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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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Who Can Perform Aquagold Fine Touch Procedures?

Posted By Administration, Tuesday, December 11, 2018

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

Aquagold Fine Touch is a channeling device offered for sale by Aquavit Pharmaceuticals that has become extremely popular in the medical aesthetics industry. It delivers micro-droplets of a variety of drugs—typically including Botox and other toxins, as well as fillers—into the skin. What’s more, its manufacturer claims the treatments it provides are pain-free.

Unlike a typical Botox treatment, in which the drug is directly injected and paralyzes the muscle, an Aquagold Fine Touch treatment is essentially microneedling. It delivers tiny amounts of the drug with which it is loaded over a wide area—much wider than a Botox treatment can manage. It is suitable for sensitive areas where Botox is impractical or impossible, such as the neck, and because the doses are much smaller than typical toxin treatments, it tends to result in skin that looks more natural and vibrant. Patients who wish to avoid the “frozen” look that Botox and other toxins often produce are embracing this technology.

As is typically the case when such a product emerges, we at AmSpa are getting a ton of questions about who can actually perform Aquagold Fine Touch procedures. The treatment appears to be very straightforward—a provider simply applies the device to the skin like a stamp. Its simplicity raises an obvious question: Can an esthetician or licensed vocational nurse (LVN) perform this procedure?

It’s good that we’re getting these questions because it shows that medical spa owners and operators care about remaining compliant, but because technology moves faster than the law, it’s sometimes difficult to determine what the answers are when new technology emerges. However, we can use what we know about similar treatments and technologies to determine the most prudent course of action until government agencies make their rulings.

Simply put, the Aquagold Fine Touch is essentially a microneedling device, so a lot of the issues we’ve addressed in recent years regarding microneedling are likely also going to apply to it. Every state that has looked into microneedling has found it to be a medical treatment, so a good-faith exam must be performed before the procedure, and if a doctor is not administering the treatment him- or herself, it must be properly delegated.

Unfortunately for practices that would like to use unlicensed practitioners to perform Aquagold Fine Touch procedures, this takes them out of the scopes of practice for estheticians and LVNs. In addition, the fact that Botox and fillers are being administered raises the question of whether or not this represents an injection and, therefore, if it can be administered only by a registered nurse or, in some cases, a nurse practitioner, physician assistant or physician.

The only conclusion we can draw with any sort of certainty is that Aquagold Fine Touch will be regulated in much the same way as microneedling, both in terms of medical board rulings and FDA approval, which has become a bit of a sticking point for microneedling products recently. Additionally, mixing different drugs together, as many doctors do with the Aquagold Fine Touch device, may represent a violation of pharmaceutical regulations, as many IV bars are finding out. Does a practice need to be registered as a pharmacy and have pharmaceutical oversight? Can nurses do it? Can LPNs? Who is qualified, capable and allowed to do this under the law?

Unfortunately, I don’t have all these answers at the moment, but I am going to find out, so stay tuned to AmSpa for more about Aquagold Fine Touch treatments. Thus far, it has been very safe and very well received, but the industry needs to have a firmer grasp on the regulatory issues surrounding it.

Tags:  Med Spa Law  Med Spa Ownership  Med Spa Trends 

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How Skin Care Products Benefit Medical Spa Patients

Posted By Administration, Thursday, November 8, 2018

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

The most effective and marketable services offered by a medical spa will almost always be the treatments provided, running the gamut from microneedling, to laser skin resurfacing, to anti-aging treatments, such as Botox. Although these procedures draw patients in, offering skin care products can put your patients on the path to the best long-term results.

Skin Care Supporting Treatments

It should be no surprise that medical spa treatments designed to revitalize the skin can benefit from proper after-care.

“You’re doing your practice an injustice if you’re not sending the clients home with a product that’s going augment the results of the treatments they just came in for,” said Candace Noonan of Environ Skin Care.

After laser skin resurfacing, for example, doctors on RealSelf.com universally recommend emollients for the days immediately following treatment, with some also suggesting home-care treatments containing retinoids to aid in skin healing. After microneedling, RealSelf.com doctors recommend topicals that include a growth factor for improved results and faster healing.

Do your research and ask your skin care sales representatives what home care products will work best with your menu of services.

