Lease Arrangements

655.(a) for the purpose of this chapter, an “optical company” is any person or entity who is engaged in the manufacture, sale, or distribution to physicians and surgeons, optometrists, or dispensing opticians of lenses, frames, optical supplies, optometric appliances or devices or kindred products. (b) No person licensed under Chapter 5.5 (commencing with Section 2550) of this division (which may be referred to below as a registered dispensing optician) or any optical company shall own or have an ownership interest in any health care service plan licensed pursuant to Section 1340 of the Health & Safety Code (“Vision Care Plan”) if the Vision Care Plan directly employs persons licensed under Chapter 7 (commencing with Section 3000) of this division (who may be referred to herein as an “optometrist”) to provide professional vision care services to the Vision Care Plan’s enrollees. (c) No optometrist may have any membership, proprietary interest, coownership, or any profit-sharing arrangement, with any registered dispensing optician, either by stock ownership, interlocking directors, trusteeship, mortgage, or trust deed, except as otherwise permitted under this Section 655. (d) Notwithstanding anything to the contrary in this Section 655, a registered dispensing optician, an optical company, or an optometrist, can, except as prohibited in 655(b), operate, own or have an ownership interest in a Vision Care Plan, and can directly or indirectly provide products and services to the Vision Care Plan or its contracted providers or enrollees, so long as the registered dispensing optician or optical company does not interfere with the professional judgment of the optometrist. The optical company’s, optometrist’s, registered dispensing optician’s or Vision Care Plan’s participation in the arrangements described in this subsection 655(d) shall not be considered or constitute a prohibited relationship under, or violation of, any provision of Section 655. (e) An optometrist may have a direct or indirect landlord-tenant relationship with a registered dispensing optician or an optical company or a Vision Care Plan, if all of the following conditions are contained in a written agreement establishing the landlord-tenant relationship: (1) The practice shall be owned by the optometrist and in every phase be under the optometrist’s exclusive control, including the selection and supervision of optometric staff, the scheduling of patients, the amount of time the optometrist spends with patients, the examination procedures and treatment provided to patients and the optometrist’s contracting with managed care organizations. (2) The patient records shall be the sole property of the optometrist. Only the optometrist and those persons who the optometrist authorizes, in writing, shall have access to the patient records and the examination room, except as otherwise provided by law. The optometrist shall make every effort to provide for emergency referrals. (3) The optometrist’s rented space shall be definite and distinct from space occupied by other occupants of the premises, have a sign designating that the rented space is occupied by an independent optometrist or optometrists and be accessible to the optometrist after hours or in the case of an emergency, subject to the facility’s general accessibility. (4) All signs, advertising, and displays shall be separate and distinct from that of the other occupants and have the optometrist's name and the word “optometrist” prominently displayed in connection therewith, except as otherwise permitted in subsection 655(e)(7). This subsection 655(e)(4) shall not prohibit optometrists or registered dispensing opticians, individually or jointly, from advertising their practice locations in the leased premises, their participation in any Vision Care Plan’s network or the Vision Care Plan’s products in which they participate. (5) There shall be no signs displayed on any part of the premises or in any advertising indicating that the optometrist is employed or controlled by the registered dispending optician or optical company. (6) Except for a statement that an independent doctor of optometry is located on the premises, in-store pricing signs and as permitted by subsections 655(e)(4), 655(e)(7) and 655(e)(8), neither the registered dispensing optician nor the optical company that leases space to an optometrist shall link the optometrist's name, practice, or fees in advertising with that of the registered dispensing optician or optical company landlord. (7) Subsections 655(e)(4) through 655(e)(6) shall not preclude a Vision Care Plan from advertising its health plan products and their associated costs and the names and locations of the Vision Care Plan’s providers, including any optometrists and registered opticians providers that provide professional services in co-located offices, in compliance with the Knox Keene Health Care Service Plan Act. (8) A Vision Care Plan that advertises its products and services in accordance with subsection 655(e)(7)shall not advertise the optometrist’s fees for products and services that are not included in the