BILL ANALYSIS
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|Hearing Date: June 8, 2009 |Bill No:AB |
| |252 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Gloria Negrete McLeod, Chair
Bill No: AB 252Author:Carter
As Introduced: February 11, 2009 Fiscal: Yes
SUBJECT: Practice of medicine: cosmetic surgery: employment of
physicians and surgeons.
SUMMARY: Authorizes the revocation of the license of a physician
and surgeon who practices medicine with a business organization
that offers to provide or provides outpatient elective cosmetic
medical procedures or treatments (cosmetic procedures), as defined,
knowing that the practice is owned or operated in violation of the
prohibition against the corporate practice of medicine (CPM);
states that a physician and surgeon who contract to serve as, the
medical director of a business organization that he or she does not
own and that offers to provide or provides outpatient cosmetic
procedures that may only be provided by the holder of a valid
physician's and surgeon's certificate under this bill is deemed to
have knowledge that the business organization is in violation of
the prohibition against the CPM; provides that a business
organization that offers to provide, or provides cosmetic
procedures, that is owned or operated in violation of the
prohibition against the CPM, and that contracts with, or otherwise
employs, a physician and surgeon to facilitate its offers to
provide, or the provision of, cosmetic procedures that may only be
provided by the holder of a valid physician's and surgeon's
certificate is guilty of violation of the prohibition against
knowingly making or causing to be made any false or fraudulent
claims for payment of a health care benefit.
Existing law:
1)Requires any person who practices medicine to hold a valid
certificate to practice medicine. Establishes the Medical Board
of California (MBC) to license and certify physicians and
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surgeons.
2)Prohibits corporations and other artificial legal entities from
having any medical professional rights, privileges, or powers
(known as the "prohibition against the corporate practice of
medicine.") However, further provides that the Division of
Licensing of the MBC may, pursuant to regulations it has adopted,
grant approval for the employment of physicians and surgeons on a
salary basis by a licensed charitable institution, foundation, or
clinic if no charge for professional services rendered to
patients is made by that institution, foundation, or clinic.
Provides other certain exceptions to the prohibition against the
corporate practice of medicine.
3)Makes it unprofessional conduct for any licensee to violate or
attempt to violate, to assist in or abet the violation of, or to
conspire to violate the prohibition against the CPM. Requires
the MBC to take action against any licensee who is charged with
unprofessional conduct. Specifies the types of actions that
constitute unprofessional conduct.
4)Requires the MBC in conjunction with the Board of Registered
Nursing (BRN), and in consultation with the Physician Assistant
Committee (PAC) and professionals in the field, to review issues
and problems relating to the use of laser or intense light pulse
devices for elective cosmetic procedures by physicians and
surgeons, nurses, and physician assistants.
5)Specifies that the review conducted by the MBC, the BRN and the
PAC shall include the appropriate level of physician supervision
needed, the appropriate level of training to ensure competency,
guidelines for standardized procedures and protocols that address
patient selection, education, instruction and informed consent,
use of topical agents, and procedures to be followed in the event
of complications or side effects from treatment and procedures
for governing emergency and urgent care situations.
6)Requires the MBC and the BRN to promulgate regulations to
implement changes determined to be necessary with regard to the
use of laser or intense pulse light devices for elective cosmetic
procedures by physicians and surgeons, nurses and physicians
assistants.
7)Makes it unlawful to knowingly make or cause to be made any false
or fraudulent claim for payment of a health care benefit.
Specifies that any person who violates this provision is guilty
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of a public offense. States that when the claim or amount at
issue exceeds $400, the offense is punishable by imprisonment in
the state prison for 2, 3, or 5 years, or by a fine not to exceed
$50,000; if a claim or amount at issue is $400 or less, the
offense is punishable by imprisonment in a county jail not to
exceed six months, or by a fine of not more than $1,000 or by
both.
8)Defines cosmetic surgery for purposes of health insurance and
health plan coverage as any surgery that is performed to alter or
reshape normal structures of the body in order to improve the
patient's appearance.
This bill:
1)Authorizes the revocation of the license of a physician and
surgeon who practices medicine with a business organization that
offers to provide, or provides outpatient elective cosmetic
procedures, knowing that it is owned or operated in violation of
the prohibition against the CPM. Provides that a physician and
surgeon who contracts to serve as, or otherwise allows himself or
herself to be employed as, the medical director of a business
organization that he or she does not own and that offers to
provide or provides outpatient elective cosmetic procedures or
treatments that may only be provided by the holder of a valid
physician's and surgeon's certificate is deemed to have knowledge
that the business organization is in violation of the prohibition
against the CPM.
