectures at continuing medical education seminars on the various business and legal issues that medical professionals face.

Tags:  Business and Financials  Med Spa Law  Med Spa Ownership  Med Spa Trends 

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The Ins and Outs of Physician Contracts

Posted By Administration, Wednesday, April 17, 2019

contract

By Alex R. Thiersch, JD, CEO of the American Med Spa Association (AmSpa)

An effective employment contract between a medical practice and a physician should be a win-win for the employer and employee. If one or both sides don’t approach the negotiation in a thoughtful manner, they could find themselves disappointed with the outcome. Here are a few features that should be included in a mutually beneficial contract.

(For more information on medical spa employment contracts, view AmSpa’s webinar on the topic; it is free to AmSpa Plus members.)

Goals

A practice should consider what it wants to accomplish with a contract with a physician. Does it need to fill a position? Does it want to provide service to more patients? Is a transition of ownership part of the equation? The answer to this can dictate the type of person the practice wants to recruit (i.e., a younger doctor versus a more experienced one) and affect the way the employment agreement is designed. If a physician who has entrepreneurial aspirations is hired to simply tend to patients, for example, neither side will be particularly happy, and the relationship likely will not last very long.

The practice’s intentions must be clearly communicated during the recruitment process, and the contract must be built around that philosophy.

Along the same lines, a physician must honestly evaluate his or her goals when negotiating a contract with a medical spa. These contracts typically last for one to two years, but both sides typically expect that the relationship will continue thereafter, so a physician must come to terms with his or her long-term plan. Is this where he or she wants to forge a career? This should influence how the contract is negotiated.

The physician also needs to consider a “plan B”—if this arrangement does not work out, how does he or she continue his or her career? The answer to this question heavily influences how the contract is evaluated. For example, if the physician wants to put down roots in the city where the practice is located but the contract has a restrictive non-compete clause, it is in his or her best interest to negotiate the terms of that clause, as it would severely restrict his or her options if it the relationship with the medical spa does not work out. Click here to learn more about non-compete and non-solicitation clauses.

Compensation

A medical spa needs to balance the practice’s economics, the risk tolerance of its owners, and salary expectations in its market when negotiating a contract. A competitive guaranteed base salary with some form of incentive-based bonus system can help secure top talent who might be considering other options. There are several ways this can be arranged, depending on what the physician prefers.

The physician, on the other hand, must understand his or her risk tolerance. While a high base/low bonus structure might appeal to some, others will want to pursue a low base/high bonus structure. The physician must determine his or her comfort level with the contract’s salary structure—if it is not optimal, it must be negotiated.

The physician also must be rational when determining his or her actual earning power. If the market does not offer enough potential business to justify taking a low base/high bonus salary, the physician should seek a different deal.

Ownership

The practice must determine what it wants to accomplish in terms of ownership with the hire, as it will affect everything from scheduling and coordination to top-level decision-making. The practice’s owner(s) also must consider if the hiring should be part of their exit strategy; if so, the contract must be created with that in mind.

The physician, meanwhile, must determine how he or she would build the practice and determine how the practice’s ancillary revenue streams compare to those offered by others. Ownership offers different appearances for different entities, so the physician must establish what he or she wants and what the practice can provide. What is the investment? What is the potential return? What is the risk? The contract should answer all these questions.

Creating a mutually beneficial contract is a complicated matter. Both sides must assess the risks and rewards, and they must also be willing to compromise on less pressing matters. A careful reading of a contract is a must, however—if both sides don’t thoroughly read the contract, they have nobody to blame but themselves if it doesn’t work out.

For more information about structuring your medical spa profitably and compliantly, attend an AmSpa Medical Spa & Aesthetic Boot Camp and become the next med spa success story.

