Corp. practice of medicine

AN ACT Relating to the corporate practice of medicine; amending 1
RCW 18.130.180 and 19.100.120; adding a new section to chapter 18.100 2
RCW; adding a new section to chapter 70.41 RCW; adding a new section 3
to chapter 71.12 RCW; adding a new section to chapter 70.230 RCW; 4
adding a new section to chapter 18.51 RCW; adding a new section to 5
chapter 18.46 RCW; adding a new section to chapter 70.127 RCW; adding 6
a new section to chapter 18.71 RCW; adding a new section to chapter 7
18.57 RCW; adding a new section to chapter 18.79 RCW; adding a new 8
section to chapter 18.06 RCW; adding a new section to chapter 18.225 9
RCW; adding a new section to chapter 18.22 RCW; adding a new section 10
to chapter 18.25 RCW; adding a new section to chapter 18.32 RCW; 11
adding a new section to chapter 18.29 RCW; adding a new section to 12
chapter 18.36A RCW; adding a new section to chapter 18.47 RCW; adding 13
a new section to chapter 18.50 RCW; adding a new section to chapter 14
18.53 RCW; adding a new section to chapter 18.55 RCW; adding a new 15
section to chapter 18.59 RCW; adding a new section to chapter 18.64 16
RCW; adding a new section to chapter 18.71A RCW; adding a new section 17
to chapter 18.74 RCW; adding a new section to chapter 18.83 RCW; 18
adding a new section to chapter 18.108 RCW; adding a new section to 19
chapter 18.138 RCW; adding a new section to chapter 18.205 RCW; and 20
adding a new section to chapter 18.290 RCW. 21
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:22
S-0302.2
SENATE BILL 5387
State of Washington 69th Legislature 2025 Regular Session
By Senators Robinson, Hasegawa, Liias, Nobles, Riccelli, Stanford,
and Valdez
Read first time 01/21/25. Referred to Committee on Health & Long-
Term Care.
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NEW SECTION. Sec. 1. A new section is added to chapter 18.100 1
RCW to read as follows: 2
(1) Except as permitted under this chapter and chapter 25.15 RCW, 3
it is unlawful for an individual, corporation, partnership, or any 4
other entity without a license to practice medicine, own a medical 5
practice, employ licensed health care providers, or otherwise engage 6
in the practice of medicine. 7
(2) In a professional service corporation organized under this 8
chapter for the purpose of establishing a medical practice, health 9
care providers licensed in this state must: 10
(a) Hold the majority of each class of shares that are entitled 11
to vote; 12
(b) Be a majority of the directors; and 13
(c) Hold all officer positions in the corporation except for 14
secretary and treasurer. 15
(3) Majority shareholders must exhibit meaningful ownership of a 16
medical practice organized under this chapter by being present in the 17
state and substantially engaged in delivering care and managing the 18
practice. 19
(4) A shareholder, director, or officer of a medical practice 20
organized under this chapter may not: 21
(a) Own or control shares in, serve as a director or officer of, 22
be an employee of or an independent contractor with, or otherwise 23
participate in managing both the medical practice and a management 24
services organization with which the medical practice has a contract;25
(b) Receive substantial compensation or remuneration from a 26
management services organization in return for ownership or 27
management of the medical practice; 28
(c) Transfer or relinquish control over the sale, the restriction 29
of the sale, or the encumbrance of the sale of the medical practice's 30
shares or assets; 31
(d) Transfer or relinquish control over the issuing of shares of 32
stock in the medical practice, a subsidiary of the medical practice, 33
or an entity affiliated with the medical practice, or the paying of 34
dividends; or 35
(e) Enter into any financial arrangement in violation of chapter 36
19.68 RCW. 37
(5)(a) A shareholder, director, or officer of a medical practice 38
organized under this chapter may not relinquish control over or 39
otherwise transfer de facto control over any of the medical 40
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practice's administrative, business, or clinical operations that may 1
affect clinical decision making or the nature or quality of medical 2
care that the medical practice delivers by means of a contract or 3
other agreement or arrangement; by providing in the medical 4
practice's articles of incorporation or bylaws; by forming a 5
subsidiary or affiliated entity; or by other means.6
(b) Conduct prohibited under (a) of this subsection includes, but 7
is not limited to, relinquishing decision making authority over:8
(i) Hiring or terminating, setting work schedules and 9
compensation, or otherwise specifying terms of employment of 10