2)Provides that a business organization that offers to provide, or
provides, outpatient elective cosmetic medical procedures or
treatments, that is owned or operated in violation of the CPM,
and that contracts with, or otherwise employs, a physician and
surgeon to facilitate its offers to provide, or the provision of,
cosmetic procedures that may only be provided by the holder of a
valid physician's and surgeon's certificate is guilty of
violating the prohibition against knowingly making or causing to
be made any false or fraudulent claim for payment of a health
care benefit.
3)Defines "outpatient elective cosmetic procedures or treatments"
as a medical procedure or treatment that is performed to alter or
reshape normal structures of the body solely in order to improve
appearance.
FISCAL EFFECT: According to the Assembly Appropriations Committee
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analysis, "Unknown, likely minor increases in MBC enforcement
workload and fines related to violations of Corporate Practice of
Medicine prohibitions."
COMMENTS:
1.Purpose. The American Society for Dermatologic Surgery
Association (ASDSA), the Sponsor of this measure, indicates that
this bill provides the MBC and other consumer protection agencies
with enhanced enforcement tools necessary to pursue
well-resourced corporate entities unlawfully practicing medicine
through exotic, complicated and illegal business arrangements
with "employed" or "contracted" physicians. The Sponsor points
out that this bill puts physicians who aid and abet the unlawful
invasion of the practice of medicine on zero-tolerance notice
regarding such conduct. This bill strengthens enforcement of
current laws and going after the most frequent and pernicious
offenders, those unlawful, corporate-owned, chain med-spa
operators who want to practice medicine without proper licensure
or ownership structure. The ASDSA argues that medical spa chains
have created business management and franchising schemes that
involve hiring "medical directors" who serve as "consultants" for
the medical spas to get around the prohibition against the CPM.
ASDSA opines that several large, corporate laser and medical spa
chains operate in flagrant violation of the prohibition against
the CPM because penalties are minor costs of doing business.
2.Background.
a) Popularity of cosmetic procedures. Newspaper articles
provided by the sponsor claims that the number of Americans
undergoing cosmetic procedures, including chemical peels,
laser procedures, Botox shots, and wrinkle-filler injections
continue to rise. According to the American Society of
Plastic Surgeons ' (ASPS) website, there were 12 million
cosmetic surgeries performed in 2007, which represents a 7%
increase from 2006, and a 59% increase from 2000. ASPS
indicates that the top five surgical procedures were breast
augmentation (348,000, up 6%), liposuction (302,000,
unchanged), nose reshaping (285,000, down 7%), eyelid surgery
(241,000, up 3%), and tummy tuck (148,000, up 1%). Moreover,
ASPS points out that minimally-invasive cosmetic procedures
rose by 9%, to nearly 10 million procedures in 2007.
Hyaluronic acid fillers, popularly known as Restylane,
Hylaform, Hylaform Plus, and JuvedermTM, jumped from fifth
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most popular in 2006 to second most popular in 2007. The top
five minimally-invasive procedures were Botox (4.6 million, up
13 percent from 2006), hyaluronic acid fillers (1.1 million,
up 35 percent), chemical peel (1 million, down 4 percent),
laser hair removal (906,000, up 2 percent) and
microdermabrasion (897,000, up 10%).
b) Medical Spas. The increasing popularity of cosmetic
procedures or treatments, and the lucrative business they
offer have given rise to a new model of providing cosmetic
services outside the traditional physician settings and into
malls and local spas. Medical spas or popularly known as
"medspas" are increasingly becoming the destination for
various cosmetic procedures or treatments.
Recognizing the growing popularity of medical spas, the MBC has
posted on its website a fact sheet. The fact sheet indicates
that "medical spas are marketing vehicles for medical
procedures. If they are offering medical procedures, they
must be owned by physicians. The use of the term 'medical
spa' is for advertising purposes to make the procedures seem
more appealing. In reality, however, it is the practice of
medicine. There is no harm in seeking pampering or in wanting
to look better. A visit to a spa may provide a needed respite
from our stressful lives, and treatments that make us look
better often make us feel better. The Medical Board, however,
is concerned when medicine is being marketed like a pedicure,
and consumers are led to believe that being injected, lasered,
and resurfaced requires no more thought than changing hair
color. According to the MBC's fact sheet, cosmetologists,
while licensed professionals and highly qualified in
superficial treatments such as facials and microdermabrasion,
may never inject the skin, use lasers, or perform
medical-level dermabrasion or skin peels. Those types of
treatments must be performed by qualified medical personnel.
