BFOA News

Columbia Physical Therapy v Benton Franklin-VICTORY
Supreme Court Victory for Orthopaedic Practices
WSOA and orthopaedic surgeons across the State have found themselves on the front lines of one of the most important battles affecting the practice of orthopaedic medicine throughout the country -- the fight to preserve physician employment of physical therapists.  In fall 2008, the Supreme Court of Washington decided to hear the case of Columbia Physical Therapy, Inc. v. Benton Franklin Orthopedic Associates, P.L.L.C. et al., in which Columbia Physical Therapy challenged the legality of orthopaedic medical practices employing physical therapists and referring patients to those employee therapists for physical therapy.  This was the second case to reach a state supreme court on the issue, which is commonly referred to as physician-owned physical therapy services ("POPTS").  The first case, decided by the Supreme Court of South Carolina in 2006, held that under South Carolina law orthopaedic surgeons could not employ physical therapists in their practices.

The Supreme Court of Washington has now weighed in on the issue.  On March 18, 2010, the Supreme Court issued a unanimous decision in favor of Benton Franklin Orthopedic Associates, making clear that it is legal for medical practices to employ physical therapists within their practices and to refer patients to those employee physical therapists.  In ruling in favor of Benton Franklin, the Supreme Court rejected each of the arguments that Columbia Physical Therapy had made against physician employment of physical therapists.  Specifically, the Court rejected Columbia's argument that POPTS is barred by the corporate practice of medicine doctrine and the Professional Service Corporation Act.  The Court also rejected Columbia's claim that Washington's anti-rebate statute bars physicians from referring patients for physical therapy furnished within a medical practice.  With respect to Columbia's claim under the anti-rebate statute, the Court also made clear that physician supervision of physical therapists is not required in order to comply with the anti-rebate statute.

This is a tremendous victory not only for the practice of orthopaedic surgery, but for all of medicine, as well as for patients who seek integrated, comprehensive medical care from their doctors.  The victory could not have been achieved without the incredible support of WSOA members from across the State, as well as from the broader medical community within Washington and across the entire country.  The Washington State Medical Association took the lead in preparing and filing a “state medical association” amicus curiae (friend of the court) brief that the American Medical Association and 18 Washington state medical organizations joined in support of Benton Franklin.  The American Association of Orthopaedic Surgeons took the lead in preparing and filing a “national medical association” amicus curiae brief in support of Benton Franklin that was joined by the American College of Surgeons, the American Medical Society for Sports Medicine and the American Urological Association.  Special thanks and appreciation is owed to Dr. Kontogianis and the other members of Benton Franklin, who have showed tremendous leadership and courage in defending against Columbia Physical Therapy's lawsuit for the last many years.  This is a victory of which all of us can be proud.

HOWARD R. RUBIN
Partner
Katten Muchin Rosenman LLP
2900 K Street NW, North Tower - Suite 200 / Washington, DC 20007-5118
p / (202) 625-3534 f / (202) 339-6057
howard.rubin@kattenlaw.com / www.kattenlaw.com