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Criminal Liability for Rationing Medical Equipment During the Coronavirus Pandemic

Recently, a physician client called me and she was very concerned about potentially being charged with murder for rationing medical equipment, such as ventilators, during the COVID-19 Pandemic. She had been instructed by superiors to use the ventilators, which were in scarce supply, only on those patients that had the best chance of recovery. For the others, she would effectively be sentencing them to death and this caused added stress to an already stressful situation. I took the time to alleviate her concerns about potential liability and thought that I would share it with you as well.

 

  1. Can I Be Convicted of Murder for Rationing Medical Equipment?

 

In Florida, Excusable Homicide is defined as “the killing of a human is excusable, and therefore lawful when the killing is committed by accident and misfortune in doing any lawful act by lawful means with usual ordinary caution and without any unlawful intent.” I am not a criminal law attorney, but I believe that a physician could use Excusable Homicide as a defense in the very unlikely event that he finds himself in a position where murder charges were brought against him in connection with the death of a patient who didn’t receive certain medical treatment due to equipment rationing.

Florida has 3 different degrees of murder but I will only discuss the most serious, first-degree murder. First degree murder is defined as any intentional murder that is willful and premeditated. For a first-degree murder conviction, premeditation and deliberation must be proven. This doesn’t mean that a specific period of time must be involved in the planning of the murder. A prosecutor would only have to show that the perpetrator had enough time to consciously form a plan to commit the act with the intent to kill while also having enough time for a reasonable person to stop themselves from committing the act. It is not the intent of a healthcare provider to kill a patient when they ration medical equipment or supplies. They have limited resources and are making the best use of those resources given the circumstances. Absent any evidence to the contrary, I believe that any deliberation by the provider would be about prolonging human life and not willfully ending it. This is why I’m confident that no healthcare providers will be charged or convicted of first-degree murder, or any of the lesser degrees, for rationing of medical equipment during this pandemic.

  1. Can I Refuse to Provide Emergency Treatment to a Patient During the Pandemic?

 

The most obvious situation when a physician can refuse treatment is if the physician does not treat patients with the patient’s specific condition. In 1986, President Ronald Reagan signed the Emergency Medical Treatment and Active Labor Act (“EMTALA”) into law. The legislative intent of the law was very straightforward. A hospital with an emergency department could not turn away patients needing care because of their inability to pay. Hospitals are also prohibited from “dumping” patients onto other facilities for reasons other than receiving advanced treatment. Under EMTALA, if a patient presents herself to an ED with an emergency condition the ED is required to stabilize and treat the patient, regardless of her ability to pay. It’s important to note that a hospital may correctly follow EMTALA guidelines but still be responsible for malpractice damages if they misdiagnose a patient.

There may be situations where a hospital and its physicians do not have the capability to fully stabilize and treat a patient. In those situations, EMTALA allows a hospital to transfer the patient to get the appropriate level of care. For example, if a hospital is short on ventilators due to the Coronavirus that hospital may transfer the patient to another hospital that has an available ventilator so long as the patient is stable enough to physically handle the transfer and they’ve received informed consent.

Under EMTALA, a patient cannot directly sue a physician or hospital for not complying with EMTALA’s requirements, but physicians may be subject to civil monetary penalties and may be subject to exclusion from participation in the Medicare and Medicaid programs for repeated violations of EMTALA.

  1. Prohibited Activities and Liability during the Coronavirus Pandemic

 

Under Florida Statute §458.3295(1), which is titled “Concerted effort to refuse emergency room treatment to patients; penalties”, A Florida licensed physician may not instigate or engage in a concerted effort to refuse or get physicians to refuse to render services to a patient or patients in a hospital emergency room by failing to report for duty, absenting themselves from their positions, submitting their resignations, abstaining from the full and faithful performance of their medical duties, or otherwise causing conduct that adversely affects the services of the hospital. For the purposes of this subsection, the term “concerted” means contrived or arranged by agreement, planned or devised together, or done or performed together in cooperation.