employees who are licensed to practice medicine in this state;11
(ii) The disbursement of revenue generated from provider fees and 12
other revenue generated by provider services; 13
(iii) Collaboration and negotiation with hospitals and other 14
institutions with which a licensed health care provider employed by 15
the medical practice may deliver clinical care, particularly with 16
regard to controlling a provider's schedules as a means of 17
discipline; 18
(iv) Setting staffing levels, or specifying the period of time a 19
provider may see a patient, for any location that serves patients;20
(v) Making diagnostic coding decisions; 21
(vi) Setting clinical standards or policies; 22
(vii) Setting policies for patient, client, or customer billing 23
and collection; 24
(viii) Setting the prices, rates, or amounts the medical practice 25
charges for a provider's services; or 26
(ix) Negotiating, executing, performing, enforcing, or 27
terminating contracts with third-party payors or persons that are not 28
employees of the medical practice. 29
(6) This section does not apply to hospitals licensed under 30
chapter 70.41 RCW, private establishments licensed under chapter 31
71.12 RCW, nursing homes licensed under chapter 18.51 RCW, ambulatory 32
surgical facilities licensed under chapter 70.230 RCW, birthing 33
centers licensed under chapter 18.46 RCW, hospice care centers 34
licensed under chapter 70.127 RCW, or federally qualified health 35
centers as defined in 42 U.S.C. Sec. 1396d. 36
(7) For the purposes of this section, "management services 37
organization" means any organization or entity that contracts with a 38
professional service corporation to perform management or 39
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administrative services relating to, supporting, or facilitating the 1
provision of health care services. 2
NEW SECTION. Sec. 2. A new section is added to chapter 70.41 3
RCW to read as follows: 4
(1) No person without a license to practice medicine in this 5
state, who is employed by, contracted with, or affiliated with a 6
hospital licensed under this chapter, may interfere with, control, or 7
otherwise direct the professional judgment or clinical decisions of a 8
licensed health care provider employed by, affiliated with, or 9
contracted with the hospital, who is providing care to a patient at 10
the hospital. 11
(2) Conduct prohibited under this section includes, as 12
applicable, but is not limited to, controlling, either directly or 13
indirectly, through policy, discipline, punishment, threats, adverse 14
employment actions, coercion, retaliation, or excessive pressure, any 15
of the following: 16
(a) The period of time a provider may spend with a patient, 17
including the time permitted for a health care provider to triage 18
patients in the emergency department or evaluate admitted patients;19
(b) The period of time within which a health care provider must 20
discharge a patient; 21
(c) The clinical status of the patient, including whether the 22
patient should be admitted to inpatient status, whether the patient 23
should be kept in observation status, whether the patient should 24
receive palliative care, and whether and where the patient should be 25
referred upon discharge, such as a skilled nursing facility;26
(d) The diagnoses, diagnostic terminology, or codes that are 27
entered into the medical record by the health care provider;28
(e) The range of clinical orders available to a health care 29
provider, including by configuring the medical record to prohibit or 30
significantly limit the options available to the provider; or31
(f) Any other action specified by rule to constitute 32
impermissible interference or control over the clinical judgment and 33
decision making of a health care provider related to the diagnosis 34
and treatment of a patient. 35
NEW SECTION. Sec. 3. A new section is added to chapter 71.12 36
RCW to read as follows: 37
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(1) No person without a license to practice medicine in this 1
state, who is employed by, contracted with, or affiliated with a 2
private establishment licensed under this chapter, may interfere 3
with, control, or otherwise direct the professional judgment or 4
clinical decision making of a licensed health care provider employed 5
by, affiliated with, or contracted with the private establishment, 6
who is providing care to a patient at the private establishment.7
(2) Conduct prohibited under this section includes, as 8
applicable, but is not limited to, controlling, either directly or 9
indirectly, through policy, discipline, punishment, threats, adverse 10
employment actions, coercion, retaliation, or excessive pressure, any 11