Tags:  AmSpa's Med Spa & Aesthetic Boot Camps  Business and Financials  Med Spa Ownership 

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An Extra Special AmSpa Boot Camp

Posted By Administration, Monday, April 15, 2019

asheville north carolina

By Alex R. Thiersch, JD, CEO of the American Med Spa Association (AmSpa)

On June 1 – 3, AmSpa will present a very special Medical Spa & Aesthetic Boot Camp in Asheville, N.C., at the Omni Grove Park Inn. Like other AmSpa Boot Camps, it will feature a variety of sessions designed to help medical spa owners of all experience levels run their practices more efficiently. However, while most Boot Camps feature two days of insightful education from industry experts, the Asheville Boot Camp will include three days of training that is designed to help medical spa owners and operators optimize their businesses.

AmSpa’s Boot Camp program is devised to help medical spa professionals familiarize themselves with the issues that make the industry uniquely challenging. Over the course of two days, attendees learn about important legal compliance issues of which medical spa operators may not be aware, business strategies that help maximize profitability, and big-picture practice management information, among many other things. Click here to view the tentative agenda—more information about the presenters and sessions will be added in the near future.

In addition to the AmSpa Boot Camp program on June 1 – 2, attendees will experience Terri Ross’ “Making Money in Your Med Spa” program on the morning of June 3. Ross is an industry thought leader and business builder who is the founder and owner of Terri Ross Consulting. Her expertise in practice management has helped several clients improve their businesses, and this presentation is designed to help medical spa operators improve their profitability. Best of all, it is included at the same price as a standard AmSpa Boot Camp.

Until May 1, you can sign up to attend the Asheville Boot Camp Extra at a special discounted Early Bird rate, so click here to register today. This is a tremendous value, so don’t let this opportunity pass you by!

Tags:  AmSpa's Med Spa & Aesthetic Boot Camps  Business and Financials  Med Spa Law  Med Spa Ownership  Med Spa Trends 

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Do You Believe Strong Leadership Can Affect Your Medical Spa’s Profitability?

Posted By Administration, Thursday, April 4, 2019

money

By Tim Sawyer, president & co-founder of Crystal Clear Digital Marketing

Does anyone in the med spa industry think strong leadership can affect profitability?

If you had asked me this question a week ago, I would have replied with a resounding, “Yes, of course.” After my experience this past weekend, I’m not so sure. In fact, I am more convinced that the basic concept of leadership in this community is not just undervalued, but almost deemed irrelevant. While I have given many talks on the subject at dozens of shows—including The Medical Spa Show, Vegas Cosmetic Surgery, A4M and The Aesthetic Show, to name a few—my experience this past weekend cemented my belief that now more than ever, we need to keep this topic in the forefront of our discussion through our lectures, blog posts, podcasts and national meetings.

Why? As the co-founder of two separate marketing and software businesses appearing in the Inc. 500 list of fastest-growing privately held companies, I am a firm believer in the very direct link between strong leadership and profitability. As a lifelong entrepreneur, I am constantly bombarded with books, seminars, podcasts and events touting the value and strategies for effective modern leadership. I get it. No leadership equals no sustainable growth. As a former business student, it’s one of those, “Duh, obvious,” things. For surgeons and med spa owners who have spent their lives focused on anatomy, clinical outcomes and patient safety—not so much. And I am not suggesting there is a lack of desire to be stronger leaders; I am suggesting there is diminished value and a lack of understanding.

Back to this past weekend. As I walked onstage to deliver my best 15-minute lecture on leadership, about 40% of the 150 attendees in the room—mostly surgeons—took the opportunity to use this time to take a break, get coffee and mingle. In other words, almost half of the attendees viewed this topic as somewhat irrelevant.

At this point, I know what you’re thinking: “Tim is a sore loser because people walked out of his talk.” Fair enough, and there may be some truth to that. However, it is more concerning to me that these leaders lacked the appreciation of the important role they play in their practices’ success outside of the 12-hour days spent doing treatments and procedures. In fact, I even asked the question, “How many of you want to spend the rest of your lives working 12-hour days with your primary (only) source of revenue coming from your physical labor?” Of course, that drew some intense stares, intentionally. Because this is what is at stake for many of the people in the room.