Under Florida Statute §395.1041, Neither the hospital nor its employees, nor any physician, dentist, or podiatric physician are liable if a refusal to render emergency services or care is made after screening, examining, and evaluating the patient, and is based on the determination, exercising reasonable care, that the person is not suffering from an emergency medical condition or a determination, exercising reasonable care, that the hospital does not have the service capability or is at service capacity to render those services. If a hospital does not have capacity, the necessary medical equipment or supplies to treat a patient due to the Coronavirus pandemic, the hospital and its providers cannot be held liable for refusing to render certain emergency services or care.

  1. Final Thoughts

 

Presently, we are dealing with an extremely unusual set of circumstances and difficult decisions have to be made. The reality is that we have to ration the ventilators. We have over 350 million people in this country and estimates are that 40-60% of the population have or will contract COVID-19. Italy, Spain, France and China have had to ration their ventilators. Even healthcare providers are becoming sick and are using the ventilators.

The federal government, so far at least, is not providing national rationing guidelines for the coronavirus outbreak other than those issued by the CDC, HHS and VA. The Centers for Disease Control and Prevention has laid out general principles for how to allocate scarce resources in a pandemic response plan, but it leaves most of the details to individual states and institutions. States are coming up with their own ethical principles to determine need, while others are prioritizing patients based on their health condition, preexisting health problems and age. Countries around the world are doing the same thing. It’s not a first-come first-serve model right now. Hospitals are transferring patients to less crowded hospital or healthcare facilities, sanitizing and reusing supplies, coming up with makeshift ventilators, cancelling elective surgeries and procedures etc. Anything they can do to treat patients. To avoid conflicts of interest and the emotional toll of life-or-death judgments, many state plans call for a senior, supervisory doctor or a panel of doctors — similar to a “three wise men” protocol developed in Britain for this scenario — who are not the provider directly caring for the patient.

The Coronavirus Pandemic has been compared to a war and our doctors and nurses are the front line of defense. They’re our soldiers in this battle. They are basically operating under combat medicine guidelines, which means that they have to triage patients and prioritize care in a discriminate way based upon their chances of recovery but not discriminatorily. I can’t imagine a scenario where a prosecutor would bring charges against a physician for making the difficult decisions that they had to make during this pandemic. Even if they do, I doubt that a jury of their peers would find them guilty of murder given the circumstances. When this pandemic is behind us, I don’t believe that any healthcare providers will be charged or convicted of murder for rationing any medical equipment or supplies.

 

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It should be noted that I am not your lawyer (unless you have presently retained my services through a retainer agreement). This post is not intended as legal advice, it is purely educational and informational, and no attorney-client relationship shall result after reading it. Please consult your own attorney for legal advice. If you do not have one and would like to retain my legal services, please contact me using the contact information listed above.

 

All information and references made to laws, rules, regulations, and advisory opinions were accurate based on the law as it existed at this time, but laws are constantly evolving. Please contact me to be sure that the law which will govern your business is current. Thank you.

Negotiating Malpractice Insurance in Physician Employment Contracts

Medical Malpractice Insurance is an essential part of any physician’s practice. According to the American College of Physicians, “Medical Malpractice” insurance is a specialized type of professional liability insurance that covers physician liability arising from disputed services that result in a patient’s injury or death. Injuries may present themselves immediately or at some time in the future. Malpractice insurance requirements will vary depending upon several factors including, but, not limited to how long you have been practicing, the size of your practice, specialty, prior claims filed against you, etc. Many providers receive their malpractice insurance  through their hospital employer while independent physicians must purchase their own. You should carefully examine your insurance policy to determine whether your coverage is for “claims-made” or “occurrence”.

