Compliance Issues for Medical Fitness Centers, Gyms, and Wellness Centers – Part 1

Today’s new gyms and medical fitness centers offer a variety of services other than treadmills and basketball courts. Gyms are expanding what they offer so that customers have a full range of services and a full range of health benefits. While all these services may attract new customers, gyms and other health fitness centers need to understand how each new service and each new employee or business partner can raise compliance issues with federal and state laws.

Many physicians already prescribe gym exercises for people with chronic pain. Now many gyms and fitness centers are hiring doctors. Some hires are full-time. Many physician hires are so the gyms and can direct patients who have cardiac failures, suffer broken bones or muscle tears, or endure any type of short or long-term health treatment.

Gyms are using telemedicine to help their customers get access to a quick consultation. They are offering health services such as acupuncture, massage, meditation, yoga, hypnotherapy, and sculpting. Some fitness centers are even offering CBD oil to help manage some of their patients’ medical and health issues.

Medical fitness centers

As the fitness industry targets people with heart disease, lung disease, and diabetes; it can be hard to know whether a gym is offering just exercise that focuses on physical appearance or is crossing the line into offering health care. A new venture that is growing is the rise of medical fitness facilities that provide:

“seamless integration of healthcare services, wellness, and fitness programs to provide preventative and rehabilitative care to members, patients, and the surrounding community. Today, these medically integrated facilities create vibrant and energetic environments where personal health and development flourish through the guidance of trained fitness professionals.”

A Medical Fitness Facility is NOT a Gym

Some of the key differences between medical fitness centers (many of which are run by hospitals or used by hospitals and physicians) and tradition gyms that focus on just workouts are:

• The exercises offered by medical fitness centers should be approved by medical professionals.
• The exercises approved ty the physicians should be effective and not focused on the latest trends.
• The medical fitness centers should work with a team of doctors, dieticians, and therapists that they can refer you too if needed. [There is a caveat that the referral of medical patients may violate Stark Law and the Anti-Kickback Statute – which will be discussed in the next article in this series]
• The staff at medical fitness centers generally need be licensed, certified, and have appropriate degrees. Gyms need to be careful about certifications too, but many gyms are lax about this requirement – often, at their peril.
• Fitness centers should be trained to focus on diseases. Gyms generally are focused on appearance but not disease.
• Both fitness centers and gyms need to be careful about the information they provide. The information must be accurate. It can’t mislead consumers into thinking they will get results that aren’t justified.

An overview of some of the legal risks involved in running gyms, wellness center, and medical fitness centers

All these new work relationships and new services pose a variety of risks for the gym, for the doctors who work with them, and for the patients. Fitness centers and physicians should consult with an experienced healthcare lawyer before beginning any new work or offering any new service. There are numerous laws that apply to employment agreements, referral arrangement, patient privacy, false advertising, offering medical devices and drugs, and other issues. Failure to comply with these laws and regulations can result in civil penalties, criminal actions, and the forced closure of your business.

A skilled lawyer will help you understand what compliance issues apply to your business or practice. He’ll then help you prepare a plan for you and your employees to follow. If complaints arise, he’ll help defend you before the Federal Drug Administration, the FTC, and other federal and state agencies. He’ll work to help you reestablish your compliance credentials.

Federal laws that may apply to gyms and fitness centers

Some of the laws that may apply to gyms that are adding these multiple services include:

• HIPAA. Electronic records such as those kept by physicians are subject to the Health Insurance Portability and Accountability Act of 1996. This law governs the privacy and transfer of electronic health records.
• Federal Food, Drug, and Cosmetic Act (FD&C Act). This set of laws gives the FDA (Food and Drug Administration) the authority to regulate the safety of food, medical devices, drugs, and cosmetics. Fitness centers may be subject to FDA oversight if they:
  • Sell or provide nutritional products – many do
  • If they directly or through the prescriptions of the doctors they employ prescribe or dispense any drugs or medications
  • Sell or provide cosmetics such as skin care products
  • Sell or provide medical devices.

The FDA determines whether the products the gym or fitness center sells qualify as a food, medical device, drug, or cosmetic device. Often, the very same marketing materials and websites centers use to promote their products will be used against you to show that your gym’s products are subject to FDA regulations.

