The Illinois Attorney General has filed a lawsuit against Nu U Medical Spas in the Chicago area. The issues presented are remarkably similar to many medical spas owned by non-physicians. This case should be a warning to many in the industry.
The suit alleges that Nu U utilized deceptive marketing and that it is performing unsupervised medical treatments. One of the concerns was over the spas’ use of Lipodissolve to “melt” fat. There are many issues with the use of Lipodissolve but the lawsuit focuses upon the fact that it is not FDA cleared and many organizations such as the American Academy of Dermatology, The American Society for Dermatologic Surgery and the American Society for Plastic Surgery do not condone use of the product. There is little evidence to support its use and a lot of evidence that it does little, if anything.
However, the main issue that I want to discuss is one that affects many medical spas, especially the non-physician owned ones. Lipodissolve is an injected treatment, it requires a physician’s order, but Nu U allegedly administers the fat-reducing treatment without a doctor’s order. Many non-physician owned medical spas have non-medical personal injecting dermal fillers such as Botox Cosmetic, Restylane, Juvederm and Collagen without a doctor’s order. In fact, more often than not a doctor does not even see the patient prior to the procedure. In The Nu U matter, the Attorney General found that fact despite its outward claims, Nu U allegedly “fails altogether to monitor and evaluate patients by licensed physicians.”
Another interesting aspect of the case is something that I routinely blog about: The corporate practice of medicine. The Illinois Attorney General argues that the Nu U Medical Spas have violated the Illinois Corporate Practice of Medicine Statute. Forty-five of the fifty states have such statutes and they are violated openly and routinely. These are serious statutes with severe criminal and civil penalties and I am at a loss to figure out why so many violate these statutes on a daily basis. Oops, I do know why…it is called profit!!
Join an experienced health care attorney and medical spa expert as we navigate through the quagmire of state and federal regulations regarding this industry.
Tuesday, July 26, 2011
Saturday, July 23, 2011
When May Physicians Introduce New Technology to Patients??
I recently blogged about stem cell applications and it is prudent to discuss an issue that applies to any new medical technology and advancements. The question is: “when can I as a medical provider, introduce new technology, especially if it is not yet FDA cleared”?
This is a very important question. The answer is difficult and there are never any guaranteed correct answers. The law in the USA is typically a moving target. For one thing, the law necessarily lags behind technology (in every aspect of technology – not just medicine). However, medicine is a bit different because we have the FDA to protect patients and provide a process for clearing products and services for treatment. The problem is that it is a time consuming process.
This discussion starts with the fact that the FDA does not have jurisdiction over physicians. It regulates devices and products and the claims that may (or may not) be made about them. The FDA cannot interfere with the physician’s “independent medical judgment”. Accordingly, physicians are free to utilize a product or a device in a manner that they believe will prove beneficial for a patient. They must uphold their Hippocratic Oath to “do no harm” and clearly, the physician should be able to indicate and articulate why the treatment or procedure was performed on a patient.
A physician should study the science and if he or she reasonably concludes that this treatment or product will benefit the patient within the physician independent medical judgment, then it may be acceptable to perform the treatment or procedure. It would also be beneficial to illustrate that peers are doing it as well to help indicate a standard of care for the particular use.
The problem with a new, non-FDA cleared treatment is the marketing of it. The internet has made it easier for patients to find you but it has also made it easier for the FDA to find you! It is tricky and difficult to market new technology, but as I am known to say, “There is always a way!”
This is a very important question. The answer is difficult and there are never any guaranteed correct answers. The law in the USA is typically a moving target. For one thing, the law necessarily lags behind technology (in every aspect of technology – not just medicine). However, medicine is a bit different because we have the FDA to protect patients and provide a process for clearing products and services for treatment. The problem is that it is a time consuming process.
This discussion starts with the fact that the FDA does not have jurisdiction over physicians. It regulates devices and products and the claims that may (or may not) be made about them. The FDA cannot interfere with the physician’s “independent medical judgment”. Accordingly, physicians are free to utilize a product or a device in a manner that they believe will prove beneficial for a patient. They must uphold their Hippocratic Oath to “do no harm” and clearly, the physician should be able to indicate and articulate why the treatment or procedure was performed on a patient.
A physician should study the science and if he or she reasonably concludes that this treatment or product will benefit the patient within the physician independent medical judgment, then it may be acceptable to perform the treatment or procedure. It would also be beneficial to illustrate that peers are doing it as well to help indicate a standard of care for the particular use.