 

Claims-Made

A “Claims-Made” policy protects physicians for treatment that was provided from the first day of coverage through the expiration date. Since coverage ends on the expiration date you much always renew your claims-made policy on the expiration date to continue coverage without any gaps. Each year that a claims-made policy is renewed the retroactive date remains the same. The renewed claims-made policy covers claims that are filed during the policy year for incidents that occurred on or after the retroactive date. This allows for previous years to be covered under the current policy. In short, if you continue to renew a claims-made policy the protections in place will continue for any covered incidents that occur between the retroactive date and the expiration date. Any injuries that occurred prior to the retroactive date or after the policy has expired are not covered, which is why continuously maintaining this type of policy is important.

Claims-made policies allow you to increase your policy limits or add new coverage as needed or when new coverages become available. A claims-made policy allows an insured to transfer their coverage from one insurer to another without purchasing tail coverage, which will be discussed below. This only applies if you have an active claims-made policy that is transferable to another insurer that offers prior acts coverage for this claims-made policy. In this instance, the new insurer will rollover the retroactive date from the previous policy into the new policy. The new policy now covers the same period as the old policy since it includes the retroactive date. Unlike occurrence coverage, claims-made limits do not restore each year. The policy limits remain the same as they were when you initially purchased the policy.

 

Tail Coverage

Claims-made policies don’t cover claims made after the expiration of the policy, so you will have to purchase “Tail” coverage to continue coverage. Tail coverage (aka Extended Reporting Endorsement) is very important if you have been covered under a claims-made policy and are changing insurers, switching employers, or retiring. Tail provides malpractice coverage during the transition for injuries that may have occurred in the past. Tail allows the policy holder to have continuous coverage from the policy’s retroactive date to the policy expiration date. Any claims that are filed during that period are protected. To obtain tail coverage you must pay a one-time fee shortly after cancellation of a policy, but it can be as much as 1.5 to 2 times a typical annual malpractice insurance premium. Again, if you are transferring coverage from one insurer to another insurer tail policy coverage may not be necessary if the new insurer applies a retroactive date to your old policy.

 

Occurrence

Most physicians will opt for occurrence coverage where available. Occurrence policies protect you for treatment rendered during the entirety of the policy period, no matter when the claim is reported. An occurrence policy will still defend you against claims even after the policy has expired. This policy offers permanent coverage for incidents that occur during the policy period. Additionally, occurrence limits “restore” each year so that claims paid for incidents arising from one policy year do not deplete limits available to cover claims from other years. Each year that this type of policy is in effect constitutes a distinct set of limits. The amount of coverage in each year of coverage is aggregated annually to increase the limits.

 

Here are a few questions to Ask yourself

(1) What kind of coverage do I have?

(2) What are the policy limits?

(3) Do I have tail coverage?

(4) What type of incidents does my policy protect me from?

(5) Is this policy transferable?

(6) Will the new insurer retroactively date the new policy?

 

Final Reminders

*When negotiating hospital employment, physicians should ask the hospital to pay for the tail coverage or ask the hospital to allow them to continue their current coverage so that tail coverage is not required.

*Many physicians who are employed by hospitals may be required to obtain tail since most hospitals are self insured and won’t provide the incoming physician with prior acts coverage.

*Purchasing tail coverage may not be a choice. Some hospital bylaws require physicians to maintain malpractice coverage even after they are no longer with that hospital in order to protect from any potential future claims that may arise for any treatment that was provided by the insured while on staff.

*Some hospitals will not grant staff privileges to a physician with any gaps in their malpractice coverage.

*You want to make sure that you policy is always in effect and that it covers all potential claims because legal fees and costs can cost you thousands of dollars. These legal costs are in addition to any settlements that would have to be paid to the injured patient, which can range from a few thousand dollars to millions.

*The claims-made policy is more flexible and more cost effective especially for those who are still in the early years of their practice.

*“Claims-made” to the insurance company after the coverage period ends will not be covered, even if the alleged incident occurred while the policy was in effect. In other words you would personally be on the hook for any damages!

