Can Non-Physicians Own a Medical Practice?
A Guide to Navigating State Laws
Can non-physicians own a medical practice? This question often arises for those wanting to enter the medical field. It’s not a simple answer. It depends on the state’s laws where the practice operates. If you want to join the healthcare industry, know the rules on owning a medical practice. They’re essential.
We’ll explain the laws and give non-physicians tips on navigating this complex, yet lucrative space.
What is the Corporate Practice of Medicine Doctrine?
The Corporate Practice of Medicine (CPOM) is a legal rule in many states and it restricts who can own and control a medical practice. These laws protect patient care. They keep financial interests from interfering with medical decisions.
Under CPOM, only licensed physicians can own and run medical practices in some states. The goal is to ensure that patient care is always the top priority. But this doesn’t mean non-physicians are completely locked out of the industry. In many states, non-physicians can legally and ethically get involved.
State Laws: The Deciding Factor
Whether non-physicians can own a medical practice depends on where you are. State laws on this topic fall into three main categories: strict, lenient, and hybrid.
Strict CPOM States
States like California and Texas have some of the strictest CPOM laws. In these states:
- Only licensed physicians can own or control a medical practice.
- Non-physicians cannot have any say in medical decisions.
In California, partnerships between physicians and non-physicians face strict regulations. This is to ensure compliance with CPOM.
Lenient CPOM States
In states like Florida and New York, the rules are more relaxed. Non-physicians can own medical practices, but:
- A licensed physician must oversee all clinical decisions.
- The organization allows ownership if it does not harm patient care.
These states allow investors to fund healthcare ventures if conditions are right.
Hybrid CPOM States
Some states, such as Illinois and Pennsylvania, take a middle-ground approach. Authorities may allow non-physician ownership. However, it often has strict rules to maintain medical ethics and standards of care.
How Non-Physicians Can Get Involved in Medical Practices
If you’re not a physician but want to own or invest in a medical practice, there are legal options available, even in strict CPOM states.
- Management Services Organizations (MSO): An MSO is a business. It manages a medical practice’s admin tasks, like billing, staffing, and marketing. Non-physicians can own and operate MSOs, which work in partnership with physician-owned practices.
- In states that allow them, physicians can form PCs or PLLCs. They can then contract with non-physician investors. This structure keeps physicians in control of medical decisions, and the business side can be handled separately.
- Joint Ventures: A physician and a non-physician can form a joint venture by partnering. In this model, the physician oversees medical services. The non-physician manages the business operations.
These structures help non-physicians assist in healthcare while complying with state laws.
Things to Keep in Mind
Before investing in a medical practice, consider these points:
- State Laws Matter: Always check the rules in your state to avoid legal trouble. Compliance with CPOM laws is essential due to their wide variation.
- Medical Decisions Stay with Physicians: Clinical decisions must stay with licensed physicians. This is true even if you own part of a practice.
- Get Legal and Financial Advice: Work with lawyers and accountants who specialize in healthcare. They’ll help you set up the right structure and ensure compliance.
Why Understanding CPOM Laws Is Important
The healthcare industry has great potential for growth and profit. But, it is also subject to strict regulations. Non-physicians who want to own a medical practice must know the rules. This is to avoid penalties and to build an ethical, sustainable business.
By following the law, you can build a business. It can support doctors and improve patient care, while growing your investment.
Final Thoughts
Non-physicians wanting to own or join a medical practice must follow state laws. They are key to success. There are legal and ethical ways to operate in healthcare. This can be through an MSO, a joint venture, or another approved structure.
To thrive in this regulated field, research state CPOM laws. Consult experienced healthcare attorneys. Build a business model that prioritizes patient care and ethics. By following these steps, non-physicians can enter the growing healthcare sector. They can also help improve medical services.
Navigating the complexities of medical practice ownership requires expert guidance. At Dike Law Group, we specialize in healthcare law and can help you understand your state’s Corporate Practice of Medicine (CPOM) laws, structure your business legally, and set you up for success. Whether you’re an entrepreneur, investor, or healthcare professional, we’re here to help you thrive in this regulated but rewarding industry.Schedule a FREE Intake discussion Today to discuss your goals and ensure you’re on the right path to compliance and ethical medical practice ownership. Don’t leave your success to chance—partner with the experts!