MedSpire Health is seeing the same pattern repeat across the medical aesthetics, wellness, and telehealth sectors: a non-physician operator builds a successful practice, decides to expand into a new state, and discovers only then that the business entity they built was never permitted to own a medical practice in the first place. The Corporate Practice of Medicine doctrine was always in effect. Nobody told them.CPOM is not a new law. It exists in some form in most U.S. states and restricts non-physicians from owning or controlling the entity that delivers medical services. In states with active enforcement — California, Texas, New York, and others — the consequences of getting the structure wrong include voided contracts, payer audits, license exposure for the physicians involved, and in some states, civil and criminal liability for the owners. The problem is not that operators are reckless. The problem is that CPOM is invisible until it isn't.
The compliant structure requires separating the business from the medicine. A Management Services Organization — owned by the non-physician operator — provides administrative and operational support. A Professional Corporation — owned by a licensed physician — delivers the medical services, employs or contracts the clinical staff, and holds the patient relationship. The MSO and PC are connected by a Management Services Agreement that defines the boundary between them. Getting that boundary right is the work. Most operators find out it was drawn wrong only when something else goes wrong first.
"The structure has to be built before you enter a state, not after you've already started seeing patients," said Paula Kokko, CEO and Co-Founder of MedSpire Health. "We work with operators who are expanding into California or Texas and assume their existing LLC covers them. It doesn't. In a CPOM state, the entity that owns the business cannot be the entity that delivers care. Those have to be two separate things, legally controlled by two separate parties. The faster an operator is growing, the more critical it is to get this right before the next state, not after."
MedSpire Health structures MSO-PC arrangements for med spas, wellness clinics, and telehealth platforms operating under Corporate Practice of Medicine requirements. Services include Professional Corporation formation, Management Services Agreement drafting, medical director engagement for the PC, ongoing compliance review, and multi-state structuring for practices operating across jurisdictions with different CPOM rules. The company also delivers Good Faith Exam systems, collaborating physician agreements for NPs and PAs, and compliance auditing for practices evaluating their existing structure.The rise of telehealth has increased regulatory complexity, as providers operating across multiple states must comply with different rules. Business operations, clinical authority, and prescribing oversight must be structured to meet each state's specific requirements.
"We talk to founders who have been operating for two or three years and have never had a CPOM conversation," Kokko said. "At that point the fix is harder, but it's still a fix. The alternative — continuing to operate with the wrong structure — is not a viable option once you know the gap exists. You can't unknow it."
Practices seeking to evaluate their current structure or build a compliant MSO-PC framework can request a consultation at medspire-health.com/mso-pc-framework .
About MedSpire Health
MedSpire Health provides clinical oversight infrastructure and corporate compliance structuring for med spas, wellness clinics, and telehealth providers. Services include MSO-PC framework design, medical director engagement, collaborating physician agreements for NPs and PAs, Good Faith Exam delivery, and compliance auditing. MedSpire structures these relationships to satisfy state regulatory requirements and stays involved as practices grow and en...