Structuring Telemedicine Agreements for Healthcare ...media.straffordpub.com/products/structuring... · 4/10/2019 · Structuring Telemedicine Agreements for Healthcare Organizations,

Structuring Telemedicine Agreements for

Healthcare Organizations, Physician Groups

and Telemedicine PractitionersRegulatory Compliance and Corporate Practice of Medicine Issues, Key Provisions

Today’s faculty features:

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WEDNESDAY, APRIL 10, 2019

Presenting a live 90-minute webinar with interactive Q&A

Marshall E. Jackson, Jr., Attorney, McDermott Will & Emery, Washington, D.C.

Ryan S. Johnson, Shareholder, Fredrikson & Byron, Minneapolis

Erin S. Whaley, Partner, Troutman Sanders, Richmond, Va.

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STRUCTURING TELEMEDICINE AGREEMENTS FOR HEALTHCARE ORGANIZATIONS, PHYSICIAN GROUPS AND TELEMEDICINE PRACTITIONERS

Marshall E. Jackson, Jr.

McDermott Will & Emery, LLP

[email protected]

(202) 756-8019

mwe.com

THE DIGITAL HEALTH ECOSYSTEM

• Each is an interrelated and integrated component of a

“digital ecosystem”

• The lines of distinction between each can be blurry

and solutions are rapidly becoming combinations of

two or more of these components

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DEFINING TELEMEDICINE

• “The use of medical information exchanged from one site to another via

electronic communications to improve a patient’s clinical health status.”

~American Medical Association

• Interactive services: Asynchronous and synchronous interaction

between provider and patient, via phone, video chat or text for diagnosis,

consultation, treatment, education and care management

• Remote monitoring: Devices used to monitor patients, chronic

diseases, record vital signs and improve medication adherence

• Store-and-forward: Transmission of medical data, such as images, to a

physician for assessment

• Examples:

– Telestroke

– Teleradiology

– Tele-ICU

– Teledermatology

– Home Health: remote monitoring

– Consultations/second opinions (P2P or DTC)

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DEFINING TELEMEDICINE

• There is no uniform definition of telemedicine State regulatory constructs will partially dictate what constitutes telemedicine:

• Federation of State Medical Boards – The practice of medicine using electronic communications, information technology or other means between a licensee in one location, and a patient in another location with or without an intervening healthcare provider. Generally, telemedicine is not an audio-only, telephone conversation, e-mail/instant messaging conversation, or fax. It typically involves the application of secure videoconferencing or store and forward technology to provide or support healthcare delivery by replicating the interaction of a traditional, encounter in person between a provider and a patient.

• Florida (broad) – The practice of medicine where patient care, treatment, or services are provided through the use of medical information exchanged from one site to another via electronic communications.

• Louisiana (narrow) – The practice of health care delivery, diagnosis, consultation, treatment, and transfer of medical data using interactive telecommunication technology that enables a health care practitioner and a patient at two locations separated by distance to interact via two-way video and audio transmissions simultaneously.” La. Rev. Stat. § 37:1262(4).

• “Telemedicine” vs. telehealth, mobile health, digital health, virtual care

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BE PREPARED FOR THE PERFECT STORM OF REGULATORS

• Safety of Patients/Research Subjects

– Medical Devices

– Health IT

– Licensure and Credentialing

• Patient/Consumer Data

– Privacy

– Security

– Accuracy/Integrity

– Inappropriate commercial exploitation

• Patient/Consumer Transparency (Consent and Choice)

– Deception

– Misrepresentation

– Unfair practices

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DRIVERS OF INNOVATION

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EXAMPLE BUSINESS MODELS

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• Provide the tools needed to facilitate telemedicine encounters

• Potential manufacturers of medical devices

Equipment and Software

Producers

• Provide healthcare services• Direct to consumer; extension of existing

providers; insurance benefit; wellness; etc.

Telemedicine Companies

• More specialized uses (e.g., telestroke; tele-ICU; second opinion; etc.)

