New legislation has now passed in two committees to add physical therapists to the list of professionals allowed to be employed by non-professionals.
As of April 5th, AB 783 (Hayashi Bill) has now passed, unanimously in both cases in the Assembly of Business and Professions and the Assembly of Business, Professions and Consumer protection.
The new legislation will circumvent the intention of California's Moscone-Knox Professional Corporations Law that passed in 2003, which is to protect the actions of professional from being corrupted by corporate business interests, primarily motivated by profit.
The main corporate business interest employing physical therapists is physicians, podiatrists and chiropractors.
Until now, California has been viewed as having one of the stronger professional corporations laws in the country.
"Existing law regulating professional corporations provides that certain healing arts practitioners may be shareholders, officers, directors, or professional employees of a medical corporation, podiatric medical corporation, or a chiropractic corporation, subject to certain limitations.There is heated debate on both sides of this issue: physicians affirm their right to practice medicine, including physical therapy, within their professional license.
This bill would add licensed physical therapists and licensed occupational therapists to the list of healing arts practitioners who may be shareholders, officers, directors, or professional employees of those corporations."
Physical therapists oppose AB 783 mainly as an issue of costs - physicans who own their own physical therapy clinics drive up service volume by 30% and reimbursement by 40%.