The problem with a new, non-FDA cleared treatment is the marketing of it. The internet has made it easier for patients to find you but it has also made it easier for the FDA to find you! It is tricky and difficult to market new technology, but as I am known to say, “There is always a way!”
Friday, July 22, 2011
Stem Cell Applications: Fact or Fiction
Since I am also a scientist involved in stem cell and DNA applications, many people ask me for guidance on these subjects. There are already many stem cell treatments and applications. There are many valuable treatments with stem cells. There are SOME topical stem cell products that have promise and value. One such product is SCM Forte Many others are hype such as those that are "phyto" based. Folks, "phyto" is plant derived stem cells and there is less than ZERO evidence that these are efficacious in humans. These are shameless attempts to cash in on a trend.
There are many treatments in which stem cells have a lot of promise. There are over 220 applications for stem cells in the human genome. There are three basic ways in which stem cells are introduced to humans: oral capsules, injection intra muscular and injection at point of need/trauma. There are also multiple forms of stems cells - too many to list and the answer to which treatment is best depends upon what you are treating, how the cells were extracted and amplified and the source of the stem cells.
There is a lot of unfounded hype about treatments. I travel frequently and I can tell you that in other countries, people are paying bookoo bucks for worthless treatments. Most of the cells are worthless or not efficacious in the human genome. They also may not have been extracted properly or amplified in a lab properly. There are also many companies and medical practices that are unabashedly thumbing their noses at the FDA as they promote useless treatments and make totally unsubstantiated claims.
There is no question that stem cells will be the next wave of medical breakthrough. The do work and can literally repair anything in the human genome. However, the challenge will be to separate fact from fiction. If you are thinking of incorporating stem cell products or treatments into your center, call me and review the science.
There are many treatments in which stem cells have a lot of promise. There are over 220 applications for stem cells in the human genome. There are three basic ways in which stem cells are introduced to humans: oral capsules, injection intra muscular and injection at point of need/trauma. There are also multiple forms of stems cells - too many to list and the answer to which treatment is best depends upon what you are treating, how the cells were extracted and amplified and the source of the stem cells.
There is a lot of unfounded hype about treatments. I travel frequently and I can tell you that in other countries, people are paying bookoo bucks for worthless treatments. Most of the cells are worthless or not efficacious in the human genome. They also may not have been extracted properly or amplified in a lab properly. There are also many companies and medical practices that are unabashedly thumbing their noses at the FDA as they promote useless treatments and make totally unsubstantiated claims.
There is no question that stem cells will be the next wave of medical breakthrough. The do work and can literally repair anything in the human genome. However, the challenge will be to separate fact from fiction. If you are thinking of incorporating stem cell products or treatments into your center, call me and review the science.
Thursday, July 21, 2011
Physician Delegation Principles in Medical Spas and Aesthetic Medicine
It seems that my blogs regarding esthetician injectors of Botox® Cosmetic and dermal fillers such as Restylane® and Juvéderm® have become a contemptuous topic of conversation. I received a call from a cosmetic surgeon in Texas and this prompted me to further elaborate on the issue that I have presented. Accordingly, I wanted to elaborate.
The first area of explanation is that there is no license in any state for a “medical aesthetician”. It is a term that was created several years ago to identify estheticians working in a medical setting (physician office or hospital). I have advocated that estheticians not utilize the term because it is arguably deceptive. The public (the clients and patients) would likely believe that a person utilizing this term has higher scope of practice and can perform more medically oriented procedures. The Federal Trade Commission (FTC) has addressed issues such as this in the past and it consistently maintains that utilization of such terms is deceptive to the public.
Additionally, in most states, the esthetician license is not recognized in a medical practice or hospital. Most boards of cosmetology maintain that a physician is not the appropriate supervisor for cosmetology. Accordingly, estheticians working in most medical settings are doing so under the physician delegation principles within the particular state.
States have varying regulations on physician delegation. Arguably in some instances and in some states, a physician could delegate any medical procedure to any individual. However, this rationale is based upon state delegation laws. Federal law would prohibit much of the conduct that we are experiencing in the medical aesthetics area. I hesitate to even utilize the term “federal law” in this regard because it is not so much a particular regulation or statute that is a problem. The federal issues are the Food and Drug Administration (FDA) and Federal Trade Commission (FTC) that are at issue. The brief explanation of why estheticians and others are not able to inject Botox Cosmetic and dermal fillers such as Restylane and Juvederm is that in the case of Botox Cosmetic, it is a prescription drug and in the case of the dermal fillers, they are medical devices. Injectors are also utilizing syringes and exposing the patient to a potential for bleeding and these additional issues necessarily mandate that estheticians not inject substances.