Entrepreneurs understand that you can’t scale a business if the majority of the revenue comes from the owner’s direct labor. To further explore this concept, I recommend you read The E-Myth; this would be a great investment of your time if this topic is remotely interesting to you. To get scale in your business, surrounding yourself with great people who can also make significant contributions to the business in terms of revenue is the number-one priority. The most successful entrepreneurs know they have done their job well when their businesses can function on its own with little or no direct involvement or supervision from the founders. Many of these strong leaders begin their business with the end in mind. They ask the question, “What do I need to do in this circumstance to create an entity that is either investable by others or saleable to another entity?” More simply put, if I bust my butt for 10 years, how do I exit and get paid? This is every entrepreneur’s dream.

That said, the rules are a little different in elective medicine, as the skills and training of the surgeon or provider essentially represent 100% of the value of the practice. And here’s the billion-dollar question: Is the current state a situation that can never be changed, or is there perhaps another way of looking at the role of the modern entrepreneurial surgeon leader?

I think part of the problem lies in the way we talk about, celebrate and showcase only those practices experiencing hypergrowth (for a variety of reasons, and I include myself in this group). We create this unrealistic expectation that anyone who applies this model or buys that device will immediately ascend to the elective medical elite, which is at best a bunch of B.S. When we do this, we disenfranchise the 90% of practices and med spas that could benefit the most from applying a few basic leadership principles, even if they only have a few employees.

Here are a few principles you can apply right away to increase the value of your practice and set it on a path to realistic sustainable growth. First, ask yourself, “Do I believe there is a correlation between effective leadership and increased profitability?” If the answer is no, sorry about the time you wasted reading this, and hopefully you will find my next article more valuable.

When I pose this question to live audiences, I always get a lukewarm response. But let’s assume we agree that leadership could make a 10% difference in the profit of your clinic. So, step one is to assign a dollar value to the 10%. Now, the next logical step (if we agree) is to first be realistic. Do you spend 10% of your time working on your leadership skills and strategic thinking? If the answer is no, we have already diagnosed a major problem, which is great and free.

Next, how can you put leadership to work in a small elective medical practice?

  • Lead yourself. Be mindful of the words you use, be respectful to employees and manage to your principles. Ask yourself, “What are my most important guiding principles that I will not compromise?” Are you walking that out daily?
  • Share skills. Employee turnover hurts when you have invested time and energy into training. Get over it. Things could be worse, like if you don’t train them and they never leave… yikes. Don’t forget—if you’re not training someone up to replace you, you will never be replaced. (Cue the surgeon-working-in-a-coffin music.)
  • Train and practice together. It’s a team and you’re the leader. Lead. This requires time. If you make it a priority and then a habit, you will improve the culture in your practice.
  • Hold your team accountable.
  • Have a plan, set goals and manage to the plan. You can’t manage what you can’t measure.
  • Share your vision and passion often. People love to feel like they are a part of something special.
  • Incentivize the right behaviors and address the wrong ones.
  • Be inspired. These simple universal truths can apply to any business of any size. You don’t need more consultants, more devices or more marketing. You just need some time to reflect in front of the mirror. Look past the outside and the comparative narrative and focus on the incredible leader inside of you. This is truly one of those scenarios where size doesn’t matter. Crystal Clear started with three employees, and now we have 80. Remember, if we agree that improved leadership skills could make just a 10% difference in the profitability of the business, that’s 10% more time and money you have to do the things that mean the most.

In addition to a world-class digital marketing and software platform, Crystal Clear offers a full-service consulting team to help you get the most out of your people, your processes and the tools you use to grow your clinic in 2019 and beyond. We get it. You can’t do everything by yourself. Fortunately, you don’t have to. Our world-class training team is here to help. They have been in your shoes in real life, long before becoming trainers. To learn more about Crystal Clear, visit www.crystalcleardm.com or call 888.611.8279.

