The Texas Medical Board rejected a complaint and an appeal filed by two emergency physicians who claimed that one of the Lone Star's own was skirting the intent of the prohibition on the corporate practice of medicine in the state.
The complaint named Gregory Byrne, MD, an emergency physician from Mexia, TX, as a “sham owner of numerous professional entities of Envision Healthcare Corporation, a lay entity” that “directly aids and abets improper lay control over medical practice.”
The Texas Medical Board reviewed the complaint but declined to investigate because the “initial review provided for in Sec. 154.058 does not indicate that the actions referenced...fall below the acceptable standard of care,” it said in a Feb. 1, 2022, letter rejecting the complaint. The section cited refers in the Texas Medical Practice Act to a physician's medical competency, and had been assigned to the case by the TMB, not the complainants. (http://bit.ly/3WQPHjm.)
The Texas Medical Board wrote in its letter that there had been no violation of the act and that no further action would be taken. It did say, however, that the complainants had the right to appeal, which they did on April 19. That letter to the TMB said they did not believe the complaint had been properly addressed. “Our complaint was not about medical competency but about the prohibition on aiding and abetting the corporate practice of medicine as outlined [in the Texas Medical Practice Act] in Section 164.052 (17),” the letter said.
“This section prohibits a physician from directly or indirectly aiding or abetting in the practice of medicine by a person, association or corporation that is not licensed to practice medicine,” the complainants wrote.
“Specifically, as noted in the court document provided with our initial complaint, Dr. Gregory James Byrnes, MD, allows Envision Healthcare, which is owned by private equity, to commercialize his license by being a ‘paper owner’ of emergency department practices through a contractual scheme. Texas case law indicates this is in violation of the Texas Medical Practice Act.”
The Texas Medical Board noted on its website, “A general summary of the corporate practice of medicine doctrine is that it prohibits physicians from entering into partnerships, employee relationships, fee splitting, or other situations with non-physicians where the physician's practice of medicine is in any way controlled or directed by, or fees shared with a non-physician.” (https://bit.ly/3UG6vrx.)
The TMB also said “the Medical Practice Act authorizes disciplinary action against a practitioner for aiding or abetting, directly or indirectly, the practice of medicine by non-licensed individuals or entities.”
The physicians filing the appeal said they believed that was true of Dr. Byrne and his relationship with Envision. “Envision collects all the fees, decides who practices in the ED, sets treatment protocols and has the power to terminate physicians,” the appeal said. “A thorough investigation into this matter is warranted to ensure that the citizens of Texas are not subject to corporate influences on their medical care.
“We are confused as to how our complaint was addressed as an issue of medical competency and would be interested in hearing who performed the initial investigation and the basis for interpreting the complaint as such,” the appeal said.
The appeal was denied by the Texas Medical Board on June 9, 2022, after the disciplinary process review committee (DPRC) evaluated it for a second time, according to the board's June 10 letter, which was provided to EMN by the complainants. “After a careful review of the file and all information regarding this matter, the DPRC determined there is insufficient evidence to support a violation of the statutory laws regarding physicians.
“A secondary review has been completed and the board upholds its prior decision that there was no evidence of a violation of the standard of care. The DPRC has instructed staff that this matter be closed and remain closed for lack of evidence.”
‘House of Cards’
Robert McNamara, MD, a leader in opposing contract management groups owned by private equity and one of the complainants in the Texas action, said they decided to file the complaint in Texas because it is where Dr. Byrne is licensed.
“If you look at the AAEMPG [American Academy of Emergency Medicine Physician Group] suit against Envision, one of the central features to that lawsuit is that we believe they are using a sham professional association with a paper owner to skirt the prohibitions on the corporate practice of medicine in California,” he said. “We think the same thing is going on in Texas with Envision and TeamHealth. That's the linchpin in our case in California, that the corporation actually runs this emergency department.” (EMN. 2022;44:1; http://bit.ly/3fObFmH.)
The complaint grew out of a case in which emergency physician Raymond Brovont, MD, was fired by EmCare (now Envision) because he raised concerns about staffing issues at Overland Park Regional Medical Center in Kansas. In his appeal of his suit against EmCare, he said he told EmCare that the newly enlarged hospital and emergency department, including a separate pediatric ED, meant that requiring the solo physician in the emergency department to staff Code Blue calls in other parts of the hospital could “result in endangerment of patients.”