The first area of explanation is that there is no license in any state for a “medical aesthetician”. It is a term that was created several years ago to identify estheticians working in a medical setting (physician office or hospital). I have advocated that estheticians not utilize the term because it is arguably deceptive. The public (the clients and patients) would likely believe that a person utilizing this term has higher scope of practice and can perform more medically oriented procedures. The Federal Trade Commission (FTC) has addressed issues such as this in the past and it consistently maintains that utilization of such terms is deceptive to the public.
Additionally, in most states, the esthetician license is not recognized in a medical practice or hospital. Most boards of cosmetology maintain that a physician is not the appropriate supervisor for cosmetology. Accordingly, estheticians working in most medical settings are doing so under the physician delegation principles within the particular state.
States have varying regulations on physician delegation. Arguably in some instances and in some states, a physician could delegate any medical procedure to any individual. However, this rationale is based upon state delegation laws. Federal law would prohibit much of the conduct that we are experiencing in the medical aesthetics area. I hesitate to even utilize the term “federal law” in this regard because it is not so much a particular regulation or statute that is a problem. The federal issues are the Food and Drug Administration (FDA) and Federal Trade Commission (FTC) that are at issue. The brief explanation of why estheticians and others are not able to inject Botox Cosmetic and dermal fillers such as Restylane and Juvederm is that in the case of Botox Cosmetic, it is a prescription drug and in the case of the dermal fillers, they are medical devices. Injectors are also utilizing syringes and exposing the patient to a potential for bleeding and these additional issues necessarily mandate that estheticians not inject substances.
Tuesday, July 19, 2011
AGGGHHHHH More Esthecians Trying to Inject Botox and Dermal Fillers
This topic just will NOT go away!!! Where is this coming from all of a sudden. Today, I was minding my own business (admittedly a rarity). I was receiving a far infra red body wrap at a Las Vegas facility. I brought the July issue of Dermascope - a reputable medical aesthetic magazine. I noted an article written by a "medical aesthetician" so that immediately caught my attention because the law does not make the distinction between and esthetician and a medical esthetician. I have blogged about this frequently. In fact, calling yourself that can violate FTC guidelines and state board of cosmetology and medicine mandates. Arguably you are deceiving the public by calling your self that since it is not a higher license and does not allow you to perform additional services.
Then my knickers really got into a bunch when I read the article! The author incorrectly asserts that estheticians can perform ablative laser, dermal filler (Restylane, Collagen, Juvederm) and Botox injections! Hey, folks, I taught at a premier cosmetology school and I can tell you that the depth of knowledge and experience of the vast majority of estheticians is NOT appropriate for these types of treatments. In any event, it is NOT legally supportable for them to do these procedures!! They cannot practice medicine. They cannot dispense prescription drugs or provide medical devices and they cannot operate a laser (except in limited situations). I actually pioneered the ability of esteticians to perform laser hair removal in New Jersey many years ago.
I am actually taking the time and trouble to send Dermascopes editors a letter about this. If enough people read things like this, they will believe that it is acceptable for estheticians to practice medicine.
I do not know where all of this is coming from nor do I know why it is suddenly so prevalent. As I mentioned in an earlier blog, in the past two weeks, I received calls from doctors in Texas, Nevada and Colorado about this. Now, I read this article that would have many believe that estehticians can inject Botox, dermal fillers such as Restylane and Juvederm and perform laser treatments.
Then my knickers really got into a bunch when I read the article! The author incorrectly asserts that estheticians can perform ablative laser, dermal filler (Restylane, Collagen, Juvederm) and Botox injections! Hey, folks, I taught at a premier cosmetology school and I can tell you that the depth of knowledge and experience of the vast majority of estheticians is NOT appropriate for these types of treatments. In any event, it is NOT legally supportable for them to do these procedures!! They cannot practice medicine. They cannot dispense prescription drugs or provide medical devices and they cannot operate a laser (except in limited situations). I actually pioneered the ability of esteticians to perform laser hair removal in New Jersey many years ago.
I am actually taking the time and trouble to send Dermascopes editors a letter about this. If enough people read things like this, they will believe that it is acceptable for estheticians to practice medicine.
I do not know where all of this is coming from nor do I know why it is suddenly so prevalent. As I mentioned in an earlier blog, in the past two weeks, I received calls from doctors in Texas, Nevada and Colorado about this. Now, I read this article that would have many believe that estehticians can inject Botox, dermal fillers such as Restylane and Juvederm and perform laser treatments.
