Presentation is loading. Please wait.

Presentation is loading. Please wait.

Legislative Protections for Texas Optometrists EyeCon 2014 Drew York Gray Reed & McGraw, P.C.

Similar presentations


Presentation on theme: "Legislative Protections for Texas Optometrists EyeCon 2014 Drew York Gray Reed & McGraw, P.C."— Presentation transcript:

1 Legislative Protections for Texas Optometrists EyeCon 2014 Drew York Gray Reed & McGraw, P.C.

2 Three Principal Statutes Protecting Optometrists Optometry Act (Texas Occupations Code Chapter 351) Texas Insurance Code Chapter 1451 Medical Liability Act (Texas Civil Practice and Remedies Code Chapter 74)

3 Texas Optometry Act (Occupations Code Chapter 351) Section 408 “prevent[s] manufacturers, wholesalers, and retailers of ophthalmic goods from controlling or attempting to control the professional judgment, manner of practice, or practice of an optometrist or therapeutic optometrist.”

4 Texas Optometry Act (Occupations Code Chapter 351) Section 408 “prevent[s] manufacturers, wholesalers, and retailers of ophthalmic goods from controlling or attempting to control the professional judgment, manner of practice, or practice of an optometrist or therapeutic optometrist.” The defendant must be a manufacturer, wholesaler, or retailer of ophthalmic goods.

5 Texas Optometry Act (Occupations Code Chapter 351) Section 408 “prevent[s] manufacturers, wholesalers, and retailers of ophthalmic goods from controlling or attempting to control the professional judgment, manner of practice, or practice of an optometrist or therapeutic optometrist.” The defendant must be a manufacturer, wholesaler, or retailer of ophthalmic goods. Section 408 does not apply to other optometrists or any legal entities owned and controlled by an optometrist unless the optometrist or legal entity has more than three locations.

6 Texas Optometry Act (Occupations Code Chapter 351) Section 408 “control or attempt to control the professional judgment, manner of practice, or practice of an optometrist or therapeutic optometrist" includes: This means the following list is not exhaustive, which is important because the statute is liberally construed.

7 Express Examples of Violations of Section 408 (1)setting or attempting to influence the professional fees or office hours of an optometrist or therapeutic optometrist Example: You lease space from Supermart for your optometry practice. Supermart retails glasses and contacts to customers. Your lease with Supermart states you must be open Monday-Saturday 9 a.m.-7 p.m. Supermart is violating Section 408 by setting your office hours.

8 Express Examples of Violations of Section 408 (1)setting or attempting to influence the professional fees or office hours of an optometrist or therapeutic optometrist Example: You lease space in a strip mall shopping center from GRM LLC, a real estate development company. Your lease states you must be open 24 hours a day, 7 days a week. Because GRM LLC does not manufacture or sell (either wholesale or retail) ophthalmic goods, the lease provision does not violate Section 408.

9 Express Examples of Violations of Section 408 (2) restricting or attempting to restrict an optometrist's or therapeutic optometrist's freedom to see a patient by appointment Example: Your lease with Bullseye, a big box “all in one” store, is up. In the new lease agreement, Bullseye requires that you see patients on a walk-in basis only. Your practice suffers a 20% drop in patients seen. The new lease violates your freedom to see a patient by appointment, and therefore violates Section 408.

10 Express Examples of Violations of Section 408 (3) terminating or threatening to terminate an agreement, including a lease, or other relationship in an attempt to control the professional judgment, manner of practice, or practice of an optometrist or therapeutic optometrist Example: manufacturer threatens to stop giving you a 20% discount if you don’t begin selling their newest contact lens product. NOTE: the phrases “professional judgment” and “manner of practice” are not defined. In a lawsuit, the plaintiff-optometrist likely proves this through their own testimony about how the threat attempted to control their professional judgment or manner of practice.

11 Express Examples of Violations of Section 408 (4) providing, hiring, or sharing employees, business services, or similar items to or with an optometrist or therapeutic optometrist Example: Supermart hires your employees

12 Express Examples of Violations of Section 408 (5) making or guaranteeing a loan to an optometrist or therapeutic optometrist in excess of the value of the collateral securing the loan Example: An optometry practice is looking to open a fifth location. The location is in Midland, but you live in Dallas. The practice offers you a $300,000 advance to move to West Texas. The advance is to be paid back over three years based on your revenue produced, but in the event you do not produce enough revenue to pay off the entire advance, the practice will forgive the outstanding balance.

13 What are an Optometrist’s Remedies for a Violation of Section 408? There are multiple remedies available to optometrists: Damages; Reasonable attorney’s fees; Court costs; Injunction against the violator; and A civil penalty not to exceed $1,000 for each day a violation occurs But maybe not after the Forte v. Wal-Mart Stores, Inc. case A violation of Section 408 may also be brought under the Texas Deceptive Trade Practices Act.