of the following: 12
(a) The period of time a provider may spend with a patient, 13
including the time permitted for a health care provider to triage 14
patients in the emergency department or evaluate admitted patients;15
(b) The period of time within which a health care provider must 16
discharge a patient; 17
(c) The clinical status of the patient, including whether the 18
patient should be admitted to inpatient status, whether the patient 19
should be kept in observation status, whether the patient should 20
receive palliative care, and whether and where the patient should be 21
referred upon discharge; 22
(d) The diagnoses, diagnostic terminology, or codes that are 23
entered into the medical record by the health care provider;24
(e) The range of clinical orders available to a health care 25
provider, including by configuring the medical record to prohibit or 26
significantly limit the options available to the provider; or27
(f) Any other action specified by rule to constitute 28
impermissible interference or control over the clinical judgment and 29
decision making of a health care provider related to the diagnosis 30
and treatment of a patient. 31
NEW SECTION. Sec. 4. A new section is added to chapter 70.230 32
RCW to read as follows: 33
(1) No person without a license to practice medicine in this 34
state, who is employed by, contracted with, or affiliated with an 35
ambulatory surgical facility licensed under this chapter, may 36
interfere with, control, or otherwise direct the professional 37
judgment or clinical decision making of a licensed health care 38
provider employed by, affiliated with, or contracted with the 39
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ambulatory surgical facility, who is providing care to a patient at 1
the ambulatory surgical facility. 2
(2) Conduct prohibited under this section includes, as 3
applicable, but is not limited to, controlling, either directly or 4
indirectly, through policy, discipline, punishment, threats, adverse 5
employment actions, coercion, retaliation, or excessive pressure, any 6
of the following: 7
(a) The period of time a provider may spend with a patient;8
(b) The period of time within which a health care provider must 9
discharge a patient; 10
(c) The clinical status of the patient; 11
(d) The diagnoses, diagnostic terminology, or codes that are 12
entered into the medical record by the health care provider;13
(e) The range of clinical orders available to a health care 14
provider, including by configuring the medical record to prohibit or 15
significantly limit the options available to the provider; or16
(f) Any other action specified by rule to constitute 17
impermissible interference or control over the clinical judgment and 18
decision making of a health care provider related to the diagnosis 19
and treatment of a patient. 20
NEW SECTION. Sec. 5. A new section is added to chapter 18.51 21
RCW to read as follows: 22
(1) No person without a license to practice medicine in this 23
state, who is employed by, contracted with, or affiliated with a 24
nursing home licensed under this chapter, may interfere with, 25
control, or otherwise direct the professional judgment or clinical 26
decisions of a licensed health care provider employed by, affiliated 27
with, or contracted with the nursing home, who is providing care to 28
residents of the nursing home. 29
(2) Conduct prohibited under this section includes, but is not 30
limited to, controlling or attempting to control decision making 31
concerning the practice of medicine or the diagnosis and treatment of 32
any patient, either directly or indirectly, through policy, 33
discipline, punishment, threats, adverse employment actions, 34
coercion, retaliation, or excessive pressure of any kind.35
NEW SECTION. Sec. 6. A new section is added to chapter 18.46 36
RCW to read as follows: 37
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(1) No person without a license to practice medicine in this 1
state, who is employed by, contracted with, or affiliated with a 2
birthing center licensed under this chapter, may interfere with, 3
control, or otherwise direct the professional judgment or clinical 4
decisions of a licensed health care provider employed by, affiliated 5
with, or contracted with the birthing center, who is providing care 6
to a patient in the birthing center. 7
(2) Conduct prohibited under this section includes, but is not 8
limited to, controlling or attempting to control decision making 9
concerning the practice of medicine or the diagnosis and treatment of 10
any patient, either directly or indirectly, through policy, 11
discipline, punishment, threats, adverse employment actions, 12
coercion, retaliation, or excessive pressure of any kind.13