Saturday, July 16, 2011
Folks, Estheticians Cannot Inject Botox and Dermal Fillers!!!
There seems to be a massive increase in the number of non-medical personnel injecting Botox® Cosmetic, dermal fillers such as JuveDerm, Collagen, Perlane, Hylaform and Restylane. There is a correspondingly huge increase in the arrogance with which such providers are maintaining that they are allowed to do this. In the past two weeks, I received contacts from physicians in New Jersey, Texas, Colorado, California and Nevada about the issue of estheticians injecting Botox® Cosmetic.
The argument that they are allowed to do this is that they are doing so under supervision of a physician. IF this is legally supportable, the non-medical personnel would have to be DIRECTLY employed by the physician and properly supervised by the physician. Remember that I stated “IF” this is legally supportable. Other times they are stating that the physician can DELEGATE this to the non-medical personnel. Again, “IF” this is legally supportable (and it isn’t), the injector would have to be directly employed by the physician and supervised by the physician. Additionally, it would be far more preferable if the injector was NOT and Independent Contractor of the physician. He or she should be an employee.
Realize that there are many issues presented here- not the least of which is insurance coverage. If an esthetician injects Botox® Cosmetic , Collagen, Restylane, Perlane, Hylaform, Juvederm etc., there is NO insurance coverage for this procedure!!
Another issue is that the esthetician license is frequently not recognized in the medical office. Accordingly, the esthetician is an unlicensed non-medical person performing medical treatments. Even in situations in which the esthetician license is recognized in a medical office, the scope of their license NEVER allows them to inject Botox® Cosmetic or dermal fillers.
So, let’s sum this up…non-medical personnel are injecting prescription drugs and medical devices through a syringe and there is no professional negligence coverage; and they are doing so outside the scope of their license. This is OK??? Really?? Guess what…it isn’t OK….for the simple reason that they are engaged in the “UNAUTHORIZED PRACTICE OF MEDICINE”!!!!! EVERY state prohibits this! EVERY STATE! The state Attorney General can prosecute such cases..wanna go there???
The argument that they are allowed to do this is that they are doing so under supervision of a physician. IF this is legally supportable, the non-medical personnel would have to be DIRECTLY employed by the physician and properly supervised by the physician. Remember that I stated “IF” this is legally supportable. Other times they are stating that the physician can DELEGATE this to the non-medical personnel. Again, “IF” this is legally supportable (and it isn’t), the injector would have to be directly employed by the physician and supervised by the physician. Additionally, it would be far more preferable if the injector was NOT and Independent Contractor of the physician. He or she should be an employee.
Realize that there are many issues presented here- not the least of which is insurance coverage. If an esthetician injects Botox® Cosmetic , Collagen, Restylane, Perlane, Hylaform, Juvederm etc., there is NO insurance coverage for this procedure!!
Another issue is that the esthetician license is frequently not recognized in the medical office. Accordingly, the esthetician is an unlicensed non-medical person performing medical treatments. Even in situations in which the esthetician license is recognized in a medical office, the scope of their license NEVER allows them to inject Botox® Cosmetic or dermal fillers.
So, let’s sum this up…non-medical personnel are injecting prescription drugs and medical devices through a syringe and there is no professional negligence coverage; and they are doing so outside the scope of their license. This is OK??? Really?? Guess what…it isn’t OK….for the simple reason that they are engaged in the “UNAUTHORIZED PRACTICE OF MEDICINE”!!!!! EVERY state prohibits this! EVERY STATE! The state Attorney General can prosecute such cases..wanna go there???
Thursday, July 14, 2011
Non-Physician Owned Medical Spas
It is really frustrating to see soooo many medical spas violating basic state and federal laws. I had occasion to visit a medspa in Las Vegas this week. I was SHOCKED at the number of state and federal violations I noticed. Medical assistants injecting Botox® cosmetic, non-licensed individuals operating a laser, equipment not available in the USA, and a “supervising” physician that has never been on the site!! In fact, a medical assistant should not be employed in that capacity by a non-physician owned medical spa!! It amazes me that there is so much clear violation of so many laws and the arrogance of those that defend the un-defendable when approached with the issues.
Compliance is on the rise and states, the FDA and other federal agencies are becoming more aware of the issues. Physicians are more aware of the duties and responsibilities of being a medical director or in medically supervising another facility.