Tags:  Business and Financials  Guest Post  Med Spa Ownership  Med Spa Trends 

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Join AmSpa at the L.A. Medical Spa & Aesthetic Boot Camp

Posted By Administration, Wednesday, April 3, 2019

la boot camp

By Alex R. Thiersch, JD, CEO of the American Med Spa Association (AmSpa)

We are just a few days away from AmSpa’s Los Angeles Medical Spa & Aesthetic Boot Camp at the Sofitel Los Angeles at Beverly Hills, and we’re extremely excited for the opportunity to help medical aesthetic professionals develop their practices. There's still time to register for the event—just click here to sign up. Here’s a quick overview of the program:

Friday, April 5

Prior to the Boot Camp, AmSpa will present a special after-hours tour of the Lasky Aesthetics & Laser Center, one of the most successful medical spas in the United States. This event, which is sponsored by BTL Aesthetics, takes place from 5:30 – 7:30 p.m. PST and will show attendees how this well-appointed practice makes its clients comfortable while providing a high standard of service. Space for this exciting event is limited, so click here to register.

Saturday, April 6

The Boot Camp begins at 8 a.m. with a breakfast, followed at 8:30 a.m. with my opening keynote. From there, we will move into the main program:

  • 9 – 10:30 a.m.: The Plan, presented by Bryan Durocher (Durocher Enterprises)—What are the most effective ways to develop a business plan for your medical spa? Medical Spa Consultant Bryan Durocher discusses the ins and outs of the planning process and helps determine how long it realistically takes to open a practice.
  • 11 a.m. – 12 p.m.: The Marketing Plan and Social Media, presented by Brandon and Jenny Robinson (Skin Body Soul MedSpa)—This session will help you determine how to most effectively market your medical aesthetic practice using both traditional methods and cutting-edge techniques.
  • 1 – 1:30 p.m.: Medical Aesthetic Hot Topics Panel, featuring Toni Lee Roldan-Ortiz (Environ Skincare) and Tim Sawyer (Crystal Clear Digital Marketing)—This panel, moderated by yours truly, will feature a spirited discussion of the current issues and events that concern medical spa owners and operators.
  • 1:30 – 3:30 p.m.: The Law, presented by Alex Thiersch (AmSpa) and Michael Byrd (ByrdAdatto)—In this presentation, we’ll discuss the long-standing and emerging legal issues that every medical spa owner needs to know about. As you can imagine, there is a lot to cover here, since new concerns seem to be arising daily lately.
  • 4:15 – 5 p.m.: The Treatments, presented by Terri Ross (Lasky Aesthetics)—Learn about the most profitable and popular treatments available to your practice, and find out how to best determine which treatments are right for you based on the state of your practice.
  • 5 – 6 p.m.: The Digital Marketing Ecosystem, presented by Tim Sawyer (Crystal Clear Digital Marketing)—Find out how to effectively spread the word about your medical aesthetic practice and how best to determine what’s working and what’s not. Your practice’s digital presence is more important than ever before, and curating it should be a top priority.

Saturday will wrap up with a cocktail reception from 6 – 7:30 p.m.

Sunday, April 7

Once again, the Boot Camp begins at 8 a.m. with a breakfast.

  • 8:30 – 9 a.m.: Anatomy of a $5-Million Med Spa, presented by Alex Thiersch (AmSpa)—Have you ever wondered what the difference is between your medical spa and one that’s mega-successful? It might be less significant than you think. This presentation will show what a $5-million med spa is doing right—and what you might be doing wrong.
  • 9 – 10 a.m.: The Financials, presented by Bryan Durocher (Durocher Enterprises)—At the end of the day, the money you’re bringing in is the most important measure of your practice’s success. This presentation will, among other things, demonstrate how to properly develop a budget and use metrics to determine your med spa’s strengths and weaknesses.
  • 10:30 – 11:30 a.m.: The Long-term Revenue, presented by Brandon and Jenny Robinson (Skin Body Soul MedSpa)—Simply being successful isn’t enough for a medical aesthetic practice; you have to know how to maintain and grow your success. In this session, the Robinsons will show you how to build patient loyalty and move your business forward.
  • 11:30 a.m. – 12:15 p.m.: The Consultation, presented by Terri Ross (Lasky Aesthetics)—As the old saying goes, you never get a second chance to make a first impression. Learn how to put your best foot forward with effective patient consultations—and how to turn them into consistent business.
  • 1 – 2 p.m.: The Lessons, presented by Louis Frisina—Every medical spa is different, but the successful ones share several common traits. In this session, Business Strategy Consultant Louis Frisina discusses the qualities that are typically found in practices that bring in a significant amount of revenue.
  • 2 – 3 p.m.: The Team, presented by Bryan Durocher (Durocher Enterprises)—A medical spa is only as good as its personnel, so it’s important to make sure that you hire a staff that can do everything you want it to—and more. In this session, you’ll learn about recruiting, hiring and retaining employees who can make your medical spa dreams come true.