• Telemedicine a part of a larger platform• Institution–to–Institution; Clinician–to–Clinician

Traditional Providers

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ILLUSTRATION OF PATIENT ENGAGEMENT

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LEGAL AND REGULATORY CONSIDERATIONS

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LEGAL AND REGULATORY CONSIDERATIONS

• Licensure (including non-physician professionals)

• Informed Consent

• Scope of Practice and Standard of Care (including remote prescribing)

• Privacy and Security

• Revenue Model

• Fraud and Abuse

• Reimbursement

• Consumer protection laws (FTC and state AGs)

• Risk Mitigation

• Corporate Practice of Medicine

• Medical Device Regulations

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CONSIDERATION FOR INTERNATIONAL TELEMEDICINE ARRANGEMENTS

• Consultation vs. Direct Care

– Foreign countries may restrict a U.S. based provider’s ability to render direct care

to patients using telemedicine (E.g., China)

• Licensure Requirements

– Foreign countries may require that the U.S. based provider be licensed to practice

in its jurisdiction

For example, Dubai requires that any natural or legal person shall not establish, operate

or provide telehealth services in the Emirate, unless a profession practicing license is

obtained from the Dubai Health Authority. DHA Regulations, effective February 21, 2017.

– A license to do business in the foreign country may be required.

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EXAMPLES OF TYPES OF AGREEMENTS

• Telemedicine Services Agreement

• Credentialing and Privileging Agreement

• Equipment Lease or Purchase Agreement

• Technology or Software Licensing or Purchase Agreement

• Technology Service Agreement

• Data Use Agreement

• Business Associate Agreement

• Management Services Agreement

• Collaborative or Supervising Agreement

• Website Terms of Use and Privacy Policy

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SCOPE OF PRACTICE

• General consensus is that all treatment provided via telemedicine will be held to the same standard as face-to-face encounters

• State medical boards regulate or have issued guidance on the circumstances surrounding when telemedicine may be used to provide care

• For example, some states have adopted regulations or guidance that governs:

– where a consult takes place (e.g., patient’s home, medical facility)

– what technologies are used (e.g., videoconferencing technology, email, internet)

– when a physician examination of the patient is required (and depending on the state, this examination

may need to be performed in-person – not virtually using videoconferencing technologies)

– when a physician may issue a prescription

• Due to the variation between states, a state-by-state analysis is necessary

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CONTRACT CONSIDERATIONS: PROVISION OF SERVICES (SCOPE OF PRACTICE)

• Map out the telemedicine practice standards for the desired telemedicine arrangement and ensure an understanding of what can and can’t be done by providers treating patients in that state– What services will be provided?

– Which types of providers will provide the service? At which location (if facility based) and when?

– Will the other contracting party assist in the implementation of the service? If so, to what extent.

– Will support staff be designated to facilitate telemedicine services? Who will provide training to the

staff?

– Who will develop any clinical protocols for use by any telemedicine provider and any licensed

support staff? Who will ensure maintenance of necessary licenses, accreditation, credentialing?

– Who is responsible for maintaining patient EHRs?

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CONTRACT CONSIDERATIONS: EQUIPMENT AND TECHNOLOGY

Telemedicine Services Agreements

• Purchasing, Installation and Maintenance

– Who is responsible for purchasing, installing and/or

maintaining telemedicine equipment?

• State technology requirements compliance

• Access to support services, technology updates, what to do

if technology goes down

• Education and Training

– What education and training is needed to use

telemedicine technology and provide telemedicine

services? Who will assess education, training and

competence?

• Example language:

– Party A will provide training prior to commencement of

telemedicine services to Party B’s designated support

staff, nursing staff, and providers, which includes an

overview of the provision of care via telemedicine, review

of work flow (general to the consult and specific to each

discipline), technology overview, and use of the

telemedicine equipment and troubleshooting.

Vendor Equipment/Software Agreements

• Licensing Terms

– Exclusivity, termination provisions, indemnification,

etc.

• Inter-operability

– Compatible with standard technologies – mobile,

Mac/PC, browser compatibility, etc.

• Up Time / Down Time

• Access to support services, technology updates

• Have vendor represent and warrant technology’s

compliance with regulatory requirements

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FRAUD AND ABUSE

• Telemedicine arrangements must comply with state and federal fraud and abuse laws

• To illustrate, some examples of various telemedicine arrangements that may create fraud and abuse compliance challenges:

– Providing telemedicine equipment for free or at a reduced cost to a facility or physician that is an

actual or potential referral source

– Payment of a subsidy from one telemedicine network participant to another for the purchase of

equipment or software, or for professional services

– Billing for services that were not properly supervised

– Billing patients for services that are covered by his/her third party payor

– Providing free or discounted telemedicine equipment of software to consumers who are potential

patients

• Advisory opinions issued by the Office of Inspector General provide valuable guidance for providers and entrepreneurs when structuring telemedicine arrangements

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CONTRACT CONSIDERATIONS: REIMBURSEMENT AND COMPENSATION

• Billing requirements vary by payor / state

– Who is billing and collecting for telemedicine services rendered to patients?

