Q:What are unique issues in health care office leases?
A: Health care leases present unique issues for landlords and tenants to address during lease negotiations. The specialized nature of health care (whether medical, dental, or any other specialty) requires careful consideration beyond what most standard lease forms provide.
For example, every health care lease should clearly address the issue of not just hazardous materials in general, but should also address the issue of medical waste specifically. Responsibility for the storage, handling, and removal of medical waste, if not clearly delineated, can lead to disagreements and unforeseen liability.
Similarly, the lease should also address how confidential patient information is handled, stored, and destroyed or removed at the end of the lease term. For instance, what happens if a health care provider vacates the space and leaves behind files containing personal health records? Does the lease adequately address this situation?
Issues can also stem from federal laws, particularly the Stark Law and Anti-Kickback Statute. The regulations are extremely complex but generally designed to prevent health care providers from making prohibited referrals in exchange for an unpermitted benefit. These laws include certain restrictions on office sharing and subleasing. As such, a well intentioned real estate deal can run afoul of these laws with severe consequences if not considered in the drafting process.
Joe Romberg an attorney at the law firm of Lukins & Annis, where his practice includes Business & Corporate, Real Estate, Commercial Leasing, urchase & Sale of Real Property and Health Care.
Published in the May 11, 2017 issue of the Spokane Journal of Business.