Thursday, September 15, 2016

SC Court Overturns Ban on Physician Employment of Physical Therapists

In a major victory for patients and their treating physicians, the South Carolina Supreme Court has overturned their previous ruling in Sloan and has lifted the ban on physician employment of physical therapists.  The decision was announced yesterday in the case of Joseph v. South Carolina Department of Labor, Licensing and Regulation (2016).
 
"The underpinning of Sloan is the assumption that physicians who refer patients to physical therapists under their employ will act in bad faith or be mired in a conflict of interest because of the financial remuneration they receive from the provision of such service.  We choose to make no such assumption concerning our brothers and sisters in the medical profession."
 
This patient-centered decision from the Court supports our contention that integrated physical therapy services can be in the best interest of patients when handled ethically and in compliance with existing self-referral restrictions.
 
"We now recognize that the interpretation in Sloan creates an absurd situation by strictly prohibiting physician-PT employment relationship without considering the resulting ethical implications or patient wellbeing.  See id. At 489, 636 S.E.2d at 617.  In fact, prohibiting physicians' employment of PTs deprives physicians of their right to practice medicine in the best interests of their patients.  As interpreted in Sloan, section 40-45-110(A)(1) appears merely to be anti-competitive protectionist legislation intended to protect personal financial interests, which is driven by reimbursement purposes, rather than actual benefits to patients.  Accordingly, we overrule Sloan as an unconstitutional interpretation of section 40-45-110(A)(1), and hold that the statute prohibits only referral-for-pay situations rather than prohibiting all employer-employee relationships between physicians and physical therapists."
 
The case was brought forward by two orthopaedic surgeons, Thomas Joseph, MD and William McCarthy, MD, and a physical therapist, Kristin Joseph, PT. 
 
The South Carolina Orthopaedic Association and the South Carolina Medical Association have worked together to reverse the Sloandecision for many years.  The South Carolina Orthopaedic Association also recognizes the support provided by the American Association of Orthopaedic Surgeons  and the American Medical Association. 
 
The SC Department of Labor, Licensing and Regulation and the South Carolina Chapter of the American Physical Therapy Association has 15 days to petition for rehearing.  The SCMA will continue to keep you posted on any pending action on this decision.
 
Click here to view the entire decision from the Court:  www.sccourts.org/opinions/HTMLFiles/SC/27666.pdf