*Occurrence policies are permanent, which means that you don’t have to renew the policy to maintain coverage for any gaps in coverage. You have separate limits each year you were insured so past claims limit your coverage in the years ahead. These types of policies are becoming increasingly difficult to find.

*You should negotiate tail coverage in an employment contract with a new employer.

*Tail Coverage is only necessary when a Claims-Made policy expires and the insured cannot secure “nose” coverage for prior acts from a new insurance carrier.

*Medical Malpractice usually does not cover liability arising from criminal acts or sexual misconduct.

***This blog post does not constitute legal advice and is only intended for educational purposes only. You should consult a licensed attorney in the State of Florida that specializes in healthcare law.***

Which Business Structure is Best for my Medical Practice?

Which Business Structure is Best for my Medical Practice?

Over the years many providers have come to my office expressing an interest in owning a medical practice, healthcare facility, or healthcare business. During these meetings, it is important to obtain pertinent background information about the healthcare entity followed by a discussion about some of the regulatory and licensing issues that may arise. Equally important is determining how the healthcare entity should be structured for asset protection and tax purposes. A corporate healthcare attorney like myself can determine whether it is best for you to create a corporation, LLC, or an LLP. Admittedly, some of the more complex tax issues should be discussed with an attorney that specializes in tax law. Here is an overview of some of the basic differences between the different business entities.

Sole Proprietorship

An individual who does not create an entity.

  • No taxes are imposed on the entity. Instead, the individual owner reports the income and pays the income taxes.

Professional Corporation (a/k/a “P.A.”):

A corporation in which one or more shareholders must be licensed professionals (or entities that themselves are wholly-owned by licensed professionals). The P.A. can be taxed either as an S Corporation or as a C Corporation.

 

Corporation:

A corporation whose owner is not limited solely to licensed professionals. The corporation can be taxed either as an S Corporation or as a C Corporation.

  • C Corporation: Unless it elects otherwise, a corporation must report its own income and pay its own income taxes, under Subchapter C of the Internal Revenue Code.
    • A C Corporation is also subject to Florida’s state corporate income tax at a rate of 5.5%. Any distributions of its earnings to its shareholders requires the shareholders to recognize dividend income, resulting in a second layer or taxation.
    • Many professional C Corporations attempt to avoid distributing dividends by paying all income as compensation (because although it is still taxable to the recipient employee/shareholder, the C corporation gets a deduction for such compensation, resulting in one-layer of taxation).
    • If a C corporation pays excessive compensation, the IRS may try to treat some of the compensation as a dividend distribution and deny the deduction to the corporation with respect to such imputed dividend.

LLLP

A limited liability limited partnership comprised of at least one general partner and at least one limited partner, which is created by filing a Certificate of Limited Partnership and indicated LLLP status in such certificate. The status provides a general liability shield for all of the general partners.

S Corporation

No tax generally imposed on a corporation that elects to be treated as an “S Corporation” under Subchapter S of the Code. Rather, the tax consequences flow-through to the shareholder(s).

  • Each shareholder reports his or her pro rata share of the tax consequences based on his or her ownership in the S corporation and pays the income tax at his or her effective personal income tax rate.
  • Any distribution to the shareholder(s) is not treated as a dividend, but rather first is a return of basis and then excess is capital gain: provided, however, if the S corporation was formerly a C corporation within the past 10 years and had earnings and profits, then a portion of the distributions of the S corporation could be subject to tax as a dividend (Rather than a return of basis).
  • Shareholder distributions:
    • must be made in the ratio or ownership;
    • can be abused to “save” payroll taxes applicable to compensation; and
    • lack the asset protection potential of compensation payable to the head of a family under Florida law.
    • A P.A. generally should elect to be taxed as an S corporation, preferably from inception.
    • If a corporation has already been taxed as a C corporation, then conversion to S Corporation status must be carefully considered to ensure that the “built-in gains” tax on unrealized receivables can be handled through proper accrual and payment of accounts payable and compensation.