14 When Must You Bring a Lawsuit for a Violation of Section 408? The statute does not have an express limitations period. Generally under Texas law, if a claim does not have an express limitations period, a party must bring the claim within four (4) years after it accrues. There are two cases holding claims for violations of Section 408 must be brought within 4 years. BUT, there is one case holding the claim must be brought within two (2) years.

15 Forte v. Wal-Mart Stores, Inc. Facts: Wal-Mart leased space to optometrists and required the optometrists to make representations about the number of hours their offices would remain open in the lease agreements. The optometrists sued, claiming Wal-Mart’s lease agreements violated Section 408. At trial the court instructed the jury that the plaintiffs did not claim to have suffered any economic damages, and only sought to recover civil penalties.

16 Forte v. Wal-Mart Stores, Inc. Facts (Cont’d.): The jury awarded the plaintiffs $3,953,000 in civil penalties, which was the maximum amount allowed under the Optometry Act. The jury also awarded the plaintiffs approximately $764,000 in attorney’s fees. The court subsequently reduced the jury’s civil penalty to $1,396,400.

17 Forte v. Wal-Mart Stores, Inc. Issues on Appeal: Wal-Mart raised two arguments on appeal: 1.The Optometry Act’s prohibition against controlling or attempting to control the professional judgment or practice of an optometrist should be limited to controlling or attempting to control the optometrist’s medical judgment. 2.The jury’s award of civil penalties cannot be allowed under Texas law because the optometrists did not seek or recover any actual damages.

18 Forte v. Wal-Mart Stores, Inc. Court of Appeals Decision: The Optometry Act’s prohibition is not limited to situations where a manufacturer, wholesaler or retailer controls or attempts to control an optometrist’s medical judgment. The plain language of the statute is not limited to situations involving an optometrist’s medical judgment; AND The statute expressly prohibits Wal-Mart from taking any action “setting or attempting to influence the... office hours of an optometrist.”

19 Forte v. Wal-Mart Stores, Inc. Court of Appeals Decision: Could a court find that the Optometry Act should be limited to situations involving control over an optometrist’s medical judgment? Potentially.

20 Forte v. Wal-Mart Stores, Inc. Court of Appeals Decision: The optometrists are not entitled to the civil penalty award because they did not seek or recover actual damages. But how if the Optometry Act allows for a civil penalty of up to $1,000 per day? Texas law defines “civil penalties” as a form of punitive damage. In order to be able to recover punitive damages under Texas law, a plaintiff must recover some amount of actual damages.

21 Forte v. Wal-Mart Stores, Inc. Takeaway: The court’s ruling on civil penalties is disappointing, but it is a learning experience. If the Legislature will follow-through, there are ways to modify the statute to allow optometrists to recover damages even if the optometrist does not have any actual damages.

22 Forte v. Wal-Mart Stores, Inc. Takeaway: Even if you didn’t suffer any damages, you still have a claim for a violation of Section 408. In this situation, you may be able to obtain an injunction and recover your attorney’s fees.

23 Texas Insurance Code

24 Insurance Contract Prohibitions Chapter 1451’s prohibitions apply only if a “managed care plan” provides vision or medical eye care services. A managed care plan is not required to provide vision or medical eye care services.

25 Insurance Contract Prohibitions Texas Insurance Code § Prohibits a “managed care plan” from limiting the fee an optometrist can charge for a product or service that is not covered by the insurance policy. Example: Vision plan provides insured a $130 allowance for frames with a 20% discount on the balance. This is okay so long as the managed care plan is not placing a cap on how much the optometrist charges for the frames.

26 Insurance Contract Prohibitions Texas Insurance Code § Also prohibits managed care plan from requiring the optometrist to discount products or services not covered by the insurance policy. Example: Vision plan allows covers one eye exam every 12 months, but requires the optometrist to discount any additional eye exams during the 12-month period by 50%. This violates the statute.

27 Insurance Contract Prohibitions Texas Insurance Code § If a “managed care plan” provides vision or medical eye care services, the HMO/PPO is prohibited from excluding an optometrist as a participating plan practitioner because the optometrist does not have medical staff privileges at a hospital. Also prohibits the HMO/PPO from excluding an optometrist because the optometrist’s services could be provided by an ophthalmologist or other health care practitioner.

28 Insurance Contract Prohibitions These prohibitions only apply to insurance contracts entered into after January 1, 2014.

29 What is a “Managed Care Plan” “a plan under which a health maintenance organization, preferred provider benefit plan issuer, or other organization provides or arranges for health care benefits to plan participants and requires or encourages plan participants to use health care practitioners the plan designates.

30 Do Sections and Apply to Medicaid Managed Care Organizations? Possibly Definition of “managed care plan” is not limited to HMOs and PPOs. An MMCO arranges for health care benefits for its insureds and requires or encourages insureds to use certain health care practitioners


Download ppt "Legislative Protections for Texas Optometrists EyeCon 2014 Drew York Gray Reed & McGraw, P.C."

Similar presentations


Ads by Google