Folks, it is time to wake up and appreciate that a non-physician owned medical spa is a huge concern, It is very difficult for such facilities to operate in any manner of compliance. They are called “medical” spas for a reason. I am not saying that it is impossible; but it is problematic!! Websites frequently provide so much information of violations that regulators would not even have to visit the site! Websites and advertising are the biggest source of compliance triggers. The facility that I visited this week had CLEAR indication that the physician was the owner of the medical spa!! AS I mentioned, the physician had never even been on the site!! Peer complaints are next – many of your peers will complain to the boards of cosmetology or medicine. The boards, by charter, must investigate EVERY complaint – no matter how deficient on its face. The cost of defending a compliance audit is HUGE and the fines and penalties are high. There is even criminal prosecution and loss of professional license possibilities. Yes, this does happen!!
Compliance is on the rise and states, the FDA and other federal agencies are becoming more aware of the issues. Physicians are more aware of the duties and responsibilities of being a medical director or in medically supervising another facility.
Folks, it is time to wake up and appreciate that a non-physician owned medical spa is a huge concern, It is very difficult for such facilities to operate in any manner of compliance. They are called “medical” spas for a reason. I am not saying that it is impossible; but it is problematic!! Websites frequently provide so much information of violations that regulators would not even have to visit the site! Websites and advertising are the biggest source of compliance triggers. The facility that I visited this week had CLEAR indication that the physician was the owner of the medical spa!! AS I mentioned, the physician had never even been on the site!! Peer complaints are next – many of your peers will complain to the boards of cosmetology or medicine. The boards, by charter, must investigate EVERY complaint – no matter how deficient on its face. The cost of defending a compliance audit is HUGE and the fines and penalties are high. There is even criminal prosecution and loss of professional license possibilities. Yes, this does happen!!
Tuesday, July 12, 2011
Part III of Issues Regarding the Resale Laser Market
This final blog in the resale laser market segment focuses on two related issues: Laser manufacturers’ refusal to service lasers and light based medical equipment sold on the resale market an restrictions on who may repair/service a medical aesthetic laser.
These policies and restrictions are violative of the restraint of trade provisions of the Sherman Anti-Trust Act and the Uniform Commercial Code. In many instances, an owner of a medical aesthetic laser or light device cannot obtain service on the device or they are able to obtain service but it is at an exorbitant price and discriminatory as indicated in the above discussion. In other instances, the owner of the device can get service, but the service technician is unable to obtain a needed part in order to repair the laser.
These policies violate the Sherman Act and/or the UCC and Robinson-Patman Act. An analogy would be that an owner of a used BMW cannot get service at a BMW dealership because they are not the original owner. Another analogy would be that a repair facility of choice cannot repair a BMW because the manufacturer will not provide the needed part for an arbitrary or less than legitimate business purpose. A third analogy would be that a BMW dealership has different parts or service pricing depending upon whether you are the original owner.
In all of these analogies, the conduct would violate the spirit and intent of the respective federal laws. Laser manufacturers are violating these concepts frequently and in most instances in which an owner is unable to purchase service or parts, or may otherwise do so at pricing levels higher than original owners.
I will conclude these issues by indicating that there are legitimate times when laser manufacturers refuse service or parts and I acknowledge this. However, there are far too many instances when the state and federal laws are violated without legitimate validation.
I would also like to indicate that many of the policies of laser manufacturers violate the financing agreements by and between the owner and the funding source for the acquisition. This is especially true when the manufacturer arranged for financing.
Finally, there are many state laws that would protect owners of aesthetic medical lasers. It is not possible to discuss all of these
These policies and restrictions are violative of the restraint of trade provisions of the Sherman Anti-Trust Act and the Uniform Commercial Code. In many instances, an owner of a medical aesthetic laser or light device cannot obtain service on the device or they are able to obtain service but it is at an exorbitant price and discriminatory as indicated in the above discussion. In other instances, the owner of the device can get service, but the service technician is unable to obtain a needed part in order to repair the laser.
These policies violate the Sherman Act and/or the UCC and Robinson-Patman Act. An analogy would be that an owner of a used BMW cannot get service at a BMW dealership because they are not the original owner. Another analogy would be that a repair facility of choice cannot repair a BMW because the manufacturer will not provide the needed part for an arbitrary or less than legitimate business purpose. A third analogy would be that a BMW dealership has different parts or service pricing depending upon whether you are the original owner.
In all of these analogies, the conduct would violate the spirit and intent of the respective federal laws. Laser manufacturers are violating these concepts frequently and in most instances in which an owner is unable to purchase service or parts, or may otherwise do so at pricing levels higher than original owners.