Also, you’ll have the chance to visit with a number of exceptional vendors throughout this event. Attend the L.A. Medical Spa Boot Camp to check out the latest and greatest from the following companies:

We hope you can join us in Los Angeles this weekend. This AmSpa Boot Camp is a tremendous opportunity to get your medical aesthetic business headed in the right direction and learn some tips and tricks that can take it to the next level. Click here to register!

Tags:  AmSpa's Med Spa & Aesthetic Boot Camps  Business and Financials  Med Spa Law  Med Spa Ownership  Med Spa Trends 

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How Do You Open a Med Spa?

Posted By Mike Meyer, Monday, April 1, 2019
Updated: Tuesday, April 2, 2019

open for business

By Alex R. Thiersch, JD, CEO of the American Med Spa Association (AmSpa)

Opening any business involves numerous complications that are difficult to predict and prepare for, but opening a medical spa is significantly more complicated than creating most other types of businesses. After all, a medical spa requires high-level business acumen, a thorough understanding of local medical rules and regulations, and dedicated, properly trained employees in order to succeed.

That’s a tall order when you’re just starting out, but help is available. If you find yourself overwhelmed by the obstacles in your way, you may want to attend one of AmSpa’s Medical Aesthetic Boot Camps. Early-bird registration for the Chicago Boot Camp—which takes place at the Chicago Marriott Southwest at Burr Ridge on May 4 – 5—ends at 11:59 p.m. EST on April 4, so if you’re near the Windy City and want to learn more about how to make your medical spa a success from day one, you can do so at a discounted rate until then.

Develop a Business Plan

Creating a detailed business plan is a vital step for any prospective business, and a medical aesthetics practice needs to address an unusual number of issues. Where will the business be located? How will it be designed? What will set it apart from its competition? How will you go about recruiting talented employees? What will you do to attract patients? What types of patients do you wish to attract? All these questions and many more will need to be addressed at the earliest stages of your business’ development.

Learn About Compliance

New medical spa owners might not know much about the rules and regulations they’ll be expected to follow when they enter the medical aesthetic industry, but it is important that they learn as quickly as possible. The “medical” part of the equation makes operating a medical spa much more complex than it would be if it was simply offering aesthetic services such as facials and manicures. The practice’s ownership structure must be developed in accordance with state laws, and that’s just the start—all medical treatments must be performed with proper supervision, and all marketing must be conducted with special attention paid to patient privacy and other factors. Regulations vary from state to state, so there is no one way to approach this, but it is extremely important that you develop an understanding of what is expected of a compliant practice.

Plan for the Future

The medical aesthetic industry is constantly changing, and understanding the metrics that provide the best insight into medical spa success can help keep you ahead of the curve. It is also important to learn how to efficiently operate and maintain the value of your practice. Your practice is about to become your life, so you need to know what you can do to make it as healthy as possible for as long as possible. And while you probably won’t want to think too much about your exit strategy while you’re opening your practice, it’s probably worth having that conversation with your partners, financial consultants and attorneys, as well.