In California, that means a physician, or a registered nurse
or physician's assistant under the supervision of a physician.
Patients must know the qualifications of persons to whom they
are entrusting their health. Those seeking cosmetic
procedures or treatments should know that the person
performing them is medically qualified and experienced."
3.Corporate Practice of Medicine (CPM) Prohibition. According to
the MBC's website, medical spas that offer medical procedures or
treatments involve the practice of medicine and must be performed
and owned by physicians. The CPM doctrine generally prohibits
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corporations or other entities that are not controlled by
physicians from practicing medicine to ensure that lay persons
are not controlling or influencing the professional judgment and
practice of medicine by licensed physicians and surgeons. In an
effort to ensure medical spas are not violating the CPM doctrine,
one of the recommendations put forth by the MBC and BRN is to
give a higher priority to the investigation of corporate practice
of medicine violations in the medical spa clinics or other
settings using laser or intense pulse light devices and the
re-establishment of the Operation Safe Medicine Unit within the
MBC.
4.Recent Review by the MBC, BRN and PAC of Issues Involving Use of
Certain Cosmetic Procedures. SB 1423 (Figueroa) Chapter 873,
Statutes of 2006, required the MBC in conjunction with BRN to
promulgate regulations on or before January 1, 2009 to implement
changes relating to the use of laser or intense pulse light
devices for cosmetic procedures. The MBC and the BRN have held
meetings, discussions and heard testimony from a number of
organizations representing nurses, physicians, physician
assistants, patients and the laser industry. The discussions
included recommendations on training of personnel that use laser
equipments, the appropriate level of physician supervision at
these facilities, the appropriate advertising to inform patients
of the practitioners' credentials and degrees, who should own or
control these facilities, liability and establishing standardized
procedural rules. The discussions and meetings revealed that
there is frequent disregard of the law in the use of laser or
intense pulse light devices in the treatment of patients.
One of the recommendations from MBC and BRN was the reestablishment
of the Operation Safe Medicine Unit (Unit). The Unit was
established in 2000 by MBC as an enforcement program dedicated to
investigating the unlicensed practice of medicine, unlicensed
medical clinics and unlicensed persons soliciting patients. In
addition, two statements were approved by both boards; the first
outlines the responsibilities of physicians in cosmetic
procedures, including the supervision of allied health staff
performing laser procedures, and the second is a revised
statement to better inform consumers on cosmetic procedures,
currently available on MBC's website but includes the following:
"An appropriate examination must be conducted before treatments
are performed. This exam must be conducted by a physician, or
the doctor may delegate the examination to licensed nurse
practitioners or physician assistants. Physicians may not
delegate this examination to registered nurses."
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5.Prior Efforts Dealing with Cosmetic Surgery Practices. In
California, cosmetic surgery can be performed by any licensed
physician, from a plastic surgeon to a pediatrician. Many
physicians, who may or may not be trained in cosmetic procedures,
are conducting increasingly complex procedures in settings
outside of hospitals such as outpatient surgery centers and
doctors' offices. It is also common for doctors performing
complex cosmetic surgeries to receive their only training from
weekend courses or instructional videos. Currently, there are no
uniform standards for physicians' training related to cosmetic
surgery. The Legislature attempted to regulate the practice of
cosmetic surgery in previous years with the introduction of
several bills including:
a) SB 1423 (Figueroa) Chapter 873, Statutes of 2006, required
the MBC in conjunction with the Board of Registered Nursing to
promulgate regulations on or before January 1, 2009 to
implement changes relating to the use of laser or intense
pulse light devices for cosmetic procedures by physicians and
surgeons, nurses, and physician assistants.
b) SB 835 (Figueroa) of 1999, would have enacted the Cosmetic
Surgery Patient Disclosure Act, which would have required
physicians who perform cosmetic surgery, as defined, to
provide the MBC with specified information, including
training, board certifications, and number of procedures
performed, and requires the MBC to make this information
available to the public upon request and post the information
on the internet. SB 835 was vetoed by then Governor Davis who
indicated that the methods prescribed by the measure were
unduly burdensome.
c) SB 836 (Figueroa) Chapter 856, Statutes of 1999, expanded
and revised the prohibition against fraudulent advertising by
health practitioners.
d) SB 837 (Figueroa) of 1999, would have required cosmetic
surgery procedures to be performed in a licensed acute care
hospital or in a licensed or accredited outpatient surgery
setting. SB 837 died in the Assembly Appropriations
Committee.