Professional Limited Liability Company (a/k/a “P.L.”)

A limited liability company in which one or more members must be licensed professionals (or entities that themselves are wholly-owned by licensed professionals). The P.L. can be taxed either as a disregarded entity (if there is only one member), as a partnership (if there is more than one member), or an S Corporation (whether it has one or more members.)

LLC

A limited liability company whose ownership is not limited solely to licensed professionals. The LLC can be taxed either as a disregarded entity, a partnership or an S corporation.

General Partnership

An entity that is comprised of two or more general partners. No written document is necessary to create a general partnership.

LLP

A limited liability partnership is comprised of two or more general partners, which registers with the state by filing a Statement of Qualification. The registration provides a general liability shield for all of the partners.

Limited Partnership

An entity comprised of at least one general partner and at least one limited partner, which is created upon the filing of a Certificate of Limited Partnership with the state.

There are many factors to consider when deciding how to structure your medical practice or healthcare entity. You should obtain an in-depth analysis of the various business structures so that you can choose the best one suited for your needs. While it is not impossible to change from one business entity type to another, it is always best to choose the best structure from the very beginning. A capable attorney at Jones Health Law, P.A. would be happy to guide you through this process.

***This blog post does not constitute legal advice and is only intended for educational purposes. You should consult a licensed attorney in the State of Florida that specializes in healthcare law.***

Florida Senate Bill 8-A’s Effect on Physicians’ Medical Marijuana Practices

Background

President Trump he has not taken a firm stance publicly in favor of or opposed to the use of medical marijuana. Currently, he intends to leave the medical marijuana issue up to the individual states. The 2016 fiscal year  omnibus appropriations bill appears to be in line with Trump as it contains language prohibiting the Department of Justice from meddling in state medical marijuana laws.

According to a Department of Health report, the state registry now has 16,614 patients. A recent state revenue impact study projects that by 2022 there will be approximately 472,000 medical marijuana patients and $542 million in sales.

Many activists expect that there will be several lawsuits related to SB8A. Legislators anticipated this and have added language that divides SB8A so that if certain parts are held unconstitutional the court would only invalidate those parts without invalidating the entire law.

Qualified Physician

Under SB8A, a “qualified physician” is a person who holds an active and unrestricted license to practice medicine in compliance with the physician education requirements. In order to be approved as a qualified physician, the physician must successfully complete a 2-hour course and exam by either the Florida Medical Association or the Florida Osteopathic Medical Association. The exam will not cost more than $500. This requirement also applies to those seeking to become Medical Directors in medical marijuana treatment centers (“MMTC”).

A “Medical Marijuana Treatment Center” means an entity that acquires, cultivates, possesses, processes (including development of related products such as food, tinctures, aerosols, oils, or ointments), transfers, transports, sells, distributes, dispenses, or administers marijuana, products containing marijuana, related supplies, or educational materials to qualifying patients or their caregivers and is registered by the Department. As you can see, the definition of an MMTC is very broad and includes virtually every type of business in the medical marijuana industry.

A qualified physician may not be employed by, or have any direct or indirect economic interest in, a medical marijuana treatment center or marijuana testing laboratory. This sentence is important because it means that not every physician is bound by this rule. If you are a physician and you have not taken the course and exam to become certified so that you can certify marijuana to your terminally ill patients then this law doesn’t apply to you. For example, if you are a dermatologist who does not treat any terminally ill patients and you are not a “qualified physician” for purposes of providing marijuana to terminally ill patients then you are not prohibited from being employed by or having an economic interest in an MMTC or marijuana testing laboratory (“MTL”). An MTL or “Independent testing laboratory” means a laboratory, including the managers, employees, or contractors of the laboratory, which has no direct or indirect interest in a dispensing organization.