– Medicare / Medicaid

Do services qualify as covered telemedicine services?

Does the arrangement meet the requirements of applicable federal or state healthcare program reimbursement

requirements and applicable fraud and abuse laws?

– Commercial Payors

Does the state require commercial coverage of services provided via telemedicine?

Does the billing provider’s contracts reflect said coverage and include negotiated payment amounts?

• Compensation

– Ensure compensation covers all aspects of the arrangement (e.g., provider services, technology/software, maintenance,

support services)

– Analyze compensation with sensitivity to applicable fraud and abuse laws.

• Example language:

– In consideration for the telemedicine services provided pursuant to this Agreement, Party B shall pay Party A [$], which the

parties believe constitute fair market value based on arms’ length negotiations and not related in any way to the value or

volume of referrals between the Parties. Party B is responsible for billing the professional and, if applicable, technical fees, to

the extent permitted by applicable third party payor billing rules.

4/5/201921

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CONTRACT CONSIDERATIONS: INTELLECTUAL PROPERTY

• Determine ownership of existing and new intellectual property– Who owns the existing intellectual property?

– Who owns any derivative intellectual property or modifications?

– What about intellectual property create in a telemedicine providers own time?

• Example language: – Party A owns all right, title and interest in and to the Party A’s biomarker panel, clinical pathways and such other

proprietary technology and information, as set forth in that certain License Agreement between the Party A and

Party B, including but not limited to all intellectual property rights related thereto and any future enhancements,

modifications or improvements (including derivative works) that Party A or Party B creates based on the proprietary

technology (together, the “Party A IP”). Party B hereby expressly assigns to Party A all of Party B’s right, title, and

interest of every kind and nature in and to the Party A IP, without further consideration, and free from any claim or

rights of retention on the part of Party B, including all author’s rights, the right to prepare, reproduce and distribute

copies, compilations, and derivative works, all rights to causes of action or remedies related thereto, and all causes

of action heretofore accrued in Party B’s favor for infringement of the Party A IP, and the right to assign or license

the Party A IP. Party B agrees to execute all documents that may, in Party A’s sole discretion, be required to

perfect such assignment. Party B further agrees that all patent, trade secret or trademark rights in any Party A IP

will be the sole and exclusive property of the Party A as of the date of creation or conception.

4/5/201922

Telemedicine and Telehealth

Ryan S. Johnson, Esq.

[email protected]

(612) 492-7160

© 2017 Fredrikson & Byron, P.A.23

Licensure

• Practitioners must meet licensing requirements in the state where the patient is located.

• Key issue in any telemedicine arrangement.

• State laws regarding telemedicine vary:– Some state licensing laws directly address telemedicine

and explicitly define the practice of telemedicine.

– Some states laws indirectly address telemedicine by defining the practice of medicine to include diagnosing or recommending treatment through electronic means.

– Some states are silent.


Licensure/Scope of Practice


Licensure

• Some states require full licensure of practitioners providing telehealth services to patients in state.

– “Active” or in-state practice requirements

• Some states have special telemedicine licenses State Licensure Exceptions:

– Physician-to-physician consults

– “Infrequent” or “occasional” consultations


Scope of Practice

• Use of non-physician practitioners increasing

– In telemedicine context, this raises issues regarding scope of practice, supervision, and prescriptive authority.

• Other considerations:

– Written collaborative agreement requirements

– Protocols

• Nurse Licensure Compact


Physician Supervision

• Levels of Supervision:

– General supervision: Procedure must be furnished under physician’s direction and control, but physician’s presence not required.

– Direct supervision: Physician must be present in office suite and immediately available.

– Personal supervision: Physician must be in attendance in room during procedure.


Physician Supervision

• Direct supervision/on-site requirements can significantly impact telemedicine arrangements.

• Is remote supervision acceptable?

– Non-physician practitioner and patient in same location, but supervising physician off-site.

• Must review state requirements

– Physician/non-physician practitioner practice ratios


Prescriptive Authority

• Issues surrounding prescribing medication electronically in connection with telehealth encounters.

