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Does Texas Permit the "Corporate Practice of Medicine"?

Medical License DefenseIn the United States, the licensure of medical professionals occurs on the state level. But it should be noted that there tends to be a great deal of accord between states on which standards and concepts to utilize in regulation and to have their regulatory bodies enforce. In Texas, it is the Texas Medical Board that the Legislature has created to establish the standards for licensure of physicians and maintain those standards by various means, including disciplinary action. This is the organization, therefore, that handles issues linked to the "corporate practice of medicine."

There's a reason we put quotation marks around that phrase. It is a term of art referring to a very particular legal doctrine, established on a state-by-state basis, that refers to the ability of corporations or other legal entities to engage in the practice of medicine—whether individually or by hiring physicians. Often this phrase is used in a way that, more specifically, refers to the prohibition of such practices. Such is the case in Texas. Which is to say, the "corporate practice of medicine" is not permitted in our state—with certain exceptions.

This prohibition of the corporate practice of medicine has arisen as a matter of policy, over time, as a way to protect the public. Beyond the mere fact that only licensed practitioners are permitted to practice medicine, there is concern that when a corporation hires a physician as an employee, the physician's capacity to exercise their medical judgment may be compromised. A common way that physician-employees’ judgment may be compromised is when they are required to conform to judgments set for them by an employer that may have a different set of values guiding it (such as the profit motive). This is considered to be problematic from the perspective of the patient-physician relationship.

But the exceptions to this prohibition in Texas are important ones. Starting in 2011, the Legislature began permitting specific hospital districts and particular hospitals to hire physicians directly. But the Legislature made sure to include language to mitigate any issues that might arise concerning the public policy mentioned above, at Texas Health and Safety Code section 311.083:

(a) A hospital that employs physicians under this subchapter shall:

 (2) adopt, maintain, and enforce policies to ensure that a physician employed by the hospital exercises the physician's independent medical judgment in providing care to patients at the hospital and other health care facilities owned or operated by the hospital.

If you find your license to practice medicine under attack for any reason, contact the experienced medical license defense attorneys at BERTOLINO LLP. We are ready to represent you.

BERTOLINO LLP represents licensed professionals across the entire State of Texas. To best serve our clients, we have offices in Austin, Houston, and San Antonio. Our honest, experienced attorneys will fight aggressively on behalf of your license and reputation.

Contact us today or call (512) 717-5432 and schedule a case evaluation.

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Attorney Tony R. Bertolino is the Managing Partner with Bertolino LLP. Our law firm has been able to help people across the state of Texas. If you need an experienced lawyer to represent you, contact Bertolino LLP today.

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