NEW SECTION. Sec. 7. A new section is added to chapter 70.127 14
RCW to read as follows: 15
(1) No person without a license to practice medicine in this 16
state, who is employed by, contracted with, or affiliated with a 17
hospice agency licensed under this chapter, may interfere with, 18
control, or otherwise direct the professional judgment or clinical 19
decisions of a licensed health care provider employed by, affiliated 20
with, or contracted with the hospice care agency, who is providing 21
care to an individual in a hospice care center operated by the 22
hospice agency. 23
(2) Conduct prohibited under this section includes, but is not 24
limited to, controlling or attempting to control decision making 25
concerning the practice of medicine or the diagnosis and treatment of 26
any patient, either directly or indirectly, through policy, 27
discipline, punishment, threats, adverse employment actions, 28
coercion, retaliation, or excessive pressure of any kind.29
Sec. 8. RCW 18.130.180 and 2024 c 220 s 2 are each amended to 30
read as follows: 31
Except as provided in RCW 18.130.450, the following conduct, 32
acts, or conditions constitute unprofessional conduct for any license 33
holder under the jurisdiction of this chapter: 34
(1) The commission of any act involving moral turpitude, 35
dishonesty, or corruption relating to the practice of the person's 36
profession, whether the act constitutes a crime or not. If the act 37
constitutes a crime, conviction in a criminal proceeding is not a 38
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condition precedent to disciplinary action. Upon such a conviction, 1
however, the judgment and sentence is conclusive evidence at the 2
ensuing disciplinary hearing of the guilt of the license holder of 3
the crime described in the indictment or information, and of the 4
person's violation of the statute on which it is based. For the 5
purposes of this section, conviction includes all instances in which 6
a plea of guilty or nolo contendere is the basis for the conviction 7
and all proceedings in which the sentence has been deferred or 8
suspended. Nothing in this section abrogates rights guaranteed under 9
chapter 9.96A RCW; 10
(2) Misrepresentation or concealment of a material fact in 11
obtaining a license or in reinstatement thereof; 12
(3) All advertising which is false, fraudulent, or misleading;13
(4) Incompetence, negligence, or malpractice which results in 14
injury to a patient or which creates an unreasonable risk that a 15
patient may be harmed. The use of a nontraditional treatment by 16
itself shall not constitute unprofessional conduct, provided that it 17
does not result in injury to a patient or create an unreasonable risk 18
that a patient may be harmed; 19
(5) Suspension, revocation, or restriction of the individual's 20
license to practice any health care profession by competent authority 21
in any state, federal, or foreign jurisdiction, a certified copy of 22
the order, stipulation, or agreement being conclusive evidence of the 23
revocation, suspension, or restriction; 24
(6) The possession, use, prescription for use, or distribution of 25
controlled substances or legend drugs in any way other than for 26
legitimate or therapeutic purposes, diversion of controlled 27
substances or legend drugs, the violation of any drug law, or 28
prescribing controlled substances for oneself; 29
(7) Violation of any state or federal statute or administrative 30
rule regulating the profession in question, including any statute or 31
rule defining or establishing standards of patient care or 32
professional conduct or practice; 33
(8) Failure to cooperate with the disciplining authority by:34
(a) Not furnishing any papers, documents, records, or other 35
items; 36
(b) Not furnishing in writing a full and complete explanation 37
covering the matter contained in the complaint filed with the 38
disciplining authority; 39
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(c) Not responding to subpoenas issued by the disciplining 1
authority, whether or not the recipient of the subpoena is the 2
accused in the proceeding; or 3
(d) Not providing reasonable and timely access for authorized 4
representatives of the disciplining authority seeking to perform 5
practice reviews at facilities utilized by the license holder;6
(9) Failure to comply with an order issued by the disciplining 7
authority or a stipulation for informal disposition entered into with 8
the disciplining authority; 9
(10) Aiding or abetting an unlicensed person to practice when a 10
license is required; 11
(11) Violations of rules established by any health agency;12
(12) Practice beyond the scope of practice as defined by law or 13
rule; 14
