On July 26, 2024, Judge Sheldon Rennie of the Delaware Superior Court held that 24 Del. C. §2616(a)(8) was unconstitutional. The case is Kathy Callaway, PT, CHT, and Randeep Kahlon, MD v. Delaware Examining Board of Physician Therapists and Athletic Trainers, C.A. No. N23C-05-196 (Del. Super. Ct. July 26, 2024).
24 Del. C. §2616(a)(8) (the “Statute”) was enacted by the General Assembly more than 20 years ago. The Statute makes it grounds for discipline for a physical therapist or athletic trainer to have “engaged directly or indirectly in the division, transferring, assigning, rebating or refunding of fees received for professional services or who profits by means of a credit or other valuable consideration such as wages, an unearned commission, discount or gratuity with any person who referred a patient, or with any relative or business associate of the referring person.” This has been interpreted by the Attorney General to mean that physical therapists and athletic trainers cannot be employed by or contract with a referring physician or physician group.
An almost identical prohibition is contained within the licensing statute for massage therapists and technicians. And chiropractors have a similar prohibition (although there is a carve-out for relationships with physicians who work at least 10 hours per month in Delaware).
The Plaintiffs were Kathy Callaway, a physical therapist, and Randeep Kahlon, a physician. After attempts to have the Statute amended by the General Assembly failed, the Plaintiffs sued the Examining Board of Physical Therapists and Athletic Trainers (the “Board”) seeking various forms of declaratory relief, one of which was a declaration that the Statute is unconstitutional. Both parties moved for summary judgment, and Judge Rennie issued his opinion earlier this week. The Court found that the Statute is unconstitutional because it violates the principles of equal protection afforded by the 14th Amendment. Specifically, the Court found that the Statute treats physical therapists and athletic trainers differently from other similarly situated individuals. As noted by the Court, Title 24 regulates podiatrists, chiropractors, dentists, nurses, occupational therapists, optometrists, pharmacists, mental health professionals, psychologists, speech/language pathologists, dieticians, and massage therapists. Yet only physical therapists and massage therapists are subject to an employment restriction. The Court found that the Board had provided no conceivable basis for the disparate treatment, noting that when asked why an occupational therapist would be treated differently than a physical therapist, the Board had no answer.
The Board has 30 days to file an appeal to the Delaware Supreme Court. However, if there is not appeal or if the Delaware Supreme Court affirms the Superior Court’s decision, the prohibition against physicians hiring and working alongside physical therapists and athletic trainers will no longer exist.
