MedEsthetics magazines offers business education and in-depth coverage of the latest noninvasive cosmetic procedures for physicians and practice managers working in the medical aesthetics industry.
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20 MARCH 2016 | Med Esthetics © GETTY IMAGES LEGAL ISSUES | Practices that would like to add noninvasive cosmetic treat- ments or expand their offerings to include ancillary services, such as esthetics or massage, often need to bring in additional, specially trained providers. Hiring these providers as indepen- dent contractors rather than employees may help you save money on labor costs and reduce liability while providing more fl exibility in hiring and scheduling. However, simply preparing a contract and calling it an independent contractor agreement will not automatically classify the individual as an independent contractor, nor will this classifi cation automatically protect your business. On the following pages, we will examine which medical and nonmedical providers can provide contract services within a medical practice and offer guidance on issues that should be addressed in contractor agreements to help you create a winning relationship that will build rather than detract from your practice success. WHO CAN BE CLASSIFIED AS A CONTRACTOR? Whether a person is an independent contractor versus an employee is a legal classifi cation used by the federal and state government to determine whether taxes, workers' A Winning Relationship Crafting an independent contractor agreement for extenders and ancillary providers. compensation, Social Security, Medicare and unemployment taxes should be paid on the individual's behalf. It is also used to determine liability since an employer is vicariously liable for the acts of an employee—but not necessarily so with an independent contractor. Understanding this distinction and preparing the appropriate contract to govern the relationship will help you avoid costly legal consequences. Generally, an independent contractor invoices for work completed and has more than one client. Independent contractors have their own tools and set their own hours. They also keep their own business records and have their own Federal Employer Identifi cation Numbers. Typically these providers operate under a different business name and they are responsible for paying their own taxes, workers' compen- sation and for maintaining their own insurance coverage. In contrast, an employee performs duties dictated or controlled by others, is given training for work to be done and works for only one employer. The work is typically continuous and an essential element of the employer's business. There is no single test to determine whether an individual is an employee or an independent contractor. However, one of the most critical determining factors is the degree of By Allyson Avila