Skin Care as an Anti-Aging Treatment

Medical spa-based skin care is not limited to after-care. For patients concerned with procedures relating to skin health and/or anti-aging, medical-grade skin care products can be a treatment on their own. Although moisturizers and other skin products are widely available from drug stores and retail boutiques, these products are often very different than what medical spas are able to offer.

According to the FDA, with retail products, patients should be able to select and safely use the product using only the information available on the label. This means that off-the-shelf products need to be safe enough for a customer to self-diagnose and administer without the advice of a trained professional. As a result—although retail products may say they include similar ingredients the concentration of active ingredients—the ingredient concentration is often far lower, in order to ensure it can serve the widest population of people.

“Generally, brands that are sold in drugstores and department stores contain lower amounts of active ingredients so they’re irritation-free for a broad consumer base,” said Lucy Papa, executive vice-president of Canderm Pharma Inc., which sells both medical-grade and retail-grade skin care products.

Since a medical spa will select products specifically based on a patient’s unique needs and train the patient on proper use, these products will contain a higher concentration of active ingredients with clinically tested formulations that can deliver faster and better results.

“We have to look at things like bioavailability, how is it delivered to the skin, is the skin even able to absorb these ingredients,” said Noonan. “When choosing a skin care line … you have to be able to back it up with science as far as what’s actually going to work.”

The onus is on medical spa professionals to educate patients on the benefits of medical-grade skin care, not only with respect to supplementing procedures, but also as a treatment in itself. Selling skin care in your medical spa will not only lead to better results for your patients, but also for your business, as well.

Tags:  Med Spa Ownership  Med Spa Trends 

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Build Loyal Med Spa Clients with a Loyalty Program

Posted By Administration, Wednesday, November 7, 2018

By Dori Soukup, CEO and Founder of InSPAration Management

In the early 1980s, American Airlines’ goal was to increase retention and provide their clients with something extra special. The airline created the first frequent flyer program that allowed travelers to accrue miles and gain benefits when they flew with American. 

American Airlines was one of the first companies in the country to offer a customer loyalty program. It set the standards for the entire industry. Since then, loyalty programs have gained significant popularity. According to a recent study, companies spend more than $2 billion on loyalty programs every year. Statistics show that the average American household belongs to about 14 different rewards programs. 

If you want to increase your retention rate, it is a great idea to offer your clients a loyalty program that will keep them coming back. 

What type of loyalty program should you offer? 

There are several types of programs to offer consumers, and no matter which one you choose, it is important to keep it simple. Below are two of the most effective loyalty programs: 

A. Charge a fee to join the loyalty program. 

For example, Barnes & Noble charges its clients $25 to join their loyalty program. Then, its members can save 10 percent on their purchases for an entire year. For a person who frequents Barnes & Noble weekly, this type of program provides great benefits. The end-of-year savings are significant. This program keeps me loyal to Barnes & Noble, and the $25 fee to join is well worth it. You can do the same, but I recommend you charge more. For example, you can charge a fee of $150 to join and offer them the following:

  • Two $25 gift cards—to be utilized one at a time 
  • A complimentary consultation valued at $50 
  • A complimentary makeover valued at $50 
  • A loyalty program welcome kit 
  • A discount of five to ten percent on every spa visit or retail purchase 

You are giving them the $150 enrollment back in value. This allows you to raise cash flow, and encourages the new member to visit the spa on a regular basis. As part of the loyalty program, the client will benefit by receiving a small discount with each spa visit. 

B. The second plan offers clients a chance to join for free and earn points with every visit. You can reward them by letting them earn one point for every dollar they spend. Once they reach a certain number of points, they can use them toward gifts, services or products. 

You will need to determine the amount of rewards you are willing to offer. For example, if someone spends $500, they will earn 500 points. If you wish to offer them a 10 percent reward, you will need to select a $50 prize that they can have once they reach 500 points. This represents a 10 percent reward. If you are offering this type of loyalty program, I recommend you offer merchandise as a reward because your cost will be $25, but the client will receive a value of $50. This practice allows you to decrease your loyalty cost to a five percent reward instead of 10 percent.

Select gift items that you can brand with your logo. This includes robes, T-shirts, hats and water bottles, all displaying your logo. This method has many benefits: 

  1. Provides your loyal clients with desirable, quality gifts 
  2. Gifts are a great way to promote your business 
  3. Shows a higher perceived retail value while reducing your loyalty cost 
  4. Saves money and increases retention 

The point system can also be used as a marketing tool. If you have some slow slots within your schedule, you can reward your clients with double points on slow days or hours. Instead of offering discounts, offer double points for promotions. You can ask your clients to write reviews to earn points. Or, let them earn points when they “like” your page on Facebook, and so on. 

