Mitigate Legal Quagmires While Digital Health Opportunities Expand Your Healthcare Practice and Business by Following These Core Legal Rules

Can Joe, the chiropractor who does “functional medicine,” incorporate an ND to expand into digital health (telemedicine)?

Joe, a chiropractor who incorporates functional medicine into his practice, contacted our healthcare attorney team about a project involving a naturopathic medical doctor (ND or MND) in Joe’s chiropractic practice.

The ND isn’t licensed in Joe’s state where Joe has his chiropractic license; an in addition, that state doesn’t license naturopathic medical doctors.

Beyond that, Joe wants to use the ND to provide telemedicine and digital health services; and Joe also wants to expand his chiropractic beyond his office, and wonders about the legal implications.

By the time Joe contacted us, he had researched these issues, and gone through five different attorneys and law firms, including his own business lawyers.  The first two attorneys couldn’t help him, the third told him “gray area, don’t do it;” the fourth charged him a lot while they handed him off from partner to partner searching for answers beyond each partner’s expertise, and the fifth contradicted the conclusions of the one partner in the fourth who had some legal answers.

Telehealth and Telemedicine Laws Open Up Practice Possibilities

Telehealth and telemedicine law continues expanding, but the problem is that the laws vary by state and Joe the functional medicine chiropractor wants to expand across state.

Joe has a second issue by styling himself as a functional medicine chiropractor, where the scope of practice of chiropractic does not include medicine; and the legal definitions of “chiropractic” vary by state.  If Joe practices in a way that exceeds his scope of practice, that can be considered the unlawful practice of medicine.  But that’s another issue and we’ll get to scope of practice in functional medicine practices, elsewhere.

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The core legal rule that drives Joe’s practice opportunities is that whether Joe (and/or his ND) can even offer digital health depends both on the home state in which Joe has his chiropractic license and physical office, and on the remote state in which the patient is located.

This complicates Joe’s legal position even further, because some states license NDs and some don’t; therefore, Joe has to be careful about aiding and abetting the unlicensed and unauthorized practice of medicine if he is offering the naturopathic doctor’s services in a state where NDs are not licensed.

New York’s Telemedicine Laws as one example

Joe’s business lawyer wasn’t even looking in the right place.  He found New York Insurance Law, Section 4306-g, Telehealth, but this is an insurance statute.

This statute says:

The use of electronic and information and communication technologies by a health care provider to deliver health care services to an insured individual while such individual is located at a site that is different from the site where the health care provider is located.

So far, so good, but does this mean the ensuing telehealth rules only apply to health care services that are reimbursable by commercial insurance?  What about cash practices – and many functional medicine practices are cash practices.

Then we have the additional overlay as to whether the healthcare practitioner is opted out of Medicare or still Medicare par or non-par.

Moreover, this statute does not address the next question, which is, even if the physician or chiropractor is licensed in New York to provide healthcare services, must that person (or an appropriate designee, such as physician assistant (PA) or nurse practitioner (NP) provide a good faith, prior appropriate exam and must that be in-person, prior to delivering services digitally, via Skype, the iPhone, or other electronic means?

In a totally different statute, New York Public Health Law Article 29 G defines telehealth as follows:

Telehealth is defined as “the use of electronic information and communication technologies to deliver health care to patients at a distance, which shall include the assessment, diagnosis, consultation, treatment, education, care management and/or self-management of a patient.”

The statutory definition goes on to limit telehealth to:

  • “Telemedicine:” Real time 2-way audio-visual communication compliant with HIPAA while the patient is at the originating site and a telehealth provider is at a distant site.
  • “Store-and-forward:” Provider to provider electronic transmission of patient’s health information (i.e. email).
  • “Remote patient monitoring:” Collection of personal health information and medical data from a patient at an originating site for a provider at a distant site for use in treatment and management of medical conditions that require frequent monitoring.

Under this provision, telehealth excludes audio-only, fax-only, and email-only transmissions to the patient.

It’s always important to understand what state laws include and exclude from the legal definition of “telemedicine.”  If Joe is simply faxes a patient, calling a patient, or emailing a patient, then at least this statute suggests that limitations of telehealth rules do not apply.

Layered on top of this are the confusing references in Medicare and Medicaid law to the “originating site” and the “distant site.”

Typical Telemedicine and Digital Health Requirements

When analyzing Joe’s situation, there are some standard legal rules that apply to any kind of telehealth practice.

For example, Connecticut Public Act No. 15-88, “An Act Concerning the Facilitation of Telehealth,” includes requirements that physicians:

  • Communicate with the patient through real time, interactive, two–way communication technology or store and forward technology;
  • Have access to, or knowledge of, the patient’s medical history, as provided by the patient, and the patient’s health record, including the name and address of the patient’s primary care provider;
  • Conform to the standard of care applicable to the physician and expected for in-person care as appropriate to the patient’s age and presenting condition; and
  • Provide the patient with the telehealth physician’s license number and contact information.

Unfortunately, as of this writing, nothing is said about the requirement of an in-person exam.  However, the law requires during the first telehealth interaction with a patient, the provider must inform the patient about telehealth treatment methods and limitations, obtain the patient’s consent to provide telehealth services, and document the notice and consent in the patient’s health record.  Ultimately, the physician must evaluate whether the conditions being treated via “telehealth” meet the applicable standard of care for the treatment of that medical condition.

