The board held that the return on the physicians' investment would be proportionate to ownership interest, and, therefore, would not violate the fee splitting statute.
While the fast developing PPM industry may have taken comfort from these early declaratory statements, the board has held most recently that several other business arrangements constitute prohibited fee splitting. In 1990, the board ruled on a petition for declaratory statement that described a business corporation providing office space, staff, equipment, billing services, and marketing services of Dr.
The board held that this was "classic fee splitting," because it was based purely on billings for physician services without any relationship to the cost of those services, and because the deal included hospital as well as office services.
More specifically, this court has held that a 10 percent management fee chiropractors paid to Practice Management Associates, Inc., for marketing and consulting services furnished to chiropractors establishing their clinics was not unlawful either under the Illinois fee splitting statute, or under the Florida Chiropractic Act's fee splitting statute, F.S.
The concept that the company's percentage compensation for managed care networking and contracting services could constitute illegal fee splitting threatened to upset the market-created status quo that has driven the proliferation of PPMs in Florida.
Staff gave an opinion that the fee arrangement--as described on the LawButler website--was impermissible fee splitting as it involved collecting information from clients, matching clients to a specific lawyer, charging a referral fee only when the lawyer accepted the case, and having the lawyer bill the fee back to the client.
Both the Professional Ethics Committee and the Standing Committee on Advertising voted unanimously that the proposed fee arrangement was impermissible fee splitting.
At its May meeting, the BRCPE deadlocked 4-4 over whether the practice would be impermissible fee splitting with a nonlawyer, and recommended that the issue be referred to the Special Committee on Lawyer Referral Services.
At its July meeting, the BRCPE reconsidered the issue and voted 4-3 to recommend to the board that LawButler's plan did constitute fee splitting.
"It's got unlicensed practice of law issues, it's got fee splitting
," said committee member David Deehl.
Barnett said as early as the 1920s, the Canons of Ethics prohibited MDPs and cautioned lawyers against being "controlled or exploited by any lay agency, personal or corporate, which intervenes between client and lawyer." Those prohibitions have bean codified in the Model Code of Professional Responsibility and Rule 5.4 (which embodies the prohibitions on fee splitting
and partnerships) has been adopted in some version by almost every jurisdiction except the District of Columbia.
is the heart of the MDP debate," he said.