Columbia, SC - The South Carolina Supreme Court ruled today in Joseph v. South Carolina Department of Labor, Licensing and Regulation (2016) that physicians in South Carolina may employ physical therapists and refer patients to that physical therapist. This ruling overturned an earlier decision which found that physician employed physical therapy violated South Carolina Statutes.
In Joseph, the Court stated: "We now recognize that the interpretation of Sloan creates an absurd situation by strictly prohibiting physician-PT employment relationship without considering the resulting ethical implications or patient wellbeing." The Court's holding, that section 45-110(A)(1) of the South Carolina Code only prohibits referral-for-pay situations (i.e. anti-kickback), brings the Palmetto State into line with federal law which permits Medicare providers to refer patients to in-house physical therapy and advanced imaging services. The Court's ruling drops the number of states banning physician owned physical therapy services down to three. Colorado, Delaware, and Missouri are the only states that ban the practice.
Three plaintiff's (formally known as appellants since this was an appeal of a Circuit Court ruling) fought the anti-competitive Sloan ruling, two physicians and one physical therapist. One of the physicians is employed at AAOE member practice Carolina Orthopaedic Surgery Associates and the other plaintiffs relocated to Georgia following the initial Circuit Court ruling against the plaintiff's. The American Physical Therapy Association, which has waged a 35 year war on physician-owned physical therapy, and its South Carolina chapter were respondents in the suit.