I will conclude these issues by indicating that there are legitimate times when laser manufacturers refuse service or parts and I acknowledge this. However, there are far too many instances when the state and federal laws are violated without legitimate validation.
I would also like to indicate that many of the policies of laser manufacturers violate the financing agreements by and between the owner and the funding source for the acquisition. This is especially true when the manufacturer arranged for financing.
Finally, there are many state laws that would protect owners of aesthetic medical lasers. It is not possible to discuss all of these
Sunday, July 10, 2011
Part II of a Review of the Resale (Used) Laser Issues
In regard to discriminatory pricing of laser parts and service, it has been customary for laser manufacturers and their suppliers to charge substantially different pricing to owners of resale medical aesthetic laser devices and other individuals and business entities. In my experience, I have noticed that same part have a cost of $100 to an original owner of a device, and a cost of $400 or more to a device owner that is not the original owner. This is not legally supportable. There appears to be wide-spread discriminatory pricing in the resale laser market.
The issue presented here is the anti-discrimination policies under Federal law. The Robinson-Patman Act of 1936 amended prior legislation to prohibit certain anti discriminatory practices of large businesses relative to smaller businesses. The Robinson-Patman Act is complex legislation and there are certainly situations in which pricing variations are legitimate and legally supportable. For example, if a buyer is purchasing in bulk, it would be expected that they receive volume pricing. A wholesaler would also expect to receive better pricing. However, in my experience, the activities of many laser manufacturers in this regard are clearly violative of the spirit and intent of the Act. There is no legitimate justification for the price variance that I have observed. The amount of variance is not justifiable.
There are also situations in this issue that may also violate the Uniform Commercial Code as adopted in all 50 states. It is difficult to discuss this in this forum because each state has adopted its own version of the UCC. It is important to note that the UCC, as adopted in each state, will have protections against this behavior as well.
Also, in regard to pricing of laser parts, in many instances the laser manufacturers will not supply parts to technician at any price. I am going to discuss this tomorrow in the third blog about used (resale) lasers.
The issue presented here is the anti-discrimination policies under Federal law. The Robinson-Patman Act of 1936 amended prior legislation to prohibit certain anti discriminatory practices of large businesses relative to smaller businesses. The Robinson-Patman Act is complex legislation and there are certainly situations in which pricing variations are legitimate and legally supportable. For example, if a buyer is purchasing in bulk, it would be expected that they receive volume pricing. A wholesaler would also expect to receive better pricing. However, in my experience, the activities of many laser manufacturers in this regard are clearly violative of the spirit and intent of the Act. There is no legitimate justification for the price variance that I have observed. The amount of variance is not justifiable.
There are also situations in this issue that may also violate the Uniform Commercial Code as adopted in all 50 states. It is difficult to discuss this in this forum because each state has adopted its own version of the UCC. It is important to note that the UCC, as adopted in each state, will have protections against this behavior as well.
Also, in regard to pricing of laser parts, in many instances the laser manufacturers will not supply parts to technician at any price. I am going to discuss this tomorrow in the third blog about used (resale) lasers.
Saturday, July 9, 2011
A Discussion of Laser Manufacturer Issues Relating to Used Lasers
There are numerous issues relating to the purchase and operation of medical aesthetic lasers on the resale market. This blog will serve as a general purpose letter to address the issues and provide a legal framework to resolve such issues. It is impractical and legally impossible to address specific issues relative to specific situations since the resolution of many medical aesthetic laser issues involves varying state and federal law as well as differing policies among laser vendors, laser manufacturers, purchasers, financing sources and state law. Each situation is unique and requires review and consideration of the principals discussed herein. The length is such that I will post this in three separate blogs.
Some background information is also necessary to provide additional insight into this opinion letter. I have been directly involved in the aesthetic laser industry for almost 20 years. My experience includes serving as general counsel to two laser manufacturers and as a consultant to a third. I have also served as CEO of a large dermatology and plastic surgery network and we directly or indirectly purchased literally thousands of aesthetic lasers and medical light based equipment. I have been an attorney for over 25 years and have multiple graduate and doctorate degrees in science as well.
The areas of focus of this letter are based in three issues:
1. Laser manufacturer requirement of certification of resale lasers;
2. Laser manufacturers’ arguably discriminatory pricing for parts;
3. Laser manufacturers’ refusal to service lasers and light based medical equipment sold on the resale market.
4. Restrictions on who may repair/service a medical aesthetic laser.
The certification requirement centers on an industry policy that mandates that a purchaser of “used” medical aesthetic laser must have the device certified in order for it to be repaired or serviced at a later date. Frequently, such certification comes at a very expensive price. Although this is a valid and legitimate business interest of the laser companies, the implementation of the legitimate polices is legally unsupportable in most instances.