6.Similar Legislation this Session. SB 674 (Negrete McLeod) has
passed the Senate Flloor and is on the way to the Assembly; and,
among other provisions requires the MBC to adopt regulations on
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or before July 1, 2011 on the appropriate level of physician
availability necessary within clinics using laser or intense
pulse light devices for elective cosmetic surgery. Requires the
MBC to post on its Internet Website a fact sheet to educate the
public about cosmetic surgery, and the risks involved with such
surgeries. Makes a number of changes regarding the approval,
oversight and inspection of outpatient settings, as defined, by
the MBC and accreditation agencies approved by the MBC, and in
developing a plan of corrective action for any deficiencies found
by the accreditation agencies or the MBC during inspections or
otherwise. Includes in the existing law definition of outpatient
settings fertility clinics that offer in vitro fertilization or
assisted reproduction technology (ART) treatments.
7.Prior Legislation.
a) AB 2398 (Nakanishi) of 2008, is substantially similar to
the provisions of this bill, and would have authorized the
revocation of the license of a physician and surgeon who
practices medicine with a business organization that provides
outpatient elective cosmetic medical procedures or treatments.
AB 2398 failed passage on the Senate Floor.
b) AB 2968 (Carter) of 2008 would have enacted the Donda West
Law, which would prohibit elective cosmetic surgery on a
patient unless, prior to surgery, the patient has completed a
physical examination by, and has received written clearance
for the procedure from, a licensed physician and surgeon. AB
2968 was vetoed by Governor Schwarzenegger because of the
State budget crisis.
c) SB 1454 (Ridley-Thomas) would have required for purposes of
advertising that a health care practitioner, as specified,
provide the type of license under which the licensee is
practicing and the type of degree received upon graduation
from professional training and that a health care practitioner
who is practicing in an outpatient setting, as defined, and to
wear a name tag which includes his or her name and their
license status. Requires the MBC to adopt regulations on the
appropriate level of physician supervision necessary within
clinics using laser or intense pulse light devices for
elective cosmetic surgery, and that the MBC establish as one
of its priorities the investigation of unlicensed activity
within such clinics by reestablishment of the Operation Safe
Medicine Unit (Unit). Requires the MBC to post on its website
a fact sheet to educate the public about cosmetic surgery, and
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the risks involved with such surgeries. Makes a number of
changes regarding the approval, oversight and inspection of
outpatient settings, as defined, by the MBC and accreditation
agencies approved by the MBC, and in developing a plan of
corrective action for any deficiencies found by the
accreditation agencies or the MBC during inspections, or
otherwise. SB 1454 died on the Assembly Floor.
8.Arguments in Support. Supporters, including the American Academy
of Dermatology Association , California Society for Dermatology
and Dermatologic Surgery, and the California Society of Plastic
Surgeons, indicate that this bill offers an appropriate penalty
for physicians who knowingly allow their names to serve as a
"front" for a corporation that operates medical spas.
9.Arguments in Opposition. The Department of Consumer Affairs
argues that this bill is duplicative of existing law and is
unnecessary. It points that that the MBC and the BRN recently
completed a task force on the use of lasers and found that
diligent enforcement of violations of the prohibition against the
CPM and violations of nurses' and physician assistants' scopes of
practice will deter illegal action by medical spas.
SUPPORT AND OPPOSITION:
Support:
American Society for Dermatologic Surgery Association (Sponsor)
American Academy of Dermatology Association
American Academy of Facial Plastic and Reconstructive Surgery
American Federation of State, County, and Municipal Employees
California Academy of Eye Physicians and Surgeons
California Academy of Physician Assistants
California Medical Association
California Society of Dermatology and Dermatologic Surgery
California Society of Plastic Surgeons, Inc
Medical Board of California
Various individuals, including physicians
Opposition:
Department of Consumer Affairs
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Consultant:Rosielyn Pulmano