Care
The care sector is attracting considerable interest at present. It is a sector that is constantly being confronted with new rules and developments. One example is the introduction of market forces. As a result of all these changes, there is a growing need for specialist legal advice. For this reason, BANNING has an integrated team of specialists drawn from a range of areas of law, combining high-quality legal experience with specific knowledge of the care sector. We will be pleased to explain what this means for you as a care institution, based on the five areas of law that are particularly relevant to the care sector.
We would also like to draw your attention to our special newsletter: the BANNING ZorgBulletin, published about six times a year. A subscription is free of charge, and the newsletter will keep you up to date with all relevant developments in the care sector.
Procurement law
Since the introduction of the Social Support Act (Wet maatschappelijke ondersteuning, abbreviated to Wmo), the activities of all kinds of care-related services have become the responsibility of municipalities. In most cases, municipalities are obliged to purchase these services subject to the procurement rules. This means that usually the services may not be bought from a preferred party without first inviting tenders from competitors. This has already frequently been a subject of discussion with regard to home care, which is clearly evident from the number of court cases on the subject. But there may be an obligation to invite tenders for other services too that now come under the Wmo, such as welfare services, preventive youth care and client support. This is a matter that is often overlooked.
Employment law
In the care sector, flexibility and cost control are becoming increasingly important. Drafting, terminating and amending employment and apprenticeship contracts, as well as resolutive conditions, flexible working and redundancy schemes give rise to legal questions. What legal options exist, for example, when using apprenticeship and/or employment contracts? And what are the pitfalls when terminating such contracts? May an employment contract be amended unilaterally? And what about resolutive conditions? When do they result in termination of the employment contract? How can an on-call worker be contracted? And to what extent can the ‘revolving door arrangements’ be applied? Needless to say, it is absolutely vital to obtain the right legal answer to all these kinds of questions.
Competition law
Since the introduction of market forces in the care sector, competition law has become a fact of life in this sector. The Competitive Trading Act stipulates that mergers, acquisitions and joint ventures must be reported to the Netherlands Competition Authority (NMa) for approval, if the companies exceed certain turnover thresholds. In the care sector even lower turnover thresholds have been set, above which a concentration must be reported. In addition, the NMa has drawn up separate guidelines for other forms of cooperation. These guidelines deal in detail with a range of issues, such as negotiations through a healthcare broker, pure quality agreements, joint purchasing and preference policy. The right legal approach to competition issues is important, since agreements or forms of collaboration that conflict with the Competitive Trading Act are invalid. Care institutions also risk incurring heavy penalties from competition authorities and civil claims for damages from third parties.
Company law
Mergers, acquisitions, joint ventures, equity problems and control, financing and investment issues definitely also play a part in the strictly regulated healthcare sector with its specific regulations. Recent studies have even shown that private investors are increasingly interested in acquisitions in the healthcare sector. That development is entirely in keeping with the views of the current government, whose aim is to stimulate market forces in the healthcare sector and which is therefore drawing up regulations to broaden the possibilities of distributing profit to investors in that sector. In that light healthcare institutions that are considering raising private funds are advised to check whether they have the correct legal form to do so.
Of old, many healthcare institutions have been organised as foundations. But foundations are not the most appealing legal form for private investors, because foundations are prohibited from directly distributing profit to private investors. It is also more complicated for private investors in a foundation to influence the use of their investments without introducing liability risks. BVs (private limited liability companies) and cooperative associations do not have those disadvantages. A number of healthcare foundations have therefore opted for the legal approach of converting their healthcare foundations into a healthcare BV or a cooperative.
Issues regarding the relationship between e.g. the management, supervisory board, board of directors, medical staff and patient associations also require specialist knowledge of the healthcare sector.
All of this must be regarded in light of the increasingly strong demand on the market (from the government and the public) for transparency regarding the efficiency and quality of healthcare organisations, whereby the right financing and corporate structure are essential.
Property
As the role of the government in financing new buildings and maintaining care institutions is being scaled back, the problems relating to property have become increasingly complex. In the past, fixed standards used to apply concerning questions on how a building should be built, and the amount that the government would contribute to a development. Now that living and care have been separated and the building costs budgets abolished, the care sector must now stand on its own two feet and seek to do business with other parties in the market. Apart from the traditional questions relating to zoning plans, building permits and the actual building work itself, more and more expertise will be needed in the future in the area of cooperation with government authorities and with investors of public funds.
Contact
For advice, more information and to subscribe to the BANNING ZorgBulletin, please contact M.W.J. (Martijn) Jongmans:
T: +31 88-10 10 335
E: m.jongmans@banning.nl
Competition law
M.J. (Minos) van Joolingen, LL.M.
E: m.joolingen@banning.nl
Employment law
C.A.M. (Chantal) Grouls, LL.M.
E: c.grouls@banning.nl
Property
M.J.M.G. (Marga) van Gerwen, LL.M.
E: m.vangerwen@banning.nl
Company law
Dr. R.W.F (Rob) Hendriks, LL.M.
E: r.hendriks@banning.nl
or