Can a Physician Have Too Many Collaborative Agreements?

In many states, collaborative agreements allow advanced practice providers and other healthcare professionals to expand their scopes of practice. Learn the basics of collaborative agreements and consider how many such agreements a physician can reasonably enter.

A collaborative agreement is a contract between parties that want to work together on a project. In healthcare, it typically cements the working relationship between a supervisor and supervisee. It outlines the scope of responsibility for each party and allows the supervisee to increase their scope of practice.

Each collaborative agreement is different. After all, it must address the specifics of the situation. But at a minimum, a collaborative agreement should include:

• Background information such as party names, locations, and license information
• The responsibilities of each party, including what each party must do, under what circumstances each party can terminate the relationship, and how the supervisee will pay the supervisor
• Specific language to show how the relationship will comply with local practice laws and regulations, such as how and when the supervisor will provide on-site supervision if the state requires it
• Indemnification and Arbitration language, i.e., under what circumstances will the supervisor be liable for the supervisee’s behavior (and vice-versa) and how will the parties settle disputes. 

Collaborative Agreements In Action

Advanced Practice Registered Nurses (APRNs), such as nurse practitioners, find collaborative agreements useful in states that limit their ability to practice independently. In such states, the APRN can only provide certain patient services. Beyond that, the APRN needs to designate a physician supervisor via a collaborative agreement.

For example, The Illinois Nurse Practice Act specifies that APRNs can only provide patient care independently in specific settings. Therefore, all APRNs engaged in clinical practice outside of a hospital or ambulatory surgical treatment center must do so under a written collaborative agreement. The physician does not need to be physically present with the APRN. However, the physician must be available by phone for consultation. In addition, the physician must physically visit the clinic to meet with the APRN at least monthly. 

Collaborative agreements can also expand the services of other healthcare professionals. In Texas, for example, a physician may delegate to a pharmacist the implementation and modification of a patient’s drug therapy under protocol. Collaborative agreements can also help physician assistants and prescribing psychologists widen their practice authority.

Each state has its own rules. Providers should consult with a healthcare attorney to determine whether a collaborative agreement makes sense in their legal landscape.

Can You Have Too Many Collaborative Agreements?

Ideally, collaborative agreements help control costs and increase access to care. In addition, they can facilitate interdisciplinary teams and result in improved patient outcomes. But what happens if a physician enters too many collaborative agreements and cannot give adequate supervision?

Physician Liability for Poor Patient Care

Even if the collaborative agreement does not expressly state the physician can be liable for the supervisee, a court may hold the physician vicariously liable due to implied agency. Implied agency focuses on the behavior between the parties to a contract. In deciding if the physician is liable, a court will consider the physician’s degree of control over the supervisee — the more control, the more likely the physician will be liable. 

The case Ruggiero v. Miles exhibits how a physician can be held liable for the actions of a clinician under their supervision. A patient was injured after a nurse practitioner misdiagnosed his condition. The patient sued the NP and the collaborating physician. The New York court held the physician liable for the nurse practitioner’s negligence due to the amount of control he had over the NP. How did the court assess this level of influence? Among other things, the collaborative agreement stated that the physician’s decision would rule in the case of a dispute. The lesson: the language of the agreement itself can introduce liability.

A physician may also be held liable due to apparent authority. Here, the physician does not necessarily control the supervisee in any way. The apparent agency is not based on the relationship between a clinician and the supervising physician; instead, it is based on the reasonable reliance by a third party. 

In other words, the physician may be liable if, from the patient’s perspective, it is reasonable to think the physician was using a nurse practitioner or other clinician as an agent to offer services — that is, that they were the physician’s employee. 

Finally, signing too many collaborative agreements increases the physicians’ risk of being called on to offer guidance or supervision in areas outside their field of expertise. Physicians practicing in unfamiliar specialties can result in poor outcomes for patients and lawsuits for providers. 

Statutory Limitations

State law may cap the number of collaborative agreements physicians can enter to prevent them from stretching themselves too thin. Physicians must be available to review charts and medical records periodically, communicate with supervisees, and provide medical guidance. Statutory limitations, then, recognize that physicians are humans with finite capacity. 

In Illinois, for example, a physician may enter into no more than seven collaborative agreements delegating responsibility to a physician assistant, with exceptions for hospital settings, hospital affiliates, or ambulatory surgical treatment centers. However, a physician may collaborate with more than seven PAs in certain federal primary care health professional shortage areas. 

Missouri and Georgia limit each physician to three APRN collaborative agreements. Florida allows a physician to supervise an APRN offering primary care at no more than four satellite offices. For specialty care, Florida limits supervision to two satellite offices.

As states grapple with growing physician shortages, expect legislatures around the country to revisit their limits. Consult a healthcare attorney in the state where you operate to know the requirements in your area.

Before entering into any contract, including a collaborative agreement, you should enlist the help of an experienced attorney. Jackson LLP has licensed healthcare attorneys in several states. If you need legal support and operate in one of the states where we practice, you can schedule a free consultation. During the session, we’ll establish how well we fit your needs.

This blog is made for educational purposes and is not intended to be specific legal advice to any particular person. It does not create an attorney-client relationship between our firm and the reader. It should not be used as a substitute for competent legal advice from a licensed attorney in your jurisdiction.