• Permissibility of remote prescribing varies significantly across states

– State pharmacy statutes and regulations

– Licensing board policy

– Medicaid reimbursement policies


Prescriptive Authority

• State prescribing requirements that create biggest hurdles in telemedicine context:

– Face-to-face encounter

– Physical examination

– Existing physician-patient relationship

– Controlled substances

• Efforts to clarify requirements/change law and accommodate online consultations.


Privacy and Security

• HIPAA

• HITECH

• State Laws and Regulations



• HIPAA’s Applicability

– Covered Entities

– Business Associates

• Protected Health Information

– Individually identifiable information (written, electronic, or oral) created or received by a provider;

– Relating to an individual’s health, provision of health care to an individual, or payment for health care;

– That identifies the individual or provides a reasonable basis to identify the individual.



• Telemedicine providers billing for telemedicine services must

– comply with HIPAA and state confidentiality and privacy rules for protection of protected health information

– ensure policies and procedures are in place to prevent unauthorized use or disclosure

– provide notice of a breach when needed



• Telemedicine Providers must maintain:

– Business Associate Agreements

– Patient Consents

– Patient Rights for Telehealth Encounters Forms


Business Associates

• Who is a Business Associate?– person, other than a workforce member, who creates,

receives, maintains, or transmits PHI on behalf of a Covered Entity, or who provides services to or for the Covered Entity, which involves the disclosure of PHI

• Business Associates are directly and contractually liable for violations of HIPAA rules and regulations.


Business Associate Agreements

• Required Provisions

• Optional Provisions



• HIPAA Security Rule

– Requires implementation of administrative, physical, and technical safeguards to protect electronic PHI.

– Covered entities and business associates must:

• Ensure the confidentiality, integrity and availability of ePHI that it creates, receives, maintains or transmits;

• Protect against reasonably anticipated threats or hazards to the security or integrity of ePHI;

• Protect against impermissible uses or disclosures; and

• Ensure compliance by all workforce members.



• Must also consider state laws that apply to telemedicine arrangements.

• Applicable state laws may be more stringent than HIPAA.

• Some states have recordkeeping and privacy laws relating specifically to telehealth encounters.


Corporate Practice of Medicine



• Corporate practice of medicine (“CPM”) doctrine prohibits corporations from employing medical professionals or owning/controlling medical practices.

• Intended to prevent lay persons from exerting control or influence over physician medical decision-making.

• CPM prohibition has been widely criticized.



• Based on state statute, case law, attorney general opinions, board policies, etc.

• Enforcement of CPM prohibition varies

– Some states are more active (e.g., CA, NY)

• Exceptions vary by state

– Hospitals

– Entities owned solely by licensed professionals



• Potential ramifications for CPM violations



• Potential solutions to CPM problem:– If state CPM prohibition applies to telemedicine

arrangement, management company model may be an option.

– Professional entity is responsible for clinical functions.

– Management company is responsible for non-clinical functions under management services agreement.


Fee-Splitting

• Many States Prohibit Fee-Splitting

– Perceived danger of allowing professionals and non-professionals to share in income from professional services:

• Temptation to maximize profit through medically unnecessary services.

• Temptation to limit medically necessary services to maximize income.


Federal Anti-Kickback Statute

• Prohibits offering, paying, soliciting or receiving any remuneration in return for

– business for which payment may be made under a federal health care program; or

– inducing purchases, leases, orders or arranging for any good or service or item paid for by a federal health care program.

• Remuneration includes kickbacks, bribes and rebates, cash or in kind, direct or indirect.



• Potential penalties for violations of anti-kickback statute:

– Criminal and civil penalties

– Imprisonment

– Civil Monetary Penalties

– False Claims Act exposure



• Telemedicine relationships requiring anti-kickback analysis:

– Relationships with supervising/collaborating physicians

– Relationships with other entities (management company, telemedicine entity, equipment/technology vendor, etc.)



• No issue if federal health care program reimbursement is not involved.

– BUT remember to consider state anti-kickback prohibitions.

• Safe harbor protection

– space rental, equipment rental, personal services and management contracts, etc,

• Advisory opinions


Self-Referral Prohibitions

• Federal Stark law prohibits a physician from making a referral for designated health services (“DHS”) to an entity with which the physician (or an immediate family member) has a financial relationship, unless one of its many exceptions applies.

• Stark also prohibits entities from submitting claims for DHS provided pursuant to a prohibited referral.