This aforementioned provision of SB8A places broad limits on the types of marijuana facilities and businesses that a qualified physician is permitted to have a financial interest in. MMTCs and MTLs are off-limits to qualified providers. Non-Qualified providers are thus able to work for or have a financial interest in medical marijuana retailers, medical marijuana delivery devices, and medical marijuana delivery companies to name a few.

A qualified physician may not authorize a patient to receive more than three 70-day supply limits of marijuana. However, a physician may request an exception to the daily dose amount limit electronically. Further, a physician must evaluate an existing patient at least once every 30 weeks prior to issuing a new physician certification.

Physician Certification

Physician’s Certification means that a physician may authorize a qualified patient to receive marijuana and a marijuana delivery device (i.e. vape pen) from a MMTC. A physician may certify that a patient is in need of medical marijuana only after she has:

  • Conducted a physical examination while physically present in the same room as that patient (Telemedicine is not permissible) and recorded a full assessment of the medical history of the patient.
  • Diagnosed the patient with at least one qualifying medical condition.
  • Determined that the use of medical marijuana would likely outweigh the potential health risks for the patient and it is documented as such in the patient’s medical record. If a patient is under 18 years old, a second physician must concur with this determination, and it too must be documented in the patient’s medical record.
  • Determined that the patient is pregnant. A pregnant patient may only receive low-THC cannabis.
  • Reviewed the patient’s controlled drug prescription history in the prescription drug monitoring program database.
  • Reviewed the medical marijuana use registry and confirmed that the patient is not currently receiving medical marijuana from another qualified physician.
  • Registers as the issuer of the certification to the patient on the medical marijuana use registry.
  • Obtains the voluntary and written consent of the patient, or their parent or legal guardian if they are a minor, only after the physician has sufficiently explained its content, for the medical use of marijuana each time the physician issues the certification to the patient.

A physician certifying the use of medical marijuana for their patient must use a standardized informed consent form adopted by the Board of Medicine or Board of Osteopathic Medicine, which must include, at a minimum the following:

  1. The Federal Government’s classification of marijuana as a Schedule I controlled Substance.
  2. The approval and oversight status of marijuana by the Food and Drug Administration.
  3. The current state of research on the efficacy of marijuana to treat the qualifying conditions.
  4. The potential for addiction.
  5. The potential effect that marijuana may have on a patient’s coordination, motor skills, and cognition, including a warning against operating heavy machinery, operating a motor vehicle, or engaging in activities that require a person to be alert or respond quickly.
  6. The potential side effects of marijuana use.
  7. The risks, benefits, and drug interactions of marijuana.

That the patient’s de-identified health information contained in the physician certification and medical marijuana use registry may be used for research purposes.

Medical Marijuana Use Registry

Physicians should be aware that a review panel will be created by their respective Boards to review all physician certifications submitted to the medical marijuana use registry. The panel will track and report the number of physician certifications and the qualifying medical conditions, dosage, supply amount, and form of marijuana certified. The panel will report the data by individual physician and in aggregate formats by county and statewide. On the surface, it appears that the Board is just collecting data from those who certify patients to receive medical marijuana. However, it also appears that the Board is analyzing patterns and potential abuse by physicians who over prescribe or prescribe at a much higher rate than other qualified physicians that are similarly situated. At this time, I am not sure what action the Board would take if any, if they determine that there is some irregularity with the prescribing pattern of a particular physician.

The medical marijuana use registry must be accessible to qualified physicians and MMTCs to verify the authorization of a qualified patient or a caregiver to possess marijuana or a marijuana delivery device and record the marijuana or marijuana delivery device dispensed. The goal of the registry is to prevent an active registration of a patient by multiple physicians who can then receive and possess an amount of marijuana that exceeds the legal limits. The fear is that this will lead to an abuse of the Schedule I drug.

