On October 9, 2019, Governor Gavin Newsom signed Senate Bill No. 697 (SB 697) into law, ushering in significant changes to the supervision requirements for physician assistants (PAs) in California. Effective January 1, 2020, these changes enhanced the autonomy of PAs and aligned their practice more closely with that of nurse practitioners (NPs). The key reforms include the replacement of delegation of services agreements with practice agreements, the elimination of specific supervision mandates, and the expansion of PA prescription authority.

The implementation of Senate Bill (SB) 697 (Caballero, Chapter 707, Statutes of 2019) has led to significant changes in Physician Assistant (PA) practice regulations. During a Physicians Assistant Board Meeting on August 7, 2020, the Board decided to amend all regulations affected by SB 697. These amendments were divided into two regulatory packages, with proposed changes to title 16, CCR sections 1399.502, 1399.540, 1399.541, and 1399.545 being part of the SB 697 Implementation rulemaking. This rulemaking transitions from the “delegation of services” model to a “practice agreement” model. Initially, the Medical Board of California (MBC) needed to approve these changes, which they granted in May 2021.

In July 2021, the California Academy of Physicians (CAPA) expressed concerns about the proposed text for SB 697 Implementation. The Board, along with CAPA representatives and other key stakeholders, met multiple times to address these concerns. On October 13, 2021, a meeting was held specifically to discuss CAPA’s feedback, leading to revisions in the proposed regulatory language. These revisions were approved by the Board on November 8, 2021. The subsequent passage of SB 806 (Roth, Chapter 649, Statutes of 2021) removed the Board from MBC jurisdiction, meaning the revised SB 697 Implementation Text no longer required MBC approval.

Public Comment Period

The public comment period for the proposed amendments began on July 28, 2023, and ended on September 12, 2023. The Board received three public comments, which led to further revisions. The revised regulatory language was approved at the November 6, 2023 Board meeting, prompting another 15-day public comment period from December 5, 2023 to December 20, 2023. Again, the Board received three public comments.

In response to the comments received, the Board, in accordance with Government Code section 11346.9, subdivision (a)(3), summarized each objection or recommendation and the reasons for accepting or rejecting them. CAPA’s comments included concerns about the accuracy of the proposed language, grammatical corrections, and the supervisory relationship between PAs and supervising physicians. The Board made several changes in response, including correcting text inaccuracies, revising language to reflect proper medical terminology, and removing requirements that were deemed to misrepresent the legal relationship between PAs and supervising physicians.

The California Medical Association (CMA) also provided comments, suggesting amendments to ensure the supervising physician’s responsibility in reviewing PA qualifications and clarifying the use of terms like “evidence” versus “documentation.” The CMA proposed excluding surgical procedures performed under local anesthesia from certain requirements to avoid disrupting current practices. The Board acknowledged these comments and made adjustments accordingly.

Further comments from the California Orthopaedic Association (COA) suggested additional clarifications regarding the roles and responsibilities in practice agreements. The Board reviewed these suggestions but found that certain proposed changes were either redundant or not authorized under the existing statutory framework.

Overall, the Board’s responses and proposed amendments aim to align the regulations with SB 697’s intent, ensure clarity in the roles and responsibilities within PA practice agreements, and address stakeholder concerns while maintaining regulatory compliance. The recommended changes were put forward for further public review and final adoption, ensuring a comprehensive and transparent regulatory process.

Key Changes Introduced by SB 697

Under SB 697, we saw a transition from Delegation of Services Agreements to Practice Agreements. Prior to SB 697, PAs were required to operate under delegation of services agreements with each supervising physician, which confined their scope of practice to the specific tasks outlined in these agreements. SB 697 changes this requirement by introducing practice agreements. These are comprehensive documents that are developed collaboratively within an organized healthcare system, defining the medical services a PA is authorized to perform. Practice agreements do not necessitate naming specific supervising physicians, therefore streamlining administrative processes and reducing redundancy (Bus. & Prof. Code § 3501(k), as amended by SB 697).

What is a Practice Agreement?

A practice agreement is a written document developed collaboratively among one or more physicians and surgeons and one or more physician assistants within an organized healthcare system. It outlines the medical services that a PA is authorized to perform, ensuring that these services are consistent with the PA’s education, training, and competence. The agreement must include policies and procedures for adequate supervision, communication, consultation, and referral between the PA and the supervising physicians. Furthermore, it should establish protocols for ongoing evaluation of the PA’s competence, the furnishing or ordering of drugs and devices, and any additional provisions agreed upon by the PA and the supervising physicians (Bus. & Prof. Code § 3502.3).

Eliminating Supervision Mandates 

The previous legal framework mandated rigid supervision methods for PAs, including same-day patient examinations by a supervising physician, the countersignature of medical records, or adherence to detailed protocols (16 CCR § 1399.545(e)). SB 697 abolishes these stringent requirements, allowing for more flexible supervision as defined within the practice agreement. Supervision now merely requires that the supervising physician be available via telephone or electronic communication during patient examinations, eliminating the need for physical presence or routine countersignature of medical records.

Expansion of Prescription Authority

Under the old regulations, PAs needed to include their supervising physician’s name and contact information on all prescriptions and required specific supervision to prescribe medications. SB 697 removes these requirements, permitting PAs to prescribe medications more independently. The practice agreement must still delineate the supervisory arrangements for prescribing, with the supervising physician accessible electronically during patient examinations.

Additionally, SB 697 authorizes PAs to furnish or order Schedule II or III controlled substances in accordance with the practice agreement or a patient-specific order approved by the treating or supervising physician. PAs authorized to furnish Schedule II controlled substances must complete a controlled substances course by their next license renewal if they possess DEA registration (Bus. & Prof. Code § 3502.1(e)(3)).

Ownership Restrictions

Despite the expanded roles and responsibilities for PAs under SB 697, the law does not alter the ownership restrictions set forth by the Moscone-Knox Professional Corporation Act. PAs are still prohibited from owning a majority share in a professional medical corporation. They cannot own more than 49% of such a corporation, ensuring that the majority control remains with licensed physicians (Corp. Code § 13401.5(a)(7)). This restriction maintains the traditional structure of medical practice ownership in California, balancing the increased autonomy of PAs with regulatory oversight to safeguard the quality of care and professional standards within the healthcare system.

How Lengea Can Help

Navigating these regulatory changes can be complex, and our firm is here to help. We specialize in healthcare regulations and offer practice agreement services to ensure compliance within the legal requirements. Our expertise ensures that your practice agreements not only meet statutory standards but also integrate seamlessly with your operations.

Our team is dedicated to supporting healthcare providers, offering comprehensive legal advice and practical solutions tailored to your specific needs. We understand the intricacies of healthcare law and are committed to helping you achieve compliance while maintaining the highest standards of patient care. Contact us today to ensure compliance and optimize your legal agreements to meet the legal standards. 

At Lengea Law, we focus on healthcare law and have extensive experience guiding clients through all aspects of the business. If your practice needs advice on regulatory compliance, please contact us for a complimentary 15-minute consultation. We’re here to help you every step of the way.

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This blog is for informational purposes only and does not constitute legal advice. Please consult a legal professional for advice specific to your situation.

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