(13) Misrepresentation or fraud in any aspect of the conduct of 15
the business or profession; 16
(14) Failure to adequately supervise auxiliary staff to the 17
extent that the consumer's health or safety is at risk;18
(15) Engaging in a profession involving contact with the public 19
while suffering from a contagious or infectious disease involving 20
serious risk to public health; 21
(16) Promotion for personal gain of any unnecessary or 22
inefficacious drug, device, treatment, procedure, or service;23
(17) Conviction of any gross misdemeanor or felony relating to 24
the practice of the person's profession. For the purposes of this 25
subsection, conviction includes all instances in which a plea of 26
guilty or nolo contendere is the basis for conviction and all 27
proceedings in which the sentence has been deferred or suspended. 28
Nothing in this section abrogates rights guaranteed under chapter 29
9.96A RCW; 30
(18) The offering, undertaking, or agreeing to cure or treat 31
disease by a secret method, procedure, treatment, or medicine, or the 32
treating, operating, or prescribing for any health condition by a 33
method, means, or procedure which the licensee refuses to divulge 34
upon demand of the disciplining authority; 35
(19) The willful betrayal of a practitioner-patient privilege as 36
recognized by law; 37
(20) Violation of chapter 19.68 RCW or a pattern of violations of 38
RCW 41.05.700(8), 48.43.735(8), 48.49.020, 48.49.030, 71.24.335(8), 39
or 74.09.325(8); 40
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(21) Interference with an investigation or disciplinary 1
proceeding by willful misrepresentation of facts before the 2
disciplining authority or its authorized representative, or by the 3
use of threats or harassment against any patient or witness to 4
prevent them from providing evidence in a disciplinary proceeding or 5
any other legal action, or by the use of financial inducements to any 6
patient or witness to prevent or attempt to prevent him or her from 7
providing evidence in a disciplinary proceeding; 8
(22) Current misuse of: 9
(a) Alcohol; 10
(b) Controlled substances; or 11
(c) Legend drugs; 12
(23) Abuse of a client or patient or sexual contact with a client 13
or patient; 14
(24) Acceptance of more than a nominal gratuity, hospitality, or 15
subsidy offered by a representative or vendor of medical or health-16
related products or services intended for patients, in contemplation 17
of a sale or for use in research publishable in professional 18
journals, where a conflict of interest is presented, as defined by 19
rules of the disciplining authority, in consultation with the 20
department, based on recognized professional ethical standards;21
(25) Violation of RCW 18.130.420; 22
(26) Performing conversion therapy on a patient under age 23
eighteen; 24
(27) Violation of any provision of sections 1 through 7 of this 25
act;26
(28) Violation of RCW 18.130.430; 27
(((28))) (29) Violation of RCW 18.130.460; or 28
(((29))) (30) Implanting the license holder's own gametes or 29
reproductive material into a patient. 30
NEW SECTION. Sec. 9. A new section is added to chapter 18.71 31
RCW to read as follows: 32
Upon application for a license or license renewal, an applicant 33
must attest, in a form and manner determined by the commission, that 34
they are aware of regulations related to the corporate practice of 35
medicine included in sections 1 through 7 of this act.36
NEW SECTION. Sec. 10. A new section is added to chapter 18.57 37
RCW to read as follows: 38
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Upon application for a license or license renewal, an applicant 1
must attest, in a form and manner determined by the board, that they 2
are aware of regulations related to the corporate practice of 3
medicine included in sections 1 through 7 of this act.4
NEW SECTION. Sec. 11. A new section is added to chapter 18.79 5
RCW to read as follows: 6
Upon application for a license or license renewal, an applicant 7
for a registered nurse, advanced practice registered nurse, or 8
licensed practical nurse license must attest, in a form and manner 9
determined by the board, that they are aware of regulations related 10
to the corporate practice of medicine included in sections 1 through 11
7 of this act. 12
NEW SECTION. Sec. 12. A new section is added to chapter 18.06 13
RCW to read as follows: 14
Upon application for a license or license renewal, an applicant 15
must attest, in a form and manner determined by the secretary, that 16
they are aware of regulations related to the corporate practice of 17
medicine included in sections 1 through 7 of this act.18
NEW SECTION. Sec. 13. A new section is added to chapter 18.225 19
RCW to read as follows: 20
