Regulatory Uncertainty in Infusion Care Explored by Jaya White and Kiel Zillmer in MedCity News Article
Jaya White and Kiel Zillmer, partners in the Quarles & Brady Health & Life Sciences Practice Group, wrote an article for MedCity News about the varied state regulations facing health care providers looking to enter the fast-growing infusion industry. White is national co-chair of the firm’s Long-term Care team.
In the article, White and Zillmer provide an overview of recent regulatory trends impacting providers of ambulatory infusion suites or home infusion delivery models. In many cases, state guidance related to medical spas, intravenous (IV) hydration and IV therapy clinics includes broader language that may also be applicable to infusion. They also highlight guidance from some states that is indicative of the regulatory direction impacting infusion providers.
An excerpt:
State-by-state infusion compliance varies significantly, blurring the lines as to what licensure is required, who can operate an IV therapy clinic, and who can administer IV therapy at all. This uncertainty is particularly relevant and concerning for those entities looking to enter the infusion industry by opening a new business or acquiring an existing business. When considering purchasing and assuming the operation of an infusion business, it is essential that the buyer understand: (1) the jurisdictions in which the business is located; (2) the full scope of services provided by the business and individuals; (3) the identity of the business’s owners; and (4) any professional licenses held by such owners. Obtaining this knowledge during the due diligence phase will allow the buyer to effectively determine what, if any, licenses the business itself is required to maintain.
Completing and submitting initial license or change of ownership applications can have significant impacts on the structure of a transaction and the timelines associated with closing. Moreover, to the extent a buyer determines that a target business failed to maintain licensure that it otherwise should have held prior to engaging in the transaction, the buyer should consider including mechanisms to protect itself from any resulting regulatory enforcement action or sanction. This may include: (i) requiring the seller to provide certain representations and warranties in the purchase agreement; (ii) obligating the seller to indemnify buyer from any such enforcement action or regulatory penalties; or (iii) obtaining representation and warranty insurance to protect buyer from any financial losses due to breaches of representations and warranties made in a transaction.