Self-Referral Prohibitions

• Stark is a strict liability statute, meaning that the intent of the parties is irrelevant for purposes of determining whether the law has been violated.

• Stark provides for monetary penalties and requires the refund of amounts paid for illegally referred DHS.


Self-Referral

• Telemedicine arrangements that involve free/discounted equipment or services, volume discounts, “per-click” payments, or advertisements should be analyzed for possible self-referral issues

• Possible exceptions: lease arrangements personal services arrangements, etc.

• Remember state law


Patient/Physician Relationship

• State Law Governs

– Establishment of Relationship

– Informed Consent

• requirements

• when and how obtained


Risk Allocation & Mitigation in Telehealth Contracts

Erin Whaley

Partner

[email protected]

Reps, Warranties and Disclaimers

Vendor shall:

(a) perform the Services using personnel of required skill, experience and qualifications and in a professional and workmanlike manner in accordance with generally recognized industry standards for similar services and shall devote adequate resources to meet its obligations under this Agreement;

(b) comply in all material respects with all applicable federal, state and local laws, statutes, ordinances, rules and regulations within the United States and shall hold all permits, licenses and similar authority necessary for Vendor’s business and the performance of Services hereunder;

(c) ensure that the Services will be free of any time bomb, viruses, trap doors, back doors or other code which destroys, erases, damages or disrupts the normal operations of, or allows for unauthorized access to, protected health information;

(d) DISCLAIMER OF WARRANTIES. VENDOR DOES NOT WARRANT THE SERVICES WILL BE UNINTERRUPTED OR ERROR-FREE. ALL INFORMATION, MATERIALS, AND SERVICES ARE PROVIDED TO CUSTOMER “AS IS.” EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT, VENDOR HEREBY DISCLAIMS ALL REPRESENTATIONS AND WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NON-INFRINGEMENT.

Performance Warranty

Can be customized for the specific services being rendered

If there are SLAs, add that Services will be provided in accordance with the SLAs

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Vendor shall:





Compliance with Laws Warranty

Can list specific laws or remain broad

Knowledge or level of effort qualifiers

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Vendor shall:





Security Warranty

Not necessary for professional services only

Customize for specific type of software involved (app vs. hardware)

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Vendor shall:





Disclaimers are relatively standard

Often paired with limitation of liability

Example is basic but may be much more detailed

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Indemnification

Vendor shall indemnify and hold harmless Customer, its successors and assigns, from and against any and all liabilities, losses, claims, suits, causes of action, demands, costs, damages, expenses (including, without limitation, court costs, reasonable attorneys’ fees and expenses, costs of travel, interest expense and amounts paid in compromise or settlement of any losses, claims or suits),

judgments or obligations arising or resulting from or in connection with (i) a breach by Vendor of this Agreement or (ii) any third party claim, demand, suit or proceeding against Customer, or any of its respective officers, directors, employees, agents and third party vendors for infringement or misappropriation of such third party's intellectual property rights arising from any software provided by

Vendor to Customer hereunder. Vendor shall at its expense: (i) procure the right for Customer to continue using the infringing software, or (ii) promptly replace the infringing software with a non-infringing version of equivalent function, features, characteristics

and performance or (iii) modify the software to be non-infringing without detracting from function or performance.

Each Party (the “Indemnifying Party”) agrees to defend, indemnify and hold the other party (the “Indemnified Party”) harmless from and against any and all losses, liabilities, damages, expenses,

bodily injuries, costs or obligations of any kind (including reasonable attorneys’ fees and disbursements) (“Losses”) from any third party claim, suit, action or proceeding (each, a “Claim”) to

the extent arising from the Indemnifying Party’s material breach of any representation or warranty set forth in this Agreement. Vendor will also indemnify Customer for any Claims alleging medical

malpractice by Vendor Providers in connection with a Vendor Provider’s performance of the Services, or that Vendor’s intellectual property infringes any intellectual property rights of a third party. The

Indemnifying Party’s obligation with respect to Losses shall be subject to the Limitation of Liability.

Vendor shall protect, indemnify and save Customer and the directors, officers, shareholders and

employees of Customer harmless from and against any and all liability and expense of any kind, arising from injuries or damages to persons or property in

connection with the provision of the Services, unless such liability results solely from the willful

misconduct of Manager and/or its directors, officers, shareholders, employees or agents.