Upon application for a license or license renewal, an applicant 21
must attest, in a form and manner determined by the secretary, that 22
they are aware of regulations related to the corporate practice of 23
medicine included in sections 1 through 7 of this act.24
NEW SECTION. Sec. 14. A new section is added to chapter 18.22 25
RCW to read as follows: 26
Upon application for a license or license renewal, an applicant 27
must attest, in a form and manner determined by the board, that they 28
are aware of regulations related to the corporate practice of 29
medicine included in sections 1 through 7 of this act.30
NEW SECTION. Sec. 15. A new section is added to chapter 18.25 31
RCW to read as follows: 32
Upon application for a license or license renewal, an applicant 33
must attest, in a form and manner determined by the commission, that 34
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they are aware of regulations related to the corporate practice of 1
medicine included in sections 1 through 7 of this act.2
NEW SECTION. Sec. 16. A new section is added to chapter 18.32 3
RCW to read as follows: 4
Upon application for a license or license renewal, an applicant 5
must attest, in a form and manner determined by the commission, that 6
they are aware of regulations related to the corporate practice of 7
medicine included in sections 1 through 7 of this act.8
NEW SECTION. Sec. 17. A new section is added to chapter 18.29 9
RCW to read as follows: 10
Upon application for a license or license renewal, an applicant 11
must attest, in a form and manner determined by the secretary, that 12
they are aware of regulations related to the corporate practice of 13
medicine included in sections 1 through 7 of this act.14
NEW SECTION. Sec. 18. A new section is added to chapter 18.36A 15
RCW to read as follows: 16
Upon application for a license or license renewal, an applicant 17
must attest, in a form and manner determined by the board, that they 18
are aware of regulations related to the corporate practice of 19
medicine included in sections 1 through 7 of this act.20
NEW SECTION. Sec. 19. A new section is added to chapter 18.47 21
RCW to read as follows: 22
Upon application for certification or certification renewal, an 23
applicant must attest, in a form and manner determined by the 24
secretary, that they are aware of regulations related to the 25
corporate practice of medicine included in sections 1 through 7 of 26
this act. 27
NEW SECTION. Sec. 20. A new section is added to chapter 18.50 28
RCW to read as follows: 29
Upon application for a license or license renewal, an applicant 30
must attest, in a form and manner determined by the secretary, that 31
they are aware of regulations related to the corporate practice of 32
medicine included in sections 1 through 7 of this act.33
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NEW SECTION. Sec. 21. A new section is added to chapter 18.53 1
RCW to read as follows: 2
Upon application for a license or license renewal, an applicant 3
must attest, in a form and manner determined by the board, that they 4
are aware of regulations related to the corporate practice of 5
medicine included in sections 1 through 7 of this act.6
NEW SECTION. Sec. 22. A new section is added to chapter 18.55 7
RCW to read as follows: 8
Upon application for a license or license renewal, an applicant 9
must attest, in a form and manner determined by the secretary, that 10
they are aware of regulations related to the corporate practice of 11
medicine included in sections 1 through 7 of this act.12
NEW SECTION. Sec. 23. A new section is added to chapter 18.59 13
RCW to read as follows: 14
Upon application for a license or license renewal, an applicant 15
must attest, in a form and manner determined by the board, that they 16
are aware of regulations related to the corporate practice of 17
medicine included in sections 1 through 7 of this act.18
NEW SECTION. Sec. 24. A new section is added to chapter 18.64 19
RCW to read as follows: 20
Upon application for a license or license renewal, an applicant 21
must attest, in a form and manner determined by the commission, that 22
they are aware of regulations related to the corporate practice of 23
medicine included in sections 1 through 7 of this act.24
NEW SECTION. Sec. 25. A new section is added to chapter 18.71A 25
RCW to read as follows: 26
Upon application for a license or license renewal, an applicant 27
must attest, in a form and manner determined by the commission, that 28
they are aware of regulations related to the corporate practice of 29
medicine included in sections 1 through 7 of this act.30
NEW SECTION. Sec. 26. A new section is added to chapter 18.74 31
RCW to read as follows: 32
Upon application for a license or license renewal, an applicant 33