How the FDA regulates nutritional products, cosmetics, medical devices, and drugs

The FDA regulates products that might be sold through a gym or health center in many ways including the following:

• Nutritional foods. Nutritional products must have a fact label. The FDA states that “Food labeling is required for most prepared foods, such as breads, cereals, canned and frozen foods, snacks, desserts, drinks, etc. Nutrition labeling for raw produce (fruits and vegetables) and fish is voluntary.” The FDA refers to these products as conventional foods. Labeling requirements include information about:
  • Serving sizes
  • Servings per container
  • Calories
  • Calories from fat
  • Percent daily value
  • Nutrient content

Health bars, drinks, and other nutritional products sold by a gym or fitness center must have these labels on them.

In 2016, the FDA added new labeling requirements, “Manufacturers with $10 million or more in annual sales must switch to the new label by January 1, 2020; manufacturers with less than $10 million in annual food sales have until January 1, 2021 to comply. Manufacturers of single-ingredient sugars such as honey and maple syrup and certain cranberry products have until July 1, 2021 to make the changes.” The labels were enacted to cover “new scientific information, including the link between diet and chronic diseases such as obesity and heart disease.

• Dietary Supplements. Dietary supplements are considered food. They have separate labeling requirements.

The FDA regulates both finished dietary supplement products and dietary ingredients. These products are regulated under the Dietary Supplement Health and Education Act of 1994 (DSHEA):

“Manufacturers and distributors of dietary supplements and dietary ingredients are prohibited from marketing products that are adulterated or misbranded. That means that these firms are responsible for evaluating the safety and labeling of their products before marketing to ensure that they meet all the requirements of DSHEA and FDA regulations:”

If products are adulterated or misbranded (for example, the marketing and descriptions say they are not drugs when they are – or that that they’re not dietary supplements when they are), the FDA will likely send out an FDA warning letter. Failure to respond to the warning letter, with the help of a skilled healthcare attorney, could result in fines, penalties, and other sanctions.

• Cosmetics. The FDA does not directly regulate cosmetics other than color additives before they go on the market. However, there are federal laws that regulate cosmetics in interstate commerce (generally the purchase, sale, and distribution of cosmetics across state lines). The two most applicable laws are:
  • The Federal Food, Drug, and Cosmetic Act (FD&C Act)
  • The Fair Packaging and Labeling Act (FPLA)

The FD&C Act defines cosmetics by their intended use, as “articles intended to be rubbed, poured, sprinkled, or sprayed on, introduced into, or otherwise applied to the human body…for cleansing, beautifying, promoting attractiveness, or altering the appearance.”

“If the product is intended for a therapeutic use, such as treating or preventing disease, or to affect the structure or function of the body, it’s a drug (FD&C Act, 201(g)), or in some cases a medical device (FD&C Act, 201(h)), even if it affects the appearance. Other personal care products may be regulated as dietary supplements or as consumer products.”

If all of this sounds confusing when you think about selling powders, lotions, and other products that are designed to beautify but also help someone heal, the best course of action is to review all the products your gym sells with an experienced health and wellness lawyer.

• Medical Devices. The FDA defines a medical device as:
  • “an instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent, or other similar or related article, including a component part or accessory which is: recognized in the official National Formulary, or the United States Pharmacopoeia, or any supplement to them,
  • intended for use in the diagnosis of disease or other conditions, or in the cure, mitigation, treatment, or prevention of disease, in man or other animals, or
  • intended to affect the structure or any function of the body of man or other animals, and which does not achieve its primary intended purposes through chemical action within or on the body of man or other animals and which is not dependent upon being metabolized for the achievement of any of its primary intended purposes.”

Any products that qualify as medical devices that are sold or used in a gym, wellness center, or medical fitness center will be subject to regulation by the FDA.

The devices must be properly registered and listed with the FDA. Medical devices are subject to premarket approval:

• • Premarket Notification (510(k)). A 510(k) is a premarket submission made to FDA to demonstrate that the device to be marketed is safe and effective, and substantially equivalent to a legally-marketed device that is not subject to Premarket Approval.
  • Premarket Approval (PMA). This is the FDA’s process of scientific and regulatory review to evaluate the safety and effectiveness of Class III medical devices.

The aim of even the most basic athletic activity is to help someone get healthy. As soon as health becomes the goal of any company, numerous red flags are raised because the federal and state governments make patient safety and patient privacy a priority. These red flags which cover the products and services the center or facility provides must be reviewed with an experienced healthcare law. Violation of HIPAA, the Federal Food, Drug, and Cosmetic Act (FD&C Act), and other laws can result in substantial fines, criminal charges, and the need for your business to close down.

Contact Cohen Healthcare Law Group, PC to review your federal and state compliance issues with an experienced FDA healthcare lawyer. We help a broad range of healthcare providers and companies including hospitals, doctors, fitness centers, medical spas, and life-science companies.