Keep in mind that no matter which program you offer, you have to market it, track it and deliver a great guest experience. 

Offering a loyalty program is a great opportunity to promote your business and recognize your VIP clients with special value while motivating your clients to keep doing business with you. Implement a loyalty program and increase your retention! 

Dori Soukup is the Founder and CEO of InSPAration Management, a firm specializing in medical spa and salon business development, advanced education, and business tools. Throughout the past 15 years, Soukup has contributed to the success of spa companies worldwide. Her passion is developing innovative, effective educational programs and business strategies leading to exponential growth and profits. She is the recipient of the American Spa Preferred Educator award and is a sought-after global speaker within the spa and medical spa industries.

Tags:  Business and Financials  Guest Post  Med Spa Ownership 

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Medical Spa Bad Press: Coming to Terms with Compliance

Posted By Administration, Thursday, November 1, 2018

By Alex Thiersch, CEO of the American Med Spa Association

Bad outcomes and patient injuries in medical spas are appearing in more and more headlines across the country. It is evident to many who work in the medical spa industry that there are a number of grey areas in the rules and regulations that govern it, and that certain unscrupulous medical spa owners and operators exploit these inconsistencies while sacrificing quality patient care to make money. Media pieces highlighting these bad actors in the industry are appearing with increasing regularity, and even the Doctor Oz show recently highlighted “Rogue Med Spas” that endanger patient safety. These reports express the industry’s problems to the public and, when the public catches wind of a health issue, you can bet that local, state and federal regulators will need to address it sooner or later.

View the full segment.

See AmSpa’s full statement on the segment here

The days of the medical spa industry being the “wild west” are likely coming to an end. So if your practice is not entirely compliant with your state’s medical statutes, it is certainly in your best interest to identify the ways in which it falls short and address them as soon as possible.

AmSpa members can check their state’s medical aesthetic legal summary to find the laws governing their practice.

The Truth

Stories such as the Doctor Oz report are not positive for the medical spa industry, but they’re not necessarily hatchet jobs, either—many medical spas are, in fact, operating illegally, and untrained, unqualified employees are burning patients with lasers, among other potentially serious violations.

Medical spas and laser centers have become so popular—and so profitable—that some owners and operators rush to open them and, as a result, they are often not properly formed and not compliant with state and local statutes. Traditionally, there has not been a great deal of enforcement of these violations, but this is changing.

Medical spas have become so prevalent that state regulatory agencies simply cannot ignore them anymore. As is seen in the rise of media coverage of these issues, patients who suffer unforeseen outcomes will not hesitate to complain to the media. Personal injury attorneys have also picked up on the trend—you may have noticed television commercials and print ads calling for clients to sue medical spas and laser centers. The story is out there, and it only takes one aggrieved patient to cause a medical spa’s world to come crashing down.

Although it is undeniable that there is a certain level of non-compliance that exists in the medical spa industry, medical spa owners and operators need to be asking themselves how they can start becoming an industry that regulates itself, so that they don’t have these types of continuing issues with state regulators.

Creating Compliance

To start on the road to compliance, medical spa owners and operators should take the following steps.

  1. Know the law. While there are grey areas, many answers can be found in state’s practice acts with just a little bit of searching.
  2. Reach out to local health care attorneys for evaluation. Most medical spas only contact a lawyer when they’re already in trouble, not at the front end where the lawyer can help prevent trouble down the road.
  3. Work toward understanding. You goal should be to understand the basic core principles regarding medical practice and realize that, while this is a lucrative industry that is often quite safe, there is still some level of danger.

AmSpa pledges to continue its efforts to educate medical spa owners and operators to make sure that they are operating in compliance with the law. It also aspires to educate the public in order for them to understand the difference between a medical spa that is compliant and one that is not, as well as inform them about what the treatments offered by medical spas actually entail. AmSpa is also pushing for standardization of laser training across the industry—in some states, there are no training requirements, and a lack of proper training can lead to outcomes such as the ones that Doctor Oz aired to the general public.

