American Academy of Nurse Entrepreneurs

Collaborating Physician Part 1: Requirements and Risks

Let’s talk collaborating physicians.

If you live in a non-Full Practice Authority (FPA) state, you’re required to have a relationship with a physician to practice to the full extent of your training. Ultimately, it is our communities that suffer because it means healthcare, once again, is less accessible. However, for 22 states, this is a regulation that APRNs must navigate if they want to be entrepreneurial and be of service. 

State Practice Map

Finding and working with a collaborating physician presents a big obstacle for Nurse Owners in non-FPA states. With that said, I’m an NP who has owned my own practice in one of the more restrictive states (Texas) for the last 7 years. I’m here to tell you the obstacle  is not insurmountable! It is one puzzle to solve, in a long list of puzzles you’ll face as an entrepreneur. That’s OK because Nurse Owners view life as an adventure consisting of puzzles to be solved, battles to be fought, and problems to be overcome (H/T Roy H. Williams). 

In order to have a meaningful conversation about collaborative physician compensation, we must first understand the requirements of the collaborative relationship (i.e. the work required), as well as inherent risks involved with the relationship.

Requirements of the Relationship

While specific collaboration requirements vary by state, they may contain some or all of the components described below. For detailed information about the regulations in your state, please refer to your State Nursing Practice Act, or check out our State-Specific Quick Start Guides, available here.

Collaborative Practice Agreement

In many states, like Texas, California, Tennessee and Indiana, APRNs are required to have a collaborative practice agreement with a physician. The name of this agreement can vary. In Texas, it’s called a Prescriptive Authority Agreement (PAA). 

This collaborative practice agreement is basically a contract between an APRN and a physician. The agreement sets forth the rights and responsibilities of each party. The exact requirements of these agreements vary by state, but in general they specify activities that fall within that APRN’s scope of practice and include types of services that can be rendered, such as:

  • H&Ps
  • Types of medical conditions that can be treated, with or without physician consultation
  • Whether or not a procedure requires direct or indirect supervision
  • Ordering, performing, and interpreting lab tests
  • Ordering and interpreting ancillary studies, such as x-rays or EKGs
  • Prescribing and managing medications
  • Performing specific procedures, such as lumbar punctures. 

Again, you can find templates for your state’s specific requirements in our State-Specific Quick Start Guides. If you have any questions, feel free to ask us anything by sending an email to and we’ll help you out.

Chart Review

In addition to a collaborative practice agreement, there is often a requirement for chart review. This means the physician is required to review a certain percentage of an APRN’s charts and/or prescribing practices. In Indiana, for example, the collaborative physician is required to review “at least a five percent (5%) random sampling of the charts and medications prescribed for patients”. There is a big range state by state of chart review requirements. Georgia is as high as 100%. Planning ahead, creating a model that meets the requirements, and having a clear agreement with your collaborating physician is paramount for building a scalable business. 

Routine Meeting

There may be a requirement for routine meetings between the APRN and Physician Collaborator. As an example, North Carolina requires monthly meetings (which may take place via telecommunications) during the first 6 months of the relationship, and allows for bi-annual meetings thereafter.  In Texas, monthly meetings are required to cover information related to patient treatment and care, needed changes in patient care plans, issues related to referrals, and discussion of patient care improvement. Once again (sorry to sound like a broken record), you need to know the parameters and requirements of your state. Some states require all meetings with your collaborating physician to be in person. These details will dictate how you create your business model.

On-Site Requirement

Some states require that the collaborating physician observe the APRN “on-site” at a routine interval. Georgia statute dictates this must happen at least quarterly, while Tennessee states the CP “…shall be required to visit any remote site at least once every 30 days” (Tenn. Comp. R. & Regs. 0880-6-.02). Both States explicitly state that these on-site visits can NOT be accomplished via telecommunication.