Vision Care Plan’s products and services. (9) The optometrist shall not be precluded from collecting fees for services that are not included in the Vision Care Plan’s products and services, subject to any disclosure requirements to the patients, contained in Vision Care Plan’s provider agreement with the optometrist. (10) The term of the lease shall be no less than one year and shall not require the optometrist to contract exclusively with a Vision Care Plan. The optometrist may terminate the lease according to the terms of the lease. The registered dispensing optician, optical company or Vision Care Plan may terminate the lease for reasons such as: (A) Non-payment of rent. (B) Impairment, suspension or revocation of the optometrist’s license or if the optometrist or the optometrist’s employee is or becomes ineligible to participate in state or federal government-funded programs. (C) The death or incapacitation of the optometrist. (D) Events of Force Majeure. (E) Intentional or negligent acts that result in damage to the landlord’s real or personal property or its value. (F) Criminal acts occurring on the premises, or acts occurring on the premises that could pose a health or safety risk to the other occupants or invitees of the premises. (G) Noncompliance with any laws, codes, policies or regulations of any government body applicable to the optometrist’s practice or leasing of the premises. (H) Vacating, abandoning or surrendering the premises. (I) Termination of any underlying lease where the optometrist has subleased space, or the optometrist’s failure to comply with the underlying lease provisions that are made applicable to the optometrist. (J) Conduct that is unprofessional, including substance abuse, or that is materially detrimental to the landlord’s business or goodwill. (K) The breach of any other material term of the lease, which the optometrist fails to cure in a timely manner after appropriate notice is given, in accordance with the lease terms. (L) The termination of the provider agreement between the Vision Care Plan and the optometrist as authorized under the Knox Keene Health Care Service Plan Act, where the Vision Care Plan is the landlord. (11) The landlord shall act in good faith in terminating the lease and in no case shall the landlord terminate the lease for reasons that constitute interference with the practice of optometry. (12) Lease or rent terms and payments shall not be based on number of eye exams performed, prescriptions written, patient referrals or the sale or promotion of the products of a registered dispensing optician or an optical company. (13) The California Board of Optometry shall have the authority to review any lease to ensure compliance with this section. Such review will be in camera and leases obtained by the California State Board of Optometry are not subject to the public disclosure requirement for information collected by state agencies. (f) No registered dispensing optician may have any membership, proprietary interest, coownership, or any profit sharing arrangement either by stock ownership, interlocking directors, trusteeship, mortgage, or trust deed, with an optometrist, except as permitted under this section 655. A registered dispensing optician or an optical company may have a direct or indirect landlord-tenant relationship with an optometrist only if all the conditions specified in subsection 655(e) are met. (g) No optometrist may have any membership, proprietary interest, coownership, or any profit-sharing arrangement, either by stock ownership, interlocking directors, trusteeship, mortgage, or trust deed, with an optical company, except as permitted under this section 655. An optometrist may have a direct or indirect landlord-tenant relationship with an optical company only if all the conditions specified in subsection 655(e) are met. (h) Nothing contained in this Section 655 shall prohibit a person licensed under Chapter 5 (commencing with Section 2000) of this division or its professional corporation from contracting with or employing optometrists, ophthalmologists or optometric assistants and entering into a contract or landlord tenant relationship with a Vision Care Plan, an optical company or a registered dispensing optician, in accordance with Sections 654 and 650. Any violation of this section constitutes a misdemeanor as to such person licensed under Chapter 7 (commencing with Section 3000) of this division and as to any and all persons, whether or not so licensed under this division, who participate with such licensed person in a violation of any provision of this section.

2556. It is unlawful for a registered dispensing optician to do any of the following: to advertise the furnishing of, or to furnish, the services of an optometrist or a physician and surgeon; to directly employ an optometrist or a physician and surgeon for the purpose of any examination or treatment of the eyes; or to duplicate or change lenses without a prescription or order from a person duly licensed to issue the same. For the purposes of this section, to "furnish" does not mean to enter into a landlord tenant relationship of any kind.