These topics and many more are addressed at AmSpa’s Medical Aesthetics Boot Camps. If you are preparing to open a practice, it’s certainly worth your while to attend one near you. Early-bird pricing for the Chicago Boot Camp can be secured until 11:59 p.m. on April 4, so if you want to attend, click here to register. If you can’t attend the Chicago Boot Camp, keep in mind that subsequent 2019 Boot Camp events are scheduled for Atlanta, Seattle, Dallas, New York and Orlando; early-bird pricing is available for all of these events right now, so sign up today.

Tags:  AmSpa's Med Spa & Aesthetic Boot Camps  Business and Financials  Med Spa Law  Med Spa Ownership 

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Why a Risk Assessment Is Critical for Your Practice

Posted By Administration, Monday, March 25, 2019

checklist risk assessment

By Alex R. Thiersch, JD, CEO of the American Med Spa Association (AmSpa)

For a medical aesthetics practice to best serve its patients and maintain a viable business, it needs to understand the ways in which it may be compromising patient safety or otherwise violating the law. Therefore, if your practice has not undergone a thorough risk assessment recently, it should do so as soon as possible.

“A risk assessment establishes the baseline of where a practice is from a compliance perspective and helps identify risk areas that need to be fixed,” said Michael Byrd, partner at ByrdAdatto, a Dallas-based law firm that specializes in business and health care law. “Let’s get a baseline of where you are so we can figure out what needs to happen.”

A properly conducted risk assessment will cover both business and medical concerns, and it will identify areas where the practice is compliant, areas where the practice needs to be mindful to remain in compliance, and areas where the practice is not compliant that need to be corrected.

“A risk assessment is essentially a blend of legal and clinical evaluation of compliance,” Byrd said. “From a legal perspective, we’re making sure that the ownership is set up in a compliant way, and then that the policies and procedures are set up in a compliant manner. Clinically, do they have appropriate policies and procedures as it relates to treatment, delegation and supervision, OSHA, telemedicine, HIPAA, etc.? A lot of times when we’re doing a risk assessment, we have a lawyer look at it, plus a clinical person, and sometimes even an IT person helping to evaluate if there’s a cyber-security risk from a HIPAA perspective.”

To begin the process of conducting a risk assessment, a practice should engage with a health care law firm that has a great deal of experience conducting such investigations. Additionally, stakeholders need to be prepared to be as open as possible so evaluators can get a clear idea of what is going on at the practice.

“We’ll identify the ownership documents to send us, and then if it’s a full risk assessment, we’ll involve a clinical consultant who’ll look at it from a clinical perspective, and then we’ll work together to make sure that the policies and procedures navigate that particular state’s laws,” Byrd said. “There’s a big element of knowing who’s doing the initial exams and who can be delegated to provide the treatment, and even by procedure, there are certain procedures that are only appropriate for certain providers. That’s a lot of the back and forth we’ll have with the consultant.”

If this sounds like a major undertaking, well… it is. However, it is assuredly better to know the areas in which your practice falls short of compliance and what can be done to correct that rather than remain ignorant and be surprised when an investigation uncovers violations.

“It can be overwhelming, but if it can be integrated as part of the culture of the business, our clients are very successful,” Byrd said. “A risk assessment is really just a starting point, but then you have a culture of following these procedures and evaluating as laws change, technology and procedures change, and your personnel changes, evolving your compliance plan with that. The clients that adopt that as part of the culture of their business have been really successful in minimizing that risk.”

Byrd says that after his firm conducts a risk assessment, it typically will check in with clients every three months to make sure that everything is on track. If a firm does not offer periodic check-ins, he recommends repeating the risk assessment process annually.

Tags:  Business and Financials  Compliance is Cool  Med Spa Law  Med Spa Ownership  Med Spa Trends 

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How Can A Consultant Help Your Medical Aesthetics Practice?