The industry needs to come together to discuss how it should be regulated, as it is clearly growing and is not going away. There is some guidance in the laws as they are written, but the states do not do a particularly good job in educating the public about what they say and mean. Still, enforcement is ramping up, and medical spa owners and operators must be properly prepared in order to comply and avoid more negative media coverage in the future.

Attend an AmSpa Medical Spa & Aesthetic Boot Camp to learn how to build and run your medical spa to be profitable and compliant with all of the laws in your state.

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

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Don't Sell Yourself Short When Negotiating for Your Med Spa

Posted By Administration, Wednesday, October 31, 2018

By James M. Stanford, JD, Partner, ByrdAdatto

Negotiating for any business, including a med spa, is not easy. Most prefer to avoid confrontation and that preference has its virtues. At the same time, however, that general mindset can result in a tendency to cave during negotiations. It does not mean that one should be provocative and confrontational during negotiations as such a stance may have adverse results. However, holding your position, even when you believe you may not have the bargaining power, can yield surprising results.

Time after time, I see parties give in far too easily on a particular term or position when it’s not in their best interest. This often occurs after discussing the matter informally with the other side (i.e., no legal counsel present for either side) and accepting verbal assurances that in reality mean very little when the language of the contract will be controlling.

Bargaining power is established by many variables, including the size of the respective parties, norms of the industry to which the contract relates, the alternatives available if negations fail, and current market forces in terms of supply and demand for the goods or services being negotiated. One thing is clear though, you can obtain more bargaining power than you think by being willing to walk and find an alternative if the other party is unreasonable in demanding one-sided, onerous terms. I have been pleasantly surprised on occasion when a client holds their ground on certain positions and we ultimately obtain better terms than expected. The only downside is that you may actually have to walk and find another vendor, lender, or location to lease. Nevertheless, this may result in a better deal provided you are seeking terms that are generally reasonable.

Without getting into the specific nuances and art of negotiating, the primary factors for strengthening your position that should be in place before you even start negotiating are as follows:

  1. try to have alternative vendors, lenders, locations, etc.  in case your first choice is unreasonable;
  2. engage legal counsel who is experienced in the industry and subject matter of the deal; and
  3. start with the mindset that you will walk if you cannot obtain reasonable terms.

Of course, this will not apply in situations where you don’t have an alternative and you must consummate the particular transaction. For the most part, however, you will gain substantial bargaining power when you are as willing to walk away from the table as you are to consummate the transaction.

James M. Stanford is an attorney and partner at the ByrdAdatto law firm. From transitions, mergers, and acquisitions to structuring complex ownership arrangements, James enjoys the personal reward that comes from bringing parties together and making deals happen. James practices primarily in the areas of health care and corporate law with a focus on intellectual property. A proud father, Jim served in the U.S. Army and is fluent in Russian. In his spare time, he enjoys hunting, fishing, and spending time outdoors. 

Tags:  Business and Financials  Med Spa Ownership 

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Self-Regulation: Equipment Manufacturers and Training Centers Need to Get on Board

Posted By Administration, Tuesday, October 30, 2018

By Alex Thiersch, CEO of the American Med Spa Association

In this space a couple of weeks ago, I wrote about the need for self-regulation in the medical aesthetic industry. In that piece, I mostly focused on how medical spa owners and operators can help the industry by observing certain standards that AmSpa is helping to develop. However, the need for self-regulation is not limited to practitioners—it extends to equipment and device manufacturers, as well as clinical training facilities.

After an AmSpa Boot Camp or a consultation where I detail the legalities of laser use, for example, I’m often approached by attendees who say, “I was trained by a laser manufacturer, and they didn’t tell me any of this stuff.” What I’ve found is that there are a lot of people out there who give a lot of disparate information and, oftentimes, it’s not accurate and it leads people to believe that they can do things that legally they cannot do.

We at AmSpa have been working very hard since the organization’s inception to educate not only medical spa owners and practitioners, but also the industry as a whole. If everyone knows the laws under which they operate, everyone can be on the same page.

AmSpa works with many laser manufacturers that have listened to us and acted in very responsible ways. However, I’ve also heard countless stories from people who were told by manufacturers or training facilities that they can do something that they plainly cannot, and they feel like that is unfair.

This is not just an AmSpa problem or a medical aesthetic practitioner problem—it is an industry problem. The entire industry need to be on the same page. Every member of the industry needs to buy into the same set of standards, and we all need to be teaching the people who work in the industry the same thing. It makes no sense and does nobody any good to, say, take a long laser course and learn to perform treatments if a practitioner cannot legally administer them.