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Indemnification

Vendor shall indemnify and hold harmless Customer, its successors and assigns, from and against any and all liabilities, losses, claims, suits, causes of action, demands, costs, damages, expenses (including, without limitation, court costs, reasonable attorneys’ fees and expenses, costs of travel, interest expense and amounts paid in compromise or settlement of any losses, claims or suits),





bodily injuries, costs or obligations of any kind (including reasonable attorneys’ fees and disbursements) (“Losses”) from any third party claim, suit, action or proceeding (each, a “Claim”) to

the extent arising from the Indemnifying Party’s material breach of any representation or warranty set forth in this Agreement. Vendor will also indemnify Customer for any Claims alleging medical

malpractice by Vendor Providers in connection with a Vendor Provider’s performance of the Services, or that Vendor’s intellectual property infringes any intellectual property rights of a third party. The

Indemnifying Party’s obligation with respect to Losses shall be subject to the Limitation of Liability.





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Indemnification

Vendor shall indemnify and hold harmless Customer, its successors and assigns, from and against any and all liabilities, losses,claims, suits, causes of action, demands, costs, damages, expenses (including, without limitation, court costs, reasonable attorneys’ fees and expenses, costs of travel, interest expense and amounts paid in compromise or settlement of any losses, claims or suits),





bodily injuries, costs or obligations of any kind (including reasonable attorneys’ fees and disbursements) (“Losses”) from any third party claim, suit, action or proceeding (each, a “Claim”) to the extent arising from the Indemnifying Party’s material breach of any representation or warranty set forth in this Agreement. Vendor will also indemnify Customer for any Claims alleging medical malpractice by Vendor Providers in connection with a Vendor Provider’s performance of the Services, or that Vendor’s intellectual property infringes any intellectual property rights of a third party. The Indemnifying Party’s

obligation with respect to Losses shall be subject to the Limitation of Liability.





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Indemnification

Vendor shall indemnify and hold harmless Customer, its successors and assigns, from and against any and all liabilities, losses,claims, suits, causes of action, demands, costs, damages, expenses (including, without limitation, court costs, reasonable attorneys’ fees and expenses, costs of travel, interest expense and amounts paid in compromise or settlement of any losses, claims or suits),





bodily injuries, costs or obligations of any kind (including reasonable attorneys’ fees and disbursements) (“Losses”) from any third party claim, suit, action or proceeding (each, a “Claim”) to the extent arising from the Indemnifying Party’s material breach of any representation or warranty set forth in this Agreement. Vendor will also indemnify Customer for any Claims alleging medical malpractice by Vendor Providers in connection with a Vendor Provider’s performance of the Services, or that Vendor’s intellectual property infringes any intellectual property rights of a third party. The Indemnifying Party’s

obligation with respect to Losses shall be subject to the Limitation of Liability.




misconduct of Customer and/or its directors, officers, shareholders, employees or agents.

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Restrictive Covenants

Non-solicitation, non-compete, non-

disclosure

Reasonableness, time, geographic

scope, scope of services

State law specific

Liquidated damages or buy-out

provisions

(a) General. Vendor expressly acknowledges that it will be given access to, and be provided with, business methods, trade secrets and other proprietary information, including without limitation patient lists and business strategies, in connection with Services. Vendor expressly acknowledges and agrees that the Confidential Information is proprietary and confidential and if any of the Confidential Information was imparted to or became known by any persons such disclosure would result in hardship, loss, irreparable injury and damage to Customer, the measurement of which would be difficult, if not impossible, to determine. Accordingly, Vendor expressly agrees that Customer has a legitimate interest in protecting the Confidential Information, that it is necessary for Customer to protect its business from such hardship, loss, irreparable injury and damage, that the following covenants are a reasonable means by which to accomplish those purposes, and that violation of any of the protective covenants contained herein shall constitute a breach of trust and is grounds for immediate termination of this Agreement and for appropriate legal action for damages, enforcement and/or injunction.

(b) Restrictions on Soliciting Employees of Customer. Vendor covenants that, during the term of this Agreement and for a period of one (1) year immediately thereafter, irrespective of which party terminates this Agreement, and whether such termination is for cause, Vendor will not, either for itself or for any other person, firm, corporation or other entity, either directly or indirectly (a) induce, or attempt to induce, any employee of Customer or person under contract with Customer (whether leased or otherwise) to terminate his or her employment or hire away or attempt to hire away, any employee or contractor of Customer; or (b) engage in any act or activity which would interfere with or harm any business relationship Customer may have with any employee, contractor, principal, supplier or lessee.

