Is Your Healthcare Business Really a Practice

Is Your Healthcare Business Really a Practice?

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In today’s video, we discuss certain healthcare business models incorporating medical devices that might have to deal with FDA rules on those devices.

We’ve actually had clients come to us with business models like these, so we have plenty of experience with the finer points of law that are applicable here.

I’m Michael H. Cohen, founding attorney of the Cohen Healthcare Law Group. We’ve advised over a thousand healthcare industry clients on healthcare and FDA legal issues. Today, I’m going to explain why a healthcare business could actually be considered a healthcare practice.  By the end of this video, you’ll know how this might happen, and what it means for your business.

Let’s begin by imagining a healthcare business owner. He’s not a physician or any other kind of licensed healthcare professional. But he recovered from some serious injury, illness, or accident using a machine he bought from Company X. The business owner bought the rights to Company X’s machine via a licensing agreement, and the agreement lets the owner brand this as his own therapy method.

So what is the machine, or the owner’s therapy business actually doing?

The business essentially plucks a therapy out of a licensed profession—it could be medicine, chiropractic, nutrition and dietetics, physical therapy, or several of these—and sells it to patients.

It may not have been immediately clear what the business was doing, but it’s actually providing a professional service. The customer is someone suffering from something, and the business has the answers.

So Company X made this great machine, and the business was entrepreneurial enough to purchase a license from them to use it, and now the business is making claims for the machine that mean it’s a medical device and can’t escape the regulatory requirements for medical devices. And although the owner is not a licensee, the business is selecting a treatment for his customers, making the business an unlicensed medical practice.

You can understand now how a business that is ostensibly offering therapy, and not offering any devices for sale, can become entangled with FDA medical device enforcement issues. To help you untangle a complicated set of circumstances like that, there’s no replacement for an experienced healthcare and FDA attorney who can review your business plan for possible legal risks. It pays to be prepared.

Thanks for watching. Here’s to the success of your healthcare venture, we look forward to speaking with you soon.

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