Therefore, AmSpa is calling on the entire industry—not just medical spa owners and practitioners, but also device manufacturers, drug manufacturers, and training facilities—to start taking compliance seriously, because it’s the only way for the industry to evolve in a positive direction. Everyone wants to succeed and make money, but if the industry is overly regulated due to negative outcomes and people acting in bad faith, it will be extremely difficult for the industry to become better and larger than it already is.

I’m looking forward to discussing self-regulation with everyone at forthcoming AmSpa Boot Camps. We will be in Orlando next week for our final Boot Camp of 2018, and our just-announced 2019 itinerary includes stops in Los Angeles, Chicago, Atlanta, Seattle, Dallas, New York and Orlando. Click here for more information and to sign up for a Boot Camp near you. We’ll also be discussing this matter at the Medical Spa Show in Las Vegas in February 2019. Click here to learn more about this year’s agenda and event … it shouldn’t be missed!

 

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

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Corporate Practice of Medicine: Living or Dead?

Posted By Administration, Monday, October 29, 2018

By Patrick Armstrong O’Brien, Legal Coordinator, AmSpa

Many states prohibit non-physicians from owning medical practices either directly or through a business entity. This is known as the Corporate Practice of Medicine doctrine, which AmSpa has previously discussed here. The concern these states have with corporate practice of medicine is that the non-physician control will interfere with the physician’s professional judgement in the physician-patient relationship. Whether or not that fear is founded, it has resulted historically in many states forbidding the practice. AmSpa members: To see what your state’s policy is please your state legal summary.

Over time, the practice of medicine has evolved and become more complex and interconnected.  Physicians no longer practice with just a bag and a stethoscope. They render medical services through a team of professionals and specialists who utilize an array of advanced machines. This complexity and interconnectedness has weakened much of the original motivation for the prohibition against medical services being delivered in a corporate structure. Often, these prohibitions are seen more as a hindrance than an aid to effective care. There has been a general trend to move away from or weaken this prohibition. This has taken the form of passing statutes that affirmatively allow corporate practice or remove the restrictions.  

On one end of the spectrum, you have states similar to Alabama, which does not prohibit physicians from being employed by a corporation as long as the physician is free to use his professional judgment in making medical decisions. This is evidenced in their statutes and opinion letters from the attorney general’s office. You also have states such as Idaho where the board of medicine previously adhered to the doctrine. However, in 2016, they affirmatively rejected the doctrine and would no longer discipline their licensees for practicing in a corporate structure. 

On the other end of the spectrum, you have states such as California. The state statutes clearly prohibit the practice of medicine by corporations and the California Medical Board actively polices and enforces it. The California Medical Board even offers a resource page of their website to address the subject. These states and others like them provide medical spas with clear information on the types of business structures permitted.

Other states may have lax or infrequent enforcement of their prohibition. Wisconsin is an example: the state laws clearly prohibits laypersons from employing physicians to provide medical services as outlined in a Wisconsin Attorney General letter available here. However, there appears to be no recent history of enforcement actions for violating this rule. Wisconsin isn’t alone; many other states have infrequent enforcement of their corporate practice rules. This can create a lurking issue for people wanting to open a medical spa.   

Those preparing to enter the medical spa field may look around and see examples in their state of non-physicians hiring on medical directors or partnerships between doctors and non-doctors.  Depending on the state, these arrangements may be completely fine or they may be in violation of that state’s laws. Where there is lax or infrequent enforcement by the state’s attorney general or the medical board, a medical spa may go years without issue. However, the risks still remain.  Future attorney generals or medical board members may change their policies and begin aggressively bringing enforcement actions. Or, if the medical spa or physician is brought to their attention for other reasons, the corporate structure may result in additional penalties or discipline. The improper business structure could be used as a challenge to contracts in disputes among business partners.

Just like you still wear your seatbelt even though you don’t plan to be in a car accident, having the proper corporate structure for a medical spa is important, even if no one has recently gotten in trouble over it. As the aphorism on ounces of prevention goes, taking time to structure your medical spa correctly at the beginning can be good insurance against possible future issues. If you would like to learn more about medical spas business structures and other legal issues please consider attending an upcoming AmSpa Boot Camp or the 2019 Medical Spa Show.

 

Tags:  Med Spa Law  Med Spa Ownership 

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