Dr. Brovont noted that the policy could have also put the facility in conflict with the Emergency Medical Treatment and Active Labor Act (EMTALA) and the need for timely screening patients. He also said he brought the situation to the attention of EmCare vice president Patrick McHugh, DO, according to the appeal, who on July 28, 2016, sent an email to all of the emergency physicians at Overland Park, stating that “HCA is a for-profit company traded on the New York Stock Exchange. Many of their staffing decisions are financially motivated. EmCare is no different.”
Dr. Brovont put his concerns in writing, and roughly six weeks later, the group KS-I Medical Services that employed him through Dr. McHugh fired him, the appeal said. Dr. Brovont filed suit for wrongful dismissal against KS-I and MO-I Medical Services, the EmCare subsidiaries that employed him, on April 27, 2017.
“EmCare has hundreds, if not thousands, of such subsidiaries across the United States,” he said in that filing. “Gregory Byrne, M.D., a Dallas-based physician employed by EmCare, is the sole owner of KS-I. At any given period of time, he also owns between 275 and 300 other EmCare subsidiaries in at least 20 different states. The exact number of EmCare subsidiaries he owns changes every month, and he does not keep track of them or take any management role in any of them.
“The number does not matter to him because all the profits of the subsidiaries flow to EmCare. The owners of the subsidiaries are simply paid a salary by EmCare. The payroll, human resources, legal, physician recruiting, and operation of each subsidiary was controlled by EmCare, and they would forward operational documents for the physician ‘owner’ of the subsidiary to sign.”
The court ultimately awarded Dr. Brovont $26 million in that appeal, which Envision paid him. Dr. Brovont said the suit uncovered things he did not know, and he thought the Federal Trade Commission was right to be concerned about private equity's effect on the corporate practice of medicine. The FTC conducted hearings this past spring on the effects of mergers in the health care industry. (EMN. 2022;44:1; http://bit.ly/3UOPBXX.)
“For example, there's Greg Byrne, who is supposedly the owner of these contracts,” Dr. Brovont told EMN in an interview. “I have never met him, and I frankly didn't know he existed as a doctor. He never practiced at my facility. It is a house of cards.”
EMN asked the Texas Medical Board about the complaint filed against Dr. Byrne, and its spokesperson, Jarrett Schneider, said the agency's system was down while the board was in the midst of a move to new offices, and our request for information would “be forwarded for closer review.” He added that the “agency is also bound by statutory confidentiality in that we can neither confirm or deny the existence of any complaints or disclose investigatory information.”
In its September 2022 TMB Bulletin, however, the Texas Medical Board listed the names and license numbers of physicians under a heading of “Formal Complaints,” which mostly concerned failure to meet standard of care or unprofessional conduct. Another section described disciplinary action taken against nearly 100 doctors with their names, license numbers, and an explanation of what led to the action. (https://bit.ly/3Uoo93e.)
That bulletin also included a reminder to the health care community that Texas had a Corporate Practice of Medicine doctrine, laws that prohibit certain business arrangements between physicians and non-physicians to protect a physician's independent medical judgment. “State laws prohibit physicians from entering into partnerships, employee relationships, fee splitting, or other situations with non-physicians where the physician's practice of medicine is in any way controlled or directed by, or fees shared with, a non-physician.”
The article also noted that Section 164.052 of the Medical Practice Act—the same one referenced in the complaint to the TMB about Dr. Byrne—“authorizes disciplinary action against a practitioner for aiding or abetting, directly or indirectly, the practice of medicine by non-licensed individuals or entities.”
After sending a copy of the Byrne complaint to Amanda Demarest, a spokesperson for Envision Healthcare, she emailed EMN a statement that said, “Because we have no information regarding the complaint to the Texas Medical Board, other than that it exists, we cannot comment on it. However, the dismissal of the original complaint and the appeal suggest that the allegations against Dr. Byrne were without merit.
“Envision is compliant with state laws and operates with high ethical standards that put patients' health and safety first. We follow an operating structure that is common across the healthcare sector and widely used by nonprofit, privately-held and public groups as well as hospitals and insurers. Industry-wide legal challenges to that structure have proved meritless. Envision's 25,000 clinicians exercise their independent judgment to provide quality, compassionate, clinically appropriate care based on their patients' unique needs.”
She said Dr. Byrne was not available for comment.
Ms. SoRellehas been a medical and science writer for more than 40 years, previously at the University of Texas MD Anderson Cancer Center, The Houston Chronicle, and Baylor College of Medicine. She has received more than 60 awards, including the Texas Human Rights Foundation Award. She has been a contributor to EMN for more than 20 years.