The reason that many of such policies are not legally supportable is that such policies are arguably in restraint of trade and subject to review of the Sherman Anti-Trust Act. It is arguably restraint of trade to charge disproportionately high fees relative to the acquisition price of an aesthetic medical laser. Laser manufacturers charge varying fees for “certification” when in fact, the certification process is largely the same for most devices. The certification process entails inspection of the device in order to determine whether it has been altered, modified or otherwise changed from its original configuration. This certification process may also necessarily include inspection of computerized or automated sub systems of the device, such as a computerized scanner.
The prices charged for this service are frequently outrageous given the time and expense involved in the process. As I stated above, this is a legitimate business interest and concern for the laser manufacturer. However, they are charging exorbitant and inconsistent fees for this service. Since the certification is necessary in order for the new owner to service or maintain the device, then buyer is at a competitive disadvantage in such transactions. This situation requires that laser manufacturers avoid appearance of tactics that rise to the level of restraint of trade. It has also been my experience that laser manufactures will waive or reduce the certification fee arbitrarily and also in violation of the laws intended to protect such situations.
The Sherman Anti-Trust Act of 1890 is designed to prevent monopolistic trade practices and anti-competitive business behavior. The certification requirement is a legitimate business interest. However, the fees charged in many/most instances are violative of the spirit and intention of the Act. Many laser manufacturers have even restricted or prohibited its suppliers and vendors from supplying the parts and services to owners of resold medical aesthetic lasers. However, this right must be asserted by the supplier or vendor, but it does merit mentioning.
In fact, one prominent laser manufacturer suffered a decrease in its stock price in 2008 because analysts were concerned about restraint of trade issues.
Additionally, the certification raises issues under the Uniform Commercial Code (UCC). Many of the certification policies will violate the intent and spirit of the Uniform Commercial Code, especially Article 2 of the Code governing Sales. A more thorough discussion of this issue is not practical under the UCC because all 50 states have adopted the UCC in some form, but there are differences from state to state. However, it is important to note that in many of the certification issues that I have encountered (many), the UCC in its adopted form in various states, has been violated.
Some background information is also necessary to provide additional insight into this opinion letter. I have been directly involved in the aesthetic laser industry for almost 20 years. My experience includes serving as general counsel to two laser manufacturers and as a consultant to a third. I have also served as CEO of a large dermatology and plastic surgery network and we directly or indirectly purchased literally thousands of aesthetic lasers and medical light based equipment. I have been an attorney for over 25 years and have multiple graduate and doctorate degrees in science as well.
The areas of focus of this letter are based in three issues:
1. Laser manufacturer requirement of certification of resale lasers;
2. Laser manufacturers’ arguably discriminatory pricing for parts;
3. Laser manufacturers’ refusal to service lasers and light based medical equipment sold on the resale market.
4. Restrictions on who may repair/service a medical aesthetic laser.
The certification requirement centers on an industry policy that mandates that a purchaser of “used” medical aesthetic laser must have the device certified in order for it to be repaired or serviced at a later date. Frequently, such certification comes at a very expensive price. Although this is a valid and legitimate business interest of the laser companies, the implementation of the legitimate polices is legally unsupportable in most instances.
The reason that many of such policies are not legally supportable is that such policies are arguably in restraint of trade and subject to review of the Sherman Anti-Trust Act. It is arguably restraint of trade to charge disproportionately high fees relative to the acquisition price of an aesthetic medical laser. Laser manufacturers charge varying fees for “certification” when in fact, the certification process is largely the same for most devices. The certification process entails inspection of the device in order to determine whether it has been altered, modified or otherwise changed from its original configuration. This certification process may also necessarily include inspection of computerized or automated sub systems of the device, such as a computerized scanner.
The prices charged for this service are frequently outrageous given the time and expense involved in the process. As I stated above, this is a legitimate business interest and concern for the laser manufacturer. However, they are charging exorbitant and inconsistent fees for this service. Since the certification is necessary in order for the new owner to service or maintain the device, then buyer is at a competitive disadvantage in such transactions. This situation requires that laser manufacturers avoid appearance of tactics that rise to the level of restraint of trade. It has also been my experience that laser manufactures will waive or reduce the certification fee arbitrarily and also in violation of the laws intended to protect such situations.
