The North Carolina Board of Nursing and the North Carolina Medical Board have recently increased their investigative and enforcement efforts, appearing to target med spas and other wellness and aesthetics businesses. The majority of investigations we’re seeing are related to allegations of the unauthorized practice of medicine and/or nurses exceeding their scopes of practice. In order to ensure that you’re prepared for a potential investigation, now is a good time to revisit your compliance program and infrastructure, focusing first on the following big-ticket items.
- Corporate Practice Considerations. If you are not permitted to own a medical entity in North Carolina (i.e., you are not a physician or a physician assistant co-owning a medical entity with a physician) and, instead, you own a management services organization (aka MSO), be sure that you have a fully executed management services agreement (aka MSA) in place with the corresponding practice entity (PLLC or PC). The MSA is only one of the foundational contracts the boards are likely to request, so have your agreements in order.
- Medical Director Relationship. Be sure that you have a fully executed medical director agreement with a physician that defines the medical director’s role and duties, and ensures that all clinical care and decision-making ultimately reside with the medical director and, as appropriate, clinicians under the medical director’s supervision. It is also important that your medical director be regularly involved in the med spa’s day-to-day clinical operations; while they don’t have to be onsite every day in the role of medical director, you should be checking in with your medical director throughout the month and documenting such meetings. North Carolina medical directors also must satisfy chart-review and supervision-meeting requirements. Ultimately, you must be able to show that you are paying the medical director for services actually provided at fair market value.
- Financial Flow. Be sure that your bank accounts are properly structured. If your business is an MSO, the practice entity must have a separate bank account where med spa client payments go before you, as the manager, transfer money out of that account.
- Scope of Practice. Be sure that all providers in your med spa are operating within their respective scopes of practice and pursuant to any required supervision. This means that your clinical staff (e.g., RNs, nurse practitioners, etc.) should have collaborative practice/supervisory agreements in place with the medical director or another appropriate supervisor. Be careful about your non-clinical aesthetics providers, too; licensed aestheticians are not permitted to perform certain med spa services that the boards argue to be the practice of nursing or medicine—no matter how highly trained and competent they are.
- Clinical Protocols. Be sure that you have clinical protocols (often referred to as “standard operating procedures”) for every service you offer and that the protocols have been reviewed and approved by your medical director and remain in hard copy, onsite, for providers to refer to. Review your protocols and update as necessary at least once per year or anytime legal or clinical-regulatory implications necessitate revisions.
- Good Faith Exams. Ensure that you are performing a good faith exam on every patient upon initial intake, at least once per year, when a patient’s health changes, or when a patient requests new services. The good faith exam should be performed by a physician, nurse practitioner or physician assistant only. Check that the individual performing your good faith exams is actively licensed in North Carolina. If the clinician is providing virtual services to clients outside of North Carolina, ensure they are also actively licensed in the state where the patient is located at the time of the good faith exam.
- Patient Records. Be sure you have complete patient charts. The regulatory boards will want to see intake/medical history forms, good faith exam reports, relevant consent forms, and patient-specific orders for the services the patient is being cleared to receive (i.e., not standing orders applied to all patients).
- Advertising and Marketing. Ensure that your advertising, website, promotional materials, and social media accounts are compliant. For example, it’s a good idea to post your medical director’s name and information on your website and in marketing materials. Be sure you are only advertising services that you are actually providing and that all services are within your clinicians’ scopes of practice.
Well, That Won’t Happen to Me—Everyone Loves My Med Spa!
Which is precisely why you should take special care to ensure you’re compliant. Many of the investigations that we see are initiated by competitors, former business partners and/or disgruntled former employees, who file complaints with the boards. Complaints can be submitted anonymously and you won’t receive any useful specifics regarding the complaint or allegations until an investigation is open and underway. Even then, in most cases, the information about the complaint available to you will be significantly limited.
What You Can do to Protect Yourself, Your Business and Your License.
The above-listed issues, by no means, cover the spectrum of operational and administrative requirements that a board may investigate or ding you on; however, these issues are the most common that we’re seeing in this recent influx of investigations.
Now is the time to do an internal compliance audit. If you’d like assistance in ensuring that you’re fully compliant, please reach out to us—we’re here to help.
Remember: If you stay ready, you don’t have to get ready.