If the telehealth service is to be covered under any Medicare reimbursement, the telehealth services must meet those for Medicare-covered services, and again, this is set forth somewhere else under applicable state law.

One of the issues Joe is going to face is that he has a checkerboard of state laws to evaluate if he proposes to expand the chiropractor and naturopathic doctor digital health service, nationally.  If Joe is in New York, he might consider starting with the tri-state area, as then the analysis begins with telehealth law in New York, New Jersey and Connecticut.

On the other hand, if Joe desires to garner a national market for his telehealth program for patients, then he would benefit from a good summary of the legal issues he is likely to face across states, beginning at a high level. For example, so far, we’ve talked about:

  • The need for licensure in the remote state – and sometimes this is lowered to a legal requirement that the clinician establish a professional relationship with the patient prior to treating, and this can be done in a variety of ways)
  • The need for an appropriate prior good faith examination (and in some states this must be in person and/or delegated to an appropriate licensed healthcare professional under physician supervision or collaboration) vs. a digital or electronic examination.

We also talked about scope of practice issues Joe may face as a chiropractor practicing functional medicine.

Yet another issue, which we address elsewhere, is whether Joe can profit from a markup on the services of the naturopathic physician, or whether this would simply be seen as disguised kickback or fee-splitting arrangement – or perhaps trigger a corporate practice of medicine violation.

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Prescribing through telemedicine increases legal risk

If an MD or ND is involved in a telemedicine practice, then prescribing raises additional legal risk.

Historically, enforcement authorities viewed “prescribing via the Internet” as a legal tripwire.  These were earlier days of the Web, and prescribing without seeing the patient in person (and particularly across states) was particularly forbidden.

In fact, the case of Hagseth v. Superior Court showcased the law’s concern about telemedicine, when a Colorado licensed medical doctor prescribed for a California resident, relying on an online questionnaire.  The patient died.  The physician was subject to criminal enforcement for unlawful practice of medicine in Colorado.

This idea, that prescribing “solely on the use of an electronic questionnaire” is dangerous to patients, is embedded in much of early telemedicine law, and remember that telemedicine law is not that old.

Some states are more liberal with respect to telemedicine prescribing, while many others still incorporate the basic prohibition and also require that an in-person exam be conducted.

For example, under California law, prescriptions via telemedicine are governed by California Business & Professions Code 2242 which states that “no person may prescribe, dispense or furnish dangerous drugs or devices via the Internet without an appropriate prior examination and medical indication therefor”.

Legal boundaries and regulatory enforcement vary by state, and, are changing all the time.

Some states accept electronic prescriptions from out of state physicians which comply with federal requirements (21 CFR Parts 1300, 1304, 1306 and 1311 et seq.), provided valid ID and verification by the pharmacist is obtained.

On its webpage describing telemedicine, the California Medical Board (CMB) appears to default to the standard of care as the test as to whether telemedicine is permissible; however, on its webpage concerning Internet prescribing, CMB states that the law prohibits prescribing, without an “appropriate prior examination,” notwithstanding that standard of care may be satisfied or that it might be considered within the range of acceptable professional practice by peers not to have an in person exam (for example, in some tele-dermatology).  On this page, CMB cites California Business & Professions Code, Section 2242.

Notably, as of October 11, 2019, the California legislature amended and liberalized Section 2242 via AB 1264, to provide that an appropriate prior examination does not require a synchronous interaction between the patient and the licensee and can be achieved through the use of telehealth, as specified, provided that the licensee complies with the appropriate standard of care.  Thus, 2242 now provides:

“Prescribing, dispensing, or furnishing dangerous drugs as defined in Section 4022 without an appropriate prior examination and a medical indication, constitutes unprofessional conduct. An appropriate prior examination does not require a synchronous interaction between the patient and the licensee and can be achieved through the use of telehealth, including, but not limited to, a self-screening tool or a questionnaire, provided that the licensee complies with the appropriate standard of care.”

Cal. Bus. And Professions Code § 2242.

Yet even so, there are also standard of care concerns, as noted in a 2019 disciplinary action by the Medical Board of California entitled, In re Richard J. Holmes, M.D

Some Telehealth Legal Strategies & Solutions

Some of the solutions that clinicians attempt to employ are these:

  • Avoid telemedicine in states with very tough telemedicine laws for out-of-state physicians.
  • When creating a telemedicine practice, limit prescribing (and especially beware prescribing controlled substances).
  • Provide only consulting services to physicians and licensed practitioners in the remote state, but not direct patient care services to patients in the remote state.
  • Obtain a “special purpose” or “limited telemedicine” license in the remote state.
  • Style the remote state practice as “health coaching” and limit advice to education and information.

Obviously, when designing a legal strategy, it’s a mistake to assume that something you hear from another practitioner who heard it from someone else’s attorney who heard it at a conference … or some variation … is actually what the law says and how it might apply to your situation.

In fact, the best practice is to contact an experienced healthcare lawyer who understands telemedicine law, and can advise you on how to navigate telehealth law requirements specific to your business or practice plan.

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