IV hydration services are becoming increasingly popular across the country as they offer a convenient way for individuals to receive intravenous vitamins, nutrients, or hydration on demand. In addition to traditional brick-and-mortar locations, in many jurisdictions, these services can also be provided at a location of the patient’s choosing, including their homes or hotel rooms. However, since the IV hydration industry is relatively new, many states have yet to address IV hydration services directly in their regulations or statutes. This lack of guidance and authority can make it challenging for business owners to ensure compliance. Furthermore, recent news events have shed light on the safety and regulatory risks associated with these operations. Thus, it is crucial for IV hydration business owners to carefully consider the following factors prior to, and after opening and running their operations.
Licensure Related Issues
As mentioned above, most states have not directly addressed IV hydration businesses or services via legislation. Thus, IV hydration businesses have been forced to exist in somewhat of a gray area of the law where the precise type of license and/or registration required is unclear to providers and regulators alike. Although there appears to be more clarity today, there are still numerous states that have yet to specify what type of licensure is necessary to operate an IV hydration business. This lack of clarity has forced business owners and practitioners to “shoe horn” themselves into existing licensure types. Moreover, there is extreme variance across states, as well as limited guidance in terms of the requirements that may apply when businesses are mobile/on-demand versus operating out of a brick-and-mortar location. Thus, if your IV hydration business provides on-demand services and crosses state lines, it is possible that your business will require a different form of licensure in each of the states in which it operates, or may need to simultaneously meet the requirements of multiple states at once.
Beyond the licensure requirements for the business itself, IV hydration employees are most often considered medical providers and must obtain and maintain appropriate licensure to provide IV hydration services. Like the licenses required of the business as a whole, the licenses required by the individual providers administering IV services to patients varies from state to state. To illustrate, some states may limit the ability to administer IV services to registered nurses, mid-level providers and/or physicians. Furthermore, the level of physician involvement and supervision may differ from state to state. For instance, some states may allow physicians to provide supervision from a remote location, while others may require the physician’s physical presence in, or within a certain distance of, the location where services are being provided. Certain states may also limit the number of mid-level providers that a single physician can supervise. A prospective IV hydration business owner must thoroughly analyze these factors and variables before offering any IV hydration services.
Contractual & State Law Related Issues
IV hydration businesses must ensure that they have contractual agreements in place to sufficiently protect themselves and comply with certain state law requirements. These include, but are not limited to, employment agreements with employed nurses, supervising physicians, and/or other providers involved in the provision of care to patients. Certain providers, like physician assistants or nurse practitioners, may also need to have a written delegation agreement or joint protocol in place with their supervising physician.
Furthermore, while each state defines the “practice of medicine” differently, IV hydration services are considered the “practice of medicine” in a majority of states. Given this variance, another major consideration that IV hydration businesses owners must be aware of is the role of their state’s “corporate practice of medicine” doctrine with respect to the structure of their business. While these rules vary greatly from state to state, they generally dictate who may practice medicine and/or employ individuals who practice medicine within the state in question. In states that prohibit the corporate practice of medicine, a physician (or group of physicians) licensed in the state may be required to own the IV hydration business as opposed to mid-level providers or non-physicians. In these states, non-physician investors may choose to utilize a management service organization (“MSO”) as part of their business model. While MSOs allow a level of investment by non-physicians in the IV hydration space and can provide valuable and often necessary services to IV hydration businesses, they also introduce additional obligations and considerations. For example, the MSO’s management service agreement with the medical practice will need to comply with state laws, including, but not limiting to, “fee-splitting” statutes prohibiting the sharing of fees for professional services rendered.
Supervision requirements, fee splitting laws and prohibitions on the corporate practice of medicine can vary from state to state. Thus, it is imperative that IV hydration businesses analyze the applicable state laws and structure their contractual agreements and corporate structure in a compliant manner at the outset so as to avoid issues down the line.
How Frier Levitt Can Help
Navigating the often-complex regulatory scheme surrounding IV hydration businesses can be onerous. Critically, failure to comply with applicable state laws and regulations may result in potentially significant penalties, including, but not limited to, substantial monetary fines and/or disciplinary actions by state professional boards. Thus, before operating an IV hydration business, operators must be sure their company is compliant with the requirements of each state in which it operates. For help understanding the legal requirements applicable to your IV hydration business, contact Frier Levitt. Our attorneys have the experience and knowledge to help ensure your IV hydration business is correctly structured and in compliance with applicable state laws and regulations.