The Sherman Anti-Trust Act of 1890 is designed to prevent monopolistic trade practices and anti-competitive business behavior. The certification requirement is a legitimate business interest. However, the fees charged in many/most instances are violative of the spirit and intention of the Act. Many laser manufacturers have even restricted or prohibited its suppliers and vendors from supplying the parts and services to owners of resold medical aesthetic lasers. However, this right must be asserted by the supplier or vendor, but it does merit mentioning.
In fact, one prominent laser manufacturer suffered a decrease in its stock price in 2008 because analysts were concerned about restraint of trade issues.
Additionally, the certification raises issues under the Uniform Commercial Code (UCC). Many of the certification policies will violate the intent and spirit of the Uniform Commercial Code, especially Article 2 of the Code governing Sales. A more thorough discussion of this issue is not practical under the UCC because all 50 states have adopted the UCC in some form, but there are differences from state to state. However, it is important to note that in many of the certification issues that I have encountered (many), the UCC in its adopted form in various states, has been violated.
Friday, July 8, 2011
Estheticans Cannot Inject Botox Cosmetic or Dermal Fillers
There seems to be a new and disturbing trend in aesthetic medicine. Non-medical providers, and in particular, estheticians, are injecting Botox® Cosmetic in a number of different facilities. In the past month, I have been contacted by three different medical providers in Nevada, Colorado and Texas. They are also injecting dermal fillers such as Restylane and JuveDerm. This is not legally supportable and the activity should stop immediately.
In each scenario, an esthetician was injecting Botox Cosmetic under the loose supervision of a physician (non-core physician, I might add). Apparently, in the respective cases, the physicians maintained that it was lawful for the estheticians to do this under the physician delegation regulations in each state. The rationale was that there was nothing that specifically precluded such practices.
There is nothing in the state regulations that tells estheticians (or physicians) that they cannot perform brain surgery, but we know that they cannot. Injecting Botox Cosmetic is the practice of medicine. There is no question about this and it is not an arguable point. It is not subject to interpretation or subjective beliefs. It is the practice of medicine for several reasons. First, Botox Cosmetic is a prescription drug. Secondly, it is administered via a 30 gauge syringe and it is diluted with saline. An esthetician cannot perform these functions. An esthetician cannot inject anything, including saline. Third, there is no insurance carrier that I am aware of that will provide coverage for an esthetician performing these services. This is clear indication that something is wrong. Fourth, the Board of Cosmetology in the respective states would not permit such conduct. Fifth, the Board of Medicine in the respective states would not permit such activity. There are patient safety, HIPAA and other concerns as well.
In the case of dermal fillers such as Restylane and JuveDerm, these are not prescriptive drugs. However, they are medical devices approved by the FDA and estheticians cannot legally inject them either.
The estheticians in question risk losing their license as well as civil and criminal fines. It is not worth it. The physicians supervising this activity would be subject to reprimand as well.
One of the additional disturbing aspects of this is that Allergan, the manufacturer of Botox Cosmetic, is aware of this and chose to do nothing.
In each scenario, an esthetician was injecting Botox Cosmetic under the loose supervision of a physician (non-core physician, I might add). Apparently, in the respective cases, the physicians maintained that it was lawful for the estheticians to do this under the physician delegation regulations in each state. The rationale was that there was nothing that specifically precluded such practices.
There is nothing in the state regulations that tells estheticians (or physicians) that they cannot perform brain surgery, but we know that they cannot. Injecting Botox Cosmetic is the practice of medicine. There is no question about this and it is not an arguable point. It is not subject to interpretation or subjective beliefs. It is the practice of medicine for several reasons. First, Botox Cosmetic is a prescription drug. Secondly, it is administered via a 30 gauge syringe and it is diluted with saline. An esthetician cannot perform these functions. An esthetician cannot inject anything, including saline. Third, there is no insurance carrier that I am aware of that will provide coverage for an esthetician performing these services. This is clear indication that something is wrong. Fourth, the Board of Cosmetology in the respective states would not permit such conduct. Fifth, the Board of Medicine in the respective states would not permit such activity. There are patient safety, HIPAA and other concerns as well.
In the case of dermal fillers such as Restylane and JuveDerm, these are not prescriptive drugs. However, they are medical devices approved by the FDA and estheticians cannot legally inject them either.
The estheticians in question risk losing their license as well as civil and criminal fines. It is not worth it. The physicians supervising this activity would be subject to reprimand as well.
One of the additional disturbing aspects of this is that Allergan, the manufacturer of Botox Cosmetic, is aware of this and chose to do nothing.
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