(c) Non-Competition Covenant. Commencing with the date of this Agreement and continuing for eighteen (18) months following the cessation of Vendor’s engagement with Customer for any reason whatsoever, including the termination or expiration of this Agreement, Vendor shall not, directly or indirectly, (i) at any hospital within a fifty (50) mile radius of Customer’s location(s) perform services that are the same as or substantially similar to, and competitive with, those provided by Vendor pursuant to this Agreement.

(d) Further Covenants. Vendor acknowledges that Customer has devoted substantial time, money and effort in the development of the Confidential Information and in maintaining the proprietary and confidential nature thereof. Vendor agrees to use its best efforts and exercise utmost diligence to protect and safeguard the Confidential Information. Vendor covenants that, during the term of this Agreement and for a period of five (5) years immediately thereafter, regardless of which party terminates this Agreement and whether such termination is for cause, neither Vendor, nor any of its employees or contractors, will disclose, disseminate or distribute to another, nor induce any other person to disclose, disseminate or distribute, any Confidential Information of Customer, directly or indirectly, whether or not acquired, learned, obtained or developed by Vendor alone or in conjunction with others, nor will Vendor use or cause to be used any Confidential Information in any way except as is required in the course of Vendor’s performance of the Services pursuant to the terms of this Agreement. Vendor acknowledges and covenants that all Confidential Information relating to the business of Customer, whether prepared by Vendor or otherwise coming into its possession, shall remain the exclusive property of Customer, shall not be copied or otherwise reproduced in whole or in part, and shall not be removed from the premises of Customer under any circumstances whatsoever without the prior written consent of Customer. Vendor further covenants that all memoranda, notes, records, drawings or other documents made, compiled, acquired or received by Vendor during the term of this Agreement, concerning any business activity, including, but not limited to, management techniques, names of referral sources, names of vendors and suppliers, marketing and sales techniques, and the pricing of products and services, shall, together with all copies, be delivered, in good condition, to Customer, immediately upon termination of this Agreement by either party, or at any time, upon Customer’s request.

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Insurance

Prior to commencement of operations hereunder, Vendor will purchase and maintain the following minimum insurance as will protect it, its employees, agents, and representatives

from any claim which may arise out of Vendor’s Services under this Agreement:

Commercial General Liability Insurance on an Occurrence basis ($1,000,000 per occurrence/$3,000,000 annual aggregate)

Professional Liability ($1,000,000 per occurrence/$3,000,000 annual aggregate)

Security/Cyber/Privacy Breach Insurance ($3,000,000 per occurrence/$6,000,000 annual aggregate)

Each of Vendor and Customer shall have and maintain, at the expense of each of them respectively, a policy or policies of comprehensive general liability insurance, malpractice liability insurance and cyber or privacy data breach insurance in an amount reasonably considered as being appropriate by each of them, for the purpose of providing insurance protection for their respective operations. Upon Customer’s

request, Vendor shall arrange for the provision of certificates or other proof of existing and continuing insurance coverages, including limits, deductibles/self-retention amounts, coverage, and other provisions of such insurances, and shall include with respect to such insurance

provision for direct notice from Vendor’s insurer to Customer of any proposed changes in limits, deductibles/self-retention amounts, coverages, or other provisions of such insurance, which notice shall be given not less than thirty (30) days prior to the effective date of any such proposed changes. If such direct notice is not possible, notice of any of the circumstances described in the preceding sentence shall

be given to Customer not less than thirty (30) days prior to the effective date of any such proposed changes. Vendor shall obtain an extended reporting endorsement for claims in the event policy is cancelled or discontinued.

Each party will maintain such insurance coverage as is reasonably necessary to support its respective

indemnification obligations. Upon written request, each party shall provide evidence of such coverage to the other party. Additionally, Vendor agrees that it will

maintain appropriate professional liability insurance and obligate each Vendor Provider to have medical or professional malpractice insurance coverage. All

insurance must be with an insurance carrier authorized to do business in the [Customer’s state of operation].

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Documents

Structuring Telemedicine Agreements for Healthcare ...media.straffordpub.com/products/structuring... · 4/10/2019 · Structuring Telemedicine Agreements for Healthcare Organizations,