Posted By Administration, Friday, February 15, 2019

By: Alex R. Thiersch, JD, CEO of the American Med Spa Association (AmSpa)

The work of a consultant can be extremely valuable for a medical aesthetics practice. When you spend every day operating a medical spa, it can be very difficult to determine why certain things are working and others are not. Ideally, you would be able to step back and view your business with a critical eye, but for numerous reasons, that simply can’t be done

If you’re thinking about why a program you designed isn’t working out, for example, it’s difficult to set aside the amount of work you put into creating it and look at what’s wrong with it objectively. That program is a bit like your child—you put an incredible effort into it, and while you know it isn’t perfect, you won’t hear others speak ill of it. However, sometimes you need someone to tell you that something is wrong, and that’s where a consultant comes in.

A consultant can take a look at your business using unbiased eyes and years of experience in the industry. Consultants aren’t parts of your organization, so they can look at it with an unbiased view. They can see what you’re doing right and what you’re doing wrong in ways that someone who has skin in the game simply can’t, and they can help you determine a suitable course of action for correcting the problems with your organization.

Of course, you may want to bring in a consultant to help you finish a major project or help install a new dimension of your business, and that’s another perfectly viable way to use his or her talents. A good consultant has been part of the industry for many years and has seen what works and what doesn’t, so having him or her help you create a new part of your business can help it get off the ground efficiently and avoid problems that programs created without outside expertise may encounter. 

A consultant can even help a company in ways that might compromise a full-time employee, in that he or she can say what needs to be said without any fear of recriminations. They might even be called upon to make decisions that someone in the organization simply can’t make because of their proximity to the principles involved.

And while a consultant’s time certainly isn’t cheap, it’s a bargain when compared with the damage that inaction can do. What’s more, a consultant isn’t an employee, so you don’t need to worry about paying taxes or conferring benefits, and depending on the contract you negotiate with him or her, you can scale the amount of work in accordance with what you need. 

If your medical spa needs a fresh set of eyes on a problem or a new voice to propose a solution, consider bringing in a consultant. A medical spa might seem like a closed system, but it doesn’t have to be. An outsider can help your business become the best it can be.

As with last week’s blog about mastermind groups, you may be wondering why we’re bringing this up in this space. Stay tuned to find out.

Tags:  Med Spa Ownership 

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Med Spa Slammed with Class Action Lawsuit for Violating TCPA

Posted By Administration, Thursday, February 14, 2019

By: Alex R. Thiersch, JD, CEO of the American Med Spa Association (AmSpa)

Ever heard of TCPA? 

Most people haven’t. 

It stands for Telephone Consumer Protection Act. And it’s the second most frequent federal lawsuit after employment law claims. And now a med spa is on the receiving end

Simply put, it’s a cash cow for plaintiff’s attorneys. And why not? As Willie Sutton once opined… he robbed banks because that’s where the money was. 

What is it and what triggers it?

In 2019, TCPA is mostly triggered by SMS text message marketing. The business send offers to its prospects by text message. Text messages are generally opened and read. It’s effective.

SMS texting implemented by automated systems is regulated by the Telephone Consumer Protection Act of 1991 (TCPA). TCPA is enforced by the FCC. The FCC updated its TCPA regulations in July of 2015. And there’s a recent appellate court ruling which considered whether the FCC over-reached. That ruling created more questions than answers. The litigation machine roars on. 

Initially, TCPA was designed to prevent dinner being interrupted by pre-recorded junk marketing calls to landlines. That was in 1991. When we had land lines and actually ate dinner together. Today, TCPA mostly tackles text messages. 

The statutory damages for violating TCPA is $500 per text or actual damages, whichever is greater. The statutory damages are up to $1,500 per text for willful or knowing violations. 

It doesn’t take much for this number to get large quickly. 1,000 x $500 = $500,000.

Because the number can get large quickly, class action lawsuits in this domain are enticing to attorneys, even when a business has done everything right. There is no cap on aggregate statutory damages. Multi-million dollar settlements are not uncommon. 