Beyond following state regulations and educating your CP, you need to have a solid understanding of what work is required in order to determine appropriate compensation. As an example, if you practice in Texas where there is no requirement for on-site visits by your CP; CP duties can likely be accomplished in a couple of hours per month. In a state like Georgia or Tennessee, however, where on-site visits ARE required, you’ll likely need to pay more to compensate for the increased time and effort.

Liability Risk

There is risk involved in any job. Similar to skill, risk increases the necessary compensation. That’s why the guys on The Deadliest Catch make the equivalent of an annual salary in just a few weeks a year–because the work they do is risky!

All clinicians are at risk for being sued for malpractice. It’s part of the job, and that’s why you carry malpractice insurance. So it’s no surprise that if an NP is sued, the physician associated  [through collaboration] is at risk for being sued as well. But what exactly is that risk?

There is a common misconception among both APRNs and especially physicians, that physicians are liable for every patient their collaborating nurse practitioner sees.

Is this true?

To answer this question, we need to evaluate malpractice claims, insurance premiums, case law, and state statutes.

Malpractice Claims

Malpractice claims for nurse practitioners are a very small percentage of overall malpractice reports. A 2016 study found that NP’s were responsible for only 2.2% of malpractice reports. This is in comparison to physicians who are responsible for 94.8% of malpractice reports. By the numbers, a situation in which a CP finds himself vicariously liable for the errors of a nurse practitioner is rare.

Insurance Premiums

Insurance premiums for nurse practitioners are very low when compared with Physicians premium. This indicates that insurers (the experts of risk management!) view NP’s as relatively low-risk. 

Malpractice premiums for nurse practitioners have naturally increased in recent years, as they grow in number and practice with more autonomy. Malpractice claims against APRNs still represent only a small fraction of overall claims.

In fact, a 2009 study showed that the inclusion of advanced practice providers does not increase liability and that, in fact, the presence of APRNs in groups may actually decrease exposure to malpractice claims for the group.

Case Law

This is a tricky topic, because it is difficult to research malpractice cases naming nurse practitioners and their collaborating physician. The clinician relationships are often not known, and the details of the trial are not publicly disseminated. 

However, Carolyn Buppert (NP and JD) was able to review 6 cases in which the nurse practitioner and collaborating physician were named in the lawsuits in which the physician was found liable. She found two patterns: 

  1. The physician was directly involved in the care of the patient.
  2. The physician did not uphold the minimum regulations of collaboration set forth by the State.  

Of note, there were ZERO cases in which a physician who was not directly involved in the patient’s care or who was meeting the minimum requirements for collaboration was found liable.

A statute is basically another term for law. In some states (e.g. Illinois and Virginia) CP liability (or lack thereof) is explicitly stated in the regulations. As an example, Virginia law declares – 

Service on a patient care team by a patient care team member shall not, by the existence of such service alone, establish or create liability for the actions or inactions of other team members. Va. Code. Ann. §54.1-2957(C).“  

On the opposite end of the spectrum, statutes in Oklahoma find the CP liable for the APRN’s prescribing practice – 

“Supervision of an Advanced Practice Registered Nurse with prescriptive authority” means overseeing and accepting responsibility for the ordering and transmission by a Certified Nurse Practitioner, a Clinical Nurse Specialist, or a Certified Nurse-Midwife of written, telephonic, electronic or oral prescriptions for drugs and other medical supplies, subject to a defined formulary. Okla Stat. Ann. tit. 59, § 567.3a(12).”

Most states fall in between the two outlined above, in which there are no relevant statutes on the books. In those cases, CP’s should take care to follow all of the state’s supervision requirements, only enter into agreements with qualified NPs, and ensure the NP is able to reach the physician or an associate as needed for consultation.

Knowledge Equals Power

The bottom line is this – before negotiating compensation with your CP, it’s imperative to educate yourself on the statutory requirements and liability risk of CP’s in your state.  Just as you were not educated on the collaborative relationship in nursing school, physicians were not educated on the collaborative relationship in medical school. So, can you really blame them for being hesitant? I can’t. 

Now that you understand the statutory requirements and liability risk of collaboration, let’s talk compensation!

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