International Society of Primerus Law Firms

Potential Physician Liability: Distinguishing Medical Services from Products

By: Jonathan R. Ehtessabian

Neil, Dymott, Frank, McFall & Trexler APLC

San Diego, CA

Law has long established physicians cannot be held liable on a products liability theory for a defective product that was used on a patient during a course of treatment. Silverhart v. Mount Zion Hospital (1971) 20 Cal.App.3d 1028. A doctors business is to provide medical services. Thus, courts have reasoned doctors are consumers of the products they employ in conjunction with medical services, and not suppliers of those products. Pierson v. Sharp Memorial Hospital (1989) 216 Cal.App.3d 346.

In todays practice, physicians and medical groups often recommend certain products over others. Many practices make products available to patients for sale or rental directly from their offices. Physicians should be aware of potential liability issues this may create.

First, products sold and/or rented for profit should be directly related to the medical services provided to patients. Skin cream sold by a dermatologist pursuant to a course of treatment, or a knee brace sold by a sports medicine practice following surgery are examples of items that would exempt the physician from a defective product liability lawsuit. Courts have distinguished, on the other hand, hospital gift shops or medical practices that sell items which are not specifically recommended to supplement a patients course of treatment. Hector v. Cedars Sinai Medical Center (1986) 180 Cal. App. 3rd 493. In situations where health-related products are made available for sale to a general clientele, the medical practice is construed no differently from any other commercial supplier. Id.

Additionally, when a medical office does offer products for sale or rental, there may be requirements to disclose financial interests. The American Medical Associations Code of Medical Ethics, Opinion 8.063, concerning the sale of health-related products, requires physicians to fully disclose the nature of their financial arrangement with a manufacturer or supplier before selling health-related products.

Health-related products are defined, broadly, as any product that, according to the manufacturer or distributor, benefits health. Selling incorporates not only dispensing the item from the physicians office, but also the activity of endorsing a product the patient may purchase elsewhere that results in direct remuneration for the physician.

Opinion 8.063 is primarily concerned with products that are not scientifically validated. Physicians who choose to sell health-related products from their offices should rely on peer-reviewed literature and other un-biased sources that review evidence in a reliable fashion.

Notably, Opinion 8.063 specifically exempts prescription products. Under Opinion 8.06, physicians who prescribe products to facilitate treatment are prohibited from accepting direct compensation from a product manufacturer and should not be influenced by other indirect financial interests. However, they are permitted to sell prescription products free of the disclosure requirements laid out in Opinion 8.063.

While, selling health-related products out of the office provides benefits such as convenience to patients and ancillary income for the practice, it is the physicians responsibility to ensure patients are receiving appropriate disclosure and the products offered are related to individualized medical services.

For more info on Neil Dymott, visit the International Society of Primerus Law Firms or neildymott.com.

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