Penalties

SB8A doesn’t contain many penalties for physicians apart from the other laws and Board rules that currently exist to which physicians are bound by. However, I’m confident that with the proliferation of medical marijuana use by terminal patients and the tracking of prescribing patterns by the Board that there will be additional penalties for physician-owners and qualified physicians on the horizon. A qualified physician who issues a physician certification for marijuana or a marijuana delivery device and receives compensation from a MMTC related to the issuance of the physician certification for marijuana or a marijuana delivery device is subject to disciplinary action under the applicable practice act and Fla. Statute. 456.072(1)(n).

 

***This blog post does not constitute legal advice and is only intended for educational purposes only. You should consult a licensed attorney in the State of Florida that specializes in healthcare law.***

Annual Meeting of The Florida Society of Anesthesiologists

Jamaal R. Jones recently attended the Annual Meeting of the Florida Society of Anesthesiologists at the Breakers Hotel in Palm Beach, Florida.

The end goal of the meeting was for participants to:

1. Assess the potential application of emerging issues and advances that affect the practice of anesthesia; and

2. Apply contemporary practice management skills and knowledge of regulatory issues to the efficient and safe delivery of patient care.

If you are an Anesthesiologist, Anesthesiologist Assistant, or Nurse Anesthetist and would like to find out the various ways in which Jones Health Law can be of assistance to please contact us!

What Are My Options If I’ve Been Wrongfully Terminated From My Hospital Residency Program?

If you are discharged from a medical residency program it is important to examine the language contained in the hospital policies and procedure manual. In the manual it will explain the procedure for internal disciplinary action taken against hospital staff, which may require a mandatory board hearing depending on the alleged infraction. Prior to the board hearing, a neutral intermediary may be utilized so that direct communication between the hospital and the resident is limited. The disciplinary board may be comprised of a three-person panel where you can choose to present your defense. I would advise against signing any documents presented to you by the hospital after you have received written notice of the disciplinary hearing until you have spoken to an attorney with experience in health and employment law.

Seeing Through the Smoke of Florida’s Medical Marijuana Industry

As you may be aware, On November 8, 2016, Florida voters approved the use of Medical Marijuana in a constitutional ballot initiative called Amendment 2. This Amendment approved the use of Medical Marijuana in treatment for patients who suffer from specific debilitating medical conditions. These debilitating medical conditions include, but, are not limited to, cancer, AIDS, PTSD, glaucoma, Parkinson’s Disease, epilepsy, and Crohn’s disease. Physicians may also prescribe Medical Marijuana for “other debilitating medical conditions of the same kind or class” as those mentioned above and “for which a physician believes that the medical use of marijuana would likely outweigh the potential health risks for a patient.” Those looking to do business in the medical marijuana industry must proceed with some caution because even with the passage of Amendment 2 marijuana is still considered a controlled substance consumption of which is illegal under federal law.

Who Can Prescribe Medical Marijuana

Believe it or not, medical marijuana is a Schedule I drug and is regulated by the Florida Department of Health’s Office of Compassionate Use. In order to prescribe Medical Marijuana to a patient a physician must be licensed to practice medicine in Florida and certified by the Department of Health (“DOH”). Further, the physician must complete an 8-hour course and exam offered by either the Florida Medical Association (“FMA”) or Florida Osteopathic Medical Association (“FMOA”). Additionally, if the physician is a medical director of a Medical Marijuana Treatment Centers (“MMTC”) they are required to take a 2-hour course.

Restrictions on Use

Currently, Marijuana is only supposed to be used for the treatment of medical conditions and any recreational use is prohibited. Medical Marijuana may only be consumed in the form of food, tinctures, aerosols, oils, ointments, or related products. Notably missing is the permissibility to consume or use Medical Marijuana in a plant form that can be smoked.

Further, medical marijuana may only be prescribed to eligible patients as defined in Fla. Stat. §499.0295 as having a “terminal condition”. Patients will be classified as terminally ill only if two physicians designate them as such.

