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Many recent international agreements sponsored by bodies such as the World Trade Organisation (WTO), aim to facilitate the global free flow of goods, services and capital, by opening markets under the threat of trade sanctions. Nation States signing such agreements, in particular the Trade Related Aspects of Intellectual Property Rights (TRIPS), agree to suffer a sovereignty deficit in order to enhance their trading prospects. In the resulting reorganization of trade, medicine may be marginalised as merely another industry that must open its regional doors in the interests of global corporate productivity. We make a plea for medical organizations to lobby in appropriate international forums to create "hard" norms that ensure such international trade agreements that adequately respect the demands of fundamental ethical principles of the doctor patient relationship, principles such as medical loyalty and beneficence.

One of the most exclusive clubs in the dental world comprises the 27 members who can call themselves Dental Bodies Corporate (DBCs). Among this elite are well-known names such as Dental World, Dencare, Whitecross, Benedent and also Oakley, which is owned by Denplan. In the UK only dentists and DBCs are permitted to carry on the business of dentistry. DBCs are simply companies whose directors (the majority of whom must be dentists) are protected by the laws of limited liability, with the purpose of encouraging investment by shareholders (who need not be dentists). This article outlines the story of how this select band of Corporate Bodies gained their exclusive status which goes back to the very earliest days of our profession.

The Minnesota Health Care Cooperative Act, enacted as an article of the Minnesota Health Care Act of 1994, allows the creation of "health care provider cooperatives," corporations where members are licensed health care providers. Organized under Minnesota Statutes 62R, health care provider cooperatives (referred to hereafter as cooperatives) market their services to health care purchasers, including licensed health plan companies, health maintenance organizations (HMOs), and government plans on a "substantially capitated or similar risk sharing basis." Solvency and reserve standards do not apply to cooperatives because they are not engaged in the business of insurance.

As doctors jump at offers from practice managers, many ignore business basics. But even a good lawyer can't cover everything. "No matter how carefully you make an agreement with one company, if it is swallowed up by another, it can be very different than you anticipated," says a doctor who sold his Southern California network only to be fired after a change in owners. "You could go to bed with Albert Schweitzer and wake up with Attila the Hun."

Largely because of its indifference to spiraling costs, the professional domination model is being replaced by a market model based on competition among managed care plans and integrated delivery systems. In general, the more fully integrated previously competing providers become--for instance, by assuming financial risk together--the less legal risk is present, because of a decreased possibility of improper conspiratorial or collective behavior. Nevertheless, provider joint ventures and integrated delivery systems face a complex interaction of practical challenges and various legal and regulatory risks. This chapter explores ways in which laws involving fraud and abuse, self-referral, private inurement, corporate practice of medicine, Medicare reimbursement policy, and antitrust enforcement affect typical integrated delivery systems. From a legal standpoint, it might seem logical that the laws regulating health care providers would support and promote integration. A permissive legal environment to foster development of an integrated service network model assumes its development in a delivery system in which networks are at financial risk for the services provided. However, many of the laws and regulations governing integrated provider development were established at a time when joint ventures and other alliances were organizing in a predominantly fee-for-service environment and were generating significant increases in health care costs without producing demonstrable efficiencies or quality enhancements. The results is a fundamental inconsistency in government policy. The demand for collaboration by purchasers and legislatures does not necessarily cause the vast body of health care regulators to revise their concerns that many of the very collaborative activities being encouraged trigger potentially illegal acts and relationships. In a market model, the application of federal and state antitrust laws is especially important. In 1993 and 1994, the Department of Justice and the Federal Trade Commission jointly issued "Statements of Antitrust Enforcement Policy" in a number of areas of provider uncertainty. For integrated delivery systems, the primary focus of antitrust analysis is "market power." Systems without market power (i.e., the ability to force a purchaser to do something that the purchaser would not do in a competitive market) cannot harm consumers and should be free from serious antitrust risk. Where a network may have market power, its activities may be limited only if demonstrable anticompetitive effects outweigh the benefits of the efficiencies claimed by the new arrangement. The chapter concludes that vigorous antitrust enforcement may be required to promote market competition among integrated networks of providers and the managed care plans they serve.

This article provides an overview of the critical business and legal issues encountered in sales of practices, ambulatory surgery centers, and dialysis facilities. Specifically, it discusses prototypical valuations, transaction structures, and the principal legal issues that must be addressed.

The Department of Justice has estimated that the government loses $100 billion annually in health care fraud. Consequently, the government's health care fraud enforcement activities with respect to all health care providers and suppliers continue to grow. Last year alone, the government collected more than $8 billion in settlements, fines, and penalties involving health care fraud. Recent settlements with the government have begun to include corporate compliance programs that require continued government oversight of the health care organization as an essential part of the settlement. The first section of this article describes the legal significance of health care companies' having corporate compliance programs. The second section provides a sample list of topics that should be included in any corporate compliance program. Finally, we describe various issues related to the creation and implementation of corporate compliance programs.

Strong physician-driven delivery systems are vital to the creation of a quality medical system for the United States. To compete with employers, insurers, hospitals, and the government, physicians must consolidate. Physicians do not generally have the necessary capital, management skills, or desire to manage large organizations, however. In addition, antitrust restrictions, antireferral statutes, insurance regulation, and malpractice liability risks are major legal obstacles that restrain physicians from consolidating. The government needs to recognize the problems that federal and state laws have created for the development of physician-driven delivery systems. The benefit to the medical system by relaxing these laws will outweigh any potential risk of loss to the public.

The prospects for federal legislation preempting state corporate practice restrictions are unclear. The health care reform bill originally introduced by President Clinton contained a provision that would have preempted "any state law related to the corporate practice of medicine" insofar as it applied to the arrangements between non-fee-for-service health plans and their participating providers. H.R. 3600/S. 1757, 103d Cong., 1st Sess. 1407(b) (1993). Whether and in what form a preemption provision may survive the legislative process and see a Presidential signature remains to be seen. The particular fate of the federal legislation notwithstanding, however, health care executives can nevertheless remain confident that the legal treatment of the "corporate practice" of medicine will continue to be of vital concern as the various forms of health care organizations evolve in the ongoing struggle to deliver quality medicine at affordable prices.

Prior to the 1980s, managed care was virtually nonexistent as a force in health care. Presently, 64 percent of employees in America are covered by managed care plans, including health maintenance organizations (20 percent) and preferred provider organizations (44 percent). In contrast, only 29 percent of employees were enrolled in managed care plans in 1988 and only 47 percent in 1991. To date, the primary reason for this incredible growth in managed care has been economic-market pressure to reduce health care costs. For the foreseeable future, political pressures are likely to fuel this growth, as managed care is at the center of President Clinton's national health care plan. Although there are numerous legal issues surrounding managed care, this article focuses primarily on antitrust implications when forming managed care entities. In addition, the corporate practice of medicine doctrine, certain tax issues, and the fraud and abuse laws are discussed.

The Internal Revenue Service is attempting to reclassify many physicians as hospital employees rather than as independent contractors. Reclassifying physicians as employees could leave thousands of physicians and hospitals facing costly employment tax audits and owing millions of dollars in back taxes and penalties. In addition, some hospital pension and benefits plans that have misclassified physicians could be invalidated, and substantial penalties could be imposed on hospitals.