California law now includes increased penalties for medical spa owners who violate the corporate practice of medicine and engage in unlicensed medical practice.
Assembly Bill 1548, amends Section 2417.5 to the Business and Professions Code, relating to the practice of medicine. The new legislation increases the penalties for violating the corporate practice of medicine and engaging in (or aiding and abetting) unlicensed medical practice:
AB 1548 raises the fine to a maximum of $50,000 or double the amount of fraud, whichever is greater, and institutes a maximum sentence of two- to five-years in state prison.
Popular medi-spas that provide a variety of non-surgical cosmetic procedures such as laser skin resurfacing, cellulite treatments and dermal fillers in surgery centers and doctors’ offices are the primary target of the bill. The employees who provide the services are medical doctors who may — or may not — have been formally trained in cosmetic procedures, and other health professionals who have been trained by a supervising medical doctor.
The legislative counsel’s digest states:
Practice of medicine: cosmetic surgery: employment of physicians and surgeons.
Existing law, the Medical Practice Act, establishes the Medical Board of California within the Department of Consumer Affairs, which licenses physicians and surgeons and regulates their practice. The Medical Practice Act restricts the employment of licensed physicians and surgeons and podiatrists by a corporation or other artificial legal entity, subject to specified exemptions. Existing law makes it unlawful to knowingly make, or cause to be made, any false or fraudulent claim for payment of a health care benefit, or to aid, abet, solicit, or conspire with any person to do so, and makes a violation of this prohibition a public offense.
This bill, with respect to a business organization that provides outpatient elective cosmetic medical procedures or treatments, that is owned and operated in violation of the prohibition against employment of licensed physicians and surgeons and podiatrists, and that contracts with or employs these licensees to facilitate the offer or provision of procedures or treatments that may only be provided by these licensees, would make that business organization guilty of a violation of the prohibition against knowingly making or causing to be made any false or fraudulent claim for payment of a health care benefit. The bill would prohibit construing its provisions to alter or apply to any arrangements currently authorized by law. Because the bill would expand a public offense, it would impose a state-mandated local program.
This bill would state that its provisions are declaratory of existing law. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
See also California Steps Up Enforcement with New Law Targeting Medical Spa Treatments: Part 2 (Corporate Practice of Medicine Issues; Legal Strategies)
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