In Kolinek v. Walgreen, Walgreens settled a class action suit for $11 million. What horrible thing did Walgreens do? A consumer provided his mobile number to Walgreens when he picked up a prescription. The pharmacist allegedly stated the number would only be used to verify his identity for future refills. Walgreens then sent messages reminding the consumer to pick up his refills. (Here, the number was not actually used to “verify his identity”; it was just a helpful reminder about refills.) The consumer filed a TCPA class action lawsuit. Multi-million dollar settlement. By the way, each consumer received about $20. The lawyers received millions.

How does a business prevent such mischief? If the text message is advertising or marketing, the business must obtain express prior written consent from each consumer who will receive a text. The consumer cannot be charged for the text. There’s a laundry list of items that must be included in a consumer’s written consent to be TCPA compliant. And the burden is on the business to obtain this consent. Getting this consent is like getting HIPAA consent for every consumer – yet again.

We’re sure a business that sells TCPA services will tell its clients not to worry. But, are they willing to indemnify the client for potential multi-million dollar judgment? Most errors and omissions or general business liability policies do not cover TCPA claims or they explicitly exclude TCPA claims. Medical malpractice insurance claims do not cover TCPA claims. 

At least with medical malpractice, a plaintiff needs to allege an injury. The doctor is typically covered with medical malpractice insurance. And many states cap damages. 

With TCPA, the sky is the limit. The mistake can be innocuous. And insurance is generally not available to ease the sting.

Still, it IS possible to promote robust SMS text message marketing campaigns and comply with TCPA. The time to get this right is before there’s a problem. 

Tags:  Business and Financials  Med Spa Law  Med Spa Ownership 

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What Is a Mastermind Group?

Posted By Administration, Tuesday, February 5, 2019

By: Alex R. Thiersch, JD, CEO of the American Med Spa Association (AmSpa)

In business, every idea is valuable. Internal brainstorming can only offer you so much, since it may reflect your company’s corporate culture in ways that limit its efficacy. However, from day-to-day, you are likely far too busy managing the operations of your business to seek out and consider ideas from outside your immediate circle. Therefore, it is important for business leaders to seek out ways to interact with peers from around the world in order to help develop new ideas and keep their companies on the cutting edge of their markets.

Participation in mastermind groups is a very successful way business leaders develop new and exciting ideas. Initially named by noted self-help author Napoleon Hill in 1925, this concept involves a group of entrepreneurs who get together to give each other support, talk about their business, knock each other down and build each other up, and make themselves available as resources. This idea isn’t exactly new—for example, Benjamin Franklin founded a group called the Junto in 1727 that was designed to provide mutual improvement for its members. Franklin was inspired by numerous other similar groups throughout history. Nowadays, these groups convene once a month, usually as a teleconference, and during the meetings, each person will be given a limited amount of time on the “hot seat,” when his or her ideas are reviewed and evaluated.

However, the structures of such meetings and even of the groups themselves are flexible and can be amended to better reflect the circumstances in which they exist. In the aesthetics industry, for example, many resources are available to practice owners and operators, but much of the information out there is very topical and may have limited utility for many members of the group. Therefore, a mastermind group based in the medical aesthetics industry might hypothetically benefit from a certain amount of curation—the groups should be kept small and grouped according to factors such as revenue, location, business cycle, personality, etc. Because the groups are small, the members can go into greater depth during their “hot seat” segments and learn more about issues endemic to their particular section of the industry. What’s more, these groups should also consider having a business coach in order to help group members get into an entrepreneurial mindset to better build their companies.

People who have participated in mastermind groups typically give the process positive evaluations. When knowledge is coordinated in such a way, it provides tangible benefits to those who participate, and helps create accountability that often carries over to members’ standard business. These groups can also help members look at problems and develop solutions in ways they wouldn’t have otherwise, and encourage participants to reach for levels of success that they may previously have thought unobtainable.

If you find the idea of mastermind groups intriguing or potentially beneficial for your business, be sure to keep an eye on the news that comes out following The Medical Spa Show 2019, which takes place at the Aria Resort & Casino in Las Vegas, February 8 – 10. 

Tags:  Med Spa Ownership  Med Spa Trends 

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