Additionally, Amendment 2 makes no accommodations for the use of medical marijuana at the workplace, public places, or school settings. Currently, federal and private program payors are not required to reimburse patients for medical marijuana treatment.

The DOH must register and regulate MMTCs that produce and distribute medical marijuana. Identification cards must be issued to patients and caregivers. In order to receive medical marijuana a patient must be: (1) a permanent Florida resident; (2) a patient of the ordering physician for at least three months; and (3) diagnosed with a debilitating medical condition.

Reaction to the Legalization of Medical Marijuana

The Trump Administration has stated that it intends to enforce federal law that prohibits the use of recreational marijuana, but they are unlikely to prohibit the legitimate use of medical marijuana for treatment purposes.

However, in some cities and counties throughout Florida, legislators and local officials are still trying to determine whether medical marijuana is even legal despite its overwhelming support by voters in Amendment 2. Throughout Florida, many cities are ill-prepared to regulate various aspects of the medical marijuana industry prior to the September deadline requiring its statewide availability. Even after the Trump Administration has made a public statement regarding medical marijuana officials are weary about implementing regulations because it is still federally prohibited. However, at least twenty-eight states have operated without significant intervention from the federal government after they have legalized either recreational or medical marijuana.

Many physicians welcome Amendment 2 and feel that it’s long overdue. Physicians are educating themselves on administering medical marijuana to their patients. For example, they are learning about the various strains of Cannabis and how certain illnesses may respond differently to a particularly strain and dosage. Many doctors prefer to prescribe medical marijuana rather than narcotics, which can be highly addictive to the patient. As a country, we are facing an opioid epidemic and by using medical marijuana as an alternative when appropriate may help to curb the addiction.

Medical Marijuana is Big Business

According to reports, there might be as many as 450,000 patients throughout Florida who may be eligible to receive medical marijuana treatment. That number is expected to rise as the types of illnesses that are treatable by marijuana becomes less narrow and not limited to debilitating medical conditions or terminal conditions. According to New Frontier’s projections, medical marijuana users in Florida will spend an estimated $200 million annually, and by 2020 Florida will account for 14% of the permissible marijuana use in the country.

There will likely be an expansion of dispensing organizations but it will not be easy. Currently, there are seven approved dispensing organizations in Florida. The following is a non-exhaustive list that the DOH considers when dispensing organizations apply:

  • The technical and technological ability to cultivate, process, and dispense low-THC cannabis;
  • The ability to secure the premises, resources, and personnel necessary to operate as a Dispensing Organization;
  • The ability to maintain accountability of all raw materials, finished products, and any byproducts to prevent diversion or unlawful access to or possession of these substances;
  • The financial ability to maintain operations for the duration of the 2-year approval cycle;
  • Passing a background check; and
  • Posting a performance bond.

Individuals seeking to enter the medical marijuana industry face several challenges due to federal laws that prohibit its manufacture, distribution, and use. Banks, insurance companies, and real estate brokers are hesitant to contract with medical marijuana companies due to the existing federal laws. Since it is illegal to operate a medical marijuana company on the federal level banks can’t or are unwilling to loan them money out of fear that there will be retribution  for funding an illicit enterprise. This will only change if Congress passes a measure to legalize the medical marijuana industry.

Conclusion

Legislators must quickly determine the ongoing medical marijuana education requirements for physicians and how it will be regulated. Providers will increasingly enter into the business because the law effectively shields them from civil or criminal actions that arise from their prescribing of medical marijuana. However, physicians may face discipline for wrongfully prescribing low-THC marijuana or medical marijuana. Physicians must ensure that they receive the requisite informed consent prior to prescribing medical marijuana. It’s still uncertain if Amendment 2 will expand the number of dispensaries and by how many. Also, if you are a non-physician looking to enter into the medical marijuana business it is not clear what role one can legally play in the medical marijuana industry other than owning a dispensing organization.

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