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Legal Challenges Surrounding IV Hydration Therapy: Navigating the Grey Zone

Picture this: Dr. Jim, a licensed medical doctor, wants to start an IV therapy business. His trusty sidekick, Ron, is a marketing genius who knows how to attract patients to Dr. Jim’s practice. Dr. Jim has set up a professional medical corporation, with himself as the sole shareholder, while Ron has his own LLC. But here’s where things get tricky.

Dr. Jim is grappling with a series of questions about how to best collaborate with Ron. Should Ron give him shares in the LLC? Can Ron’s LLC act as a management service organization (MSO) and collect a percentage as a management and marketing service fee for finding customers-turned-patients? And what about hiring a nurse to deliver the IV hydration therapy services?

Let’s talk about the role of the nurse in IV hydration therapy and explore the legal nuances surrounding this crucial part of the business. Let’s assume the nurse in question is a registered nurse (RN).

Dr. Jim raised a valid concern about nursing staffing companies and the legal grey zone they operate in. Ideally, the clinical company, in this case, the professional medical corporation, should be the employer of record for the RN. After all, it’s the MD who supervises the RN, so it makes sense for the RN to be an employee of the professional medical corporation. However, many in the industry opt for a more aggressive model, where a nursing staffing company leases out the RN to the practice. This is a common practice but comes with its own set of legal considerations.

Finding the right model for your business is more about legal strategy and your willingness to embrace regulatory risk than getting clear-cut yes or no answers. One crucial aspect to consider is understanding what the nurse can and cannot do, which is determined by laws and regulations.

Let’s talk into a few legal definitions that will shed light on this matter: administer, dispense, and furnish. In California, for example, these terms have distinct meanings, and your strategy for the nurse’s role should align with these definitions. “Administer” refers to directly applying a drug or device to the body, while “dispense” means furnishing drugs or devices upon a physician’s prescription or order. “Furnish” simply means supplying by any means, including selling. Additionally, there’s the concept of a “dangerous drug,” which cannot be furnished without a physician’s prescription.

As you can see, these legal definitions can quickly pile up, requiring a comprehensive understanding of the regulatory landscape to design a sound legal strategy for your specific business model. One important point to note is that an RN cannot be a prescriber, but they can either furnish or administer when the physician is the prescriber. Armed with this knowledge, Dr. Jim can make an informed decision about who should be the actual employer of the nurse and understand the limitations on the RN’s authority.

But that’s not all. California law imposes additional restrictions on whether IV therapy can be administered by a nurse based on a physician order outside the physician’s office (such as in a mobile unit) or if it can only be dispensed by the physician in a medical office.

And just when you thought you had tackled the nurse issue, there’s another legal challenge to consider: marketing claims. The Federal Trade Commission (FTC) recently cracked down on IV bars for making false or unsubstantiated claims about the effectiveness of IV cocktails. FTC requires that all healthcare claims be supported by competent and reliable scientific evidence, setting a high standard for marketing in the healthcare industry.

If you’re in the business of IV hydration therapy or any other healthcare service or product, it’s crucial to have a solid legal strategy in place. Register for our free IV Therapy Nutrition Masterclass to navigate these strategies as taught by KC.

Here’s to the success of your healthcare venture! We look forward to speaking with you soon