must attest, in a form and manner determined by the board, that they 34
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are aware of regulations related to the corporate practice of 1
medicine included in sections 1 through 7 of this act.2
NEW SECTION. Sec. 27. A new section is added to chapter 18.83 3
RCW to read as follows: 4
Upon application for a license or license renewal, an applicant 5
must attest, in a form and manner determined by the board, that they 6
are aware of regulations related to the corporate practice of 7
medicine included in sections 1 through 7 of this act.8
NEW SECTION. Sec. 28. A new section is added to chapter 18.108 9
RCW to read as follows: 10
Upon application for a license or license renewal, an applicant 11
must attest, in a form and manner determined by the board, that they 12
are aware of regulations related to the corporate practice of 13
medicine included in sections 1 through 7 of this act.14
NEW SECTION. Sec. 29. A new section is added to chapter 18.138 15
RCW to read as follows: 16
Upon application for certification or certification renewal, an 17
applicant must attest, in a form and manner determined by the 18
secretary, that they are aware of regulations related to the 19
corporate practice of medicine included in sections 1 through 7 of 20
this act. 21
NEW SECTION. Sec. 30. A new section is added to chapter 18.205 22
RCW to read as follows: 23
Upon application for certification or certification renewal, an 24
applicant must attest, in a form and manner determined by the 25
secretary, that they are aware of regulations related to the 26
corporate practice of medicine included in sections 1 through 7 of 27
this act. 28
NEW SECTION. Sec. 31. A new section is added to chapter 18.290 29
RCW to read as follows: 30
Upon application for a license or license renewal, an applicant 31
must attest, in a form and manner determined by the secretary, that 32
they are aware of regulations related to the corporate practice of 33
medicine included in sections 1 through 7 of this act.34
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Sec. 32. RCW 19.100.120 and 2011 c 336 s 559 are each amended to 1
read as follows: 2
The director may issue a stop order denying effectiveness to or 3
suspending or revoking the effectiveness of any registration 4
statement if he or she finds that the order is in the public interest 5
and that: 6
(1) The registration statement as of its effective date, or as of 7
any earlier date in the case of an order denying effectiveness, is 8
incomplete in any material respect or contains any statement which 9
was in the light of the circumstances under which it was made false 10
or misleading with respect to any material fact; 11
(2) Any provision of this chapter or any rule or order or 12
condition lawfully imposed under this chapter has been violated in 13
connection with the offering by: 14
(a) The person filing the registration statement but only if such 15
person is directly or indirectly controlled by or acting for the 16
franchisor; or 17
(b) The franchisor, any partner, officer, or director of a 18
franchisor, or any person occupying a similar status or performing 19
similar functions or any person directly or indirectly controlling or 20
controlled by the franchisor. 21
(3) The franchise offering registered or sought to be registered 22
is the subject of a permanent or temporary injunction of any court of 23
competent jurisdiction entered under any federal or state act 24
applicable to the offering but the director may not:25
(a) Institute a proceeding against an effective registration 26
statement under this clause more than one year from the date of the 27
injunctive relief thereon unless the injunction is thereafter 28
violated; and 29
(b) Enter an order under this clause on the basis of an 30
injunction entered under any other state act unless that order or 31
injunction is based on facts that currently constitute a ground for 32
stop order under this section; 33
(4) A franchisor's enterprise or method of business includes or 34
would include activities which are illegal where performed , including 35
but not limited to violations of section 1 of this act;36
(5) The offering has worked or tended to work a fraud upon 37
purchasers or would so operate; 38
(6) The applicant has failed to comply with any rule or order of 39
the director issued pursuant to RCW 19.100.050. 40
p. 15 SB 5387
(7) The applicant or registrant has failed to pay the proper 1
registration fee but the director may enter only a denial order under 2
this subsection and he or she shall vacate such order when the 3
deficiency has been corrected. 4
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p. 16 SB 5387