Who Can Open a Medical Spa? State Ownership Rules

Key Takeaways

MDs and DOs can open medical spas in all U.S. states

Corporate Practice of Medicine doctrine restricts non-physician ownership

MSO model allows business ownership separate from medical practice

State requirements vary-verify local medical board rules first

Medical directors must hold active licenses in practice jurisdiction

Opening a medical spa requires navigating a complex regulatory landscape that varies dramatically by state. While medical doctors hold the clearest path to ownership, other healthcare professionals face jurisdiction-specific restrictions shaped by the Corporate Practice of Medicine doctrine. Understanding who can legally own and operate a medical spa depends on your professional credentials, your state’s regulatory framework, and the business structure you choose.

The question matters because choosing the wrong ownership model can result in license suspension, practice closure, or regulatory penalties. Aesthetic medicine sits at the intersection of healthcare and business, where medical board oversight meets commercial operation. Nurse practitioners, physician assistants, registered nurses, and non-medical entrepreneurs all explore medical spa ownership-but only specific pathways remain legally viable depending on where you practice.

Who Can Open a Medical Spa: Physician Ownership Requirements

Medical doctors (MDs) and doctors of osteopathic medicine (DOs) can open and own medical spas in every U.S. state without exception. State medical boards recognise physicians as qualified to oversee medical aesthetics because these procedures fall within the practice of medicine. Board-certified physicians in dermatology, plastic surgery, or family medicine commonly own medical spas, though specialisation isn’t legally required in most jurisdictions.

Physician-owned medical spas operate under straightforward regulatory pathways. The owning physician serves as medical director, maintains responsibility for treatment protocols, and supervises non-physician practitioners performing procedures. This structure aligns with medical spa compliance frameworks that prioritise clinical oversight.

Physicians who own multiple locations face additional complexity. Each location requires designated medical director oversight, which means hiring additional physicians or structuring supervision agreements across sites. Multi-location medical spa management demands systems that track practitioner credentials, treatment authorisations, and compliance documentation at scale.

Professional Corporation Structure for Medical Spa Ownership

Most states require medical spas to operate as professional corporations (PCs) or professional limited liability companies (PLLCs) when physicians own the practice. These legal structures restrict ownership to licensed healthcare professionals. A physician establishing a PC must verify that all shareholders hold active medical licenses-a requirement that prevents lay ownership but protects the physician-patient relationship.

PC formation requires filing articles of incorporation with your state, obtaining a federal employer identification number, and registering with your state medical board. The process takes 4-8 weeks in most jurisdictions. Once established, the PC operates as a distinct legal entity, shielding personal assets from business liabilities while maintaining the physician’s professional responsibility for medical services.

Understanding Corporate Practice of Medicine Doctrine

The Corporate Practice of Medicine (CPOM) doctrine prohibits non-physicians from owning medical practices in most U.S. states. This legal principle protects physician autonomy by preventing business interests from influencing clinical decisions. Texas, California, New York, Illinois, and Ohio enforce strict CPOM rules that directly impact who can open a medical spa.

CPOM restrictions emerged from concerns that corporate ownership would prioritise profit over patient care. State medical boards interpret these rules differently, but the core principle remains: medical judgment cannot be controlled by non-medical entities. A business owner cannot hire physicians as employees to perform medical procedures while maintaining ownership of the practice itself.

States without CPOM doctrine allow greater flexibility in medical spa ownership structures. Arizona, Colorado, and Washington permit non-physician ownership under specific conditions, typically requiring physician medical directors and defined supervision protocols. Verifying your state’s position on CPOM before investing in a medical spa prevents costly restructuring later.

How CPOM Affects Medical Spa Business Models

CPOM compliance shapes every aspect of medical spa operations-from ownership structure to profit distribution. In strict CPOM states, physicians must own the entity providing medical services. This requirement affects staffing models, contract negotiations, and financial planning. A dermatologist owning a medical spa in Texas cannot simply hire a nurse practitioner; the dermatologist must directly employ and supervise the NP within their physician-owned practice.

The doctrine also restricts fee-splitting between physicians and non-medical entities. If a non-physician owns the building and a physician owns the medical practice, their financial arrangements require careful structuring to avoid illegal fee-splitting. Regulatory compliance software helps practices document supervision relationships and maintain audit-ready records.

Can Nurse Practitioners Open Medical Spas

Nurse practitioner (NP) ownership of medical spas depends entirely on state scope of practice laws and CPOM enforcement. In states granting NPs full practice authority-including Minnesota, New York, Arizona, and New Mexico-nurse practitioners can legally own and operate medical spas under specific conditions. These states allow NPs to practice independently without physician oversight agreements.

Even in permissive states, NP-owned medical spas face regulatory scrutiny around procedure scope. Botox administration, dermal filler injection, and laser treatments may require physician delegation or medical director oversight depending on state board rulings. An NP opening a medical spa in Minnesota must verify that their state nursing board permits independent performance of planned aesthetic procedures.

Most states require NPs to work under physician collaboration or supervision agreements for medical aesthetics. These arrangements create grey areas in ownership: the NP may run daily operations and hold business ownership, but a physician medical director must oversee clinical protocols. This hybrid model appears frequently in states with moderate CPOM enforcement.

Nurse Practitioner Medical Spa Licensing by State

States categorise NP practice authority into three levels: full practice, reduced practice, and restricted practice. Full practice states allow independent NP practice without physician involvement. Reduced practice states require physician collaboration agreements. Restricted practice states mandate physician supervision. For medical spa ownership, full practice states offer the clearest legal pathway for NPs.

California permits NP ownership of medical spas through a carefully structured model. The NP operates under a standardised procedure agreement with a supervising physician who maintains medical director responsibility. The physician reviews treatment protocols, oversees injectable procedures, and signs off on clinical decisions-but doesn’t hold business ownership. This arrangement satisfies California’s CPOM requirements while allowing NP entrepreneurship.

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Medical Service Organization Model for Non-Physician Ownership

The Medical Service Organization (MSO) model allows non-physicians to own medical spa operations while maintaining CPOM compliance. Under this structure, the MSO owns business assets-real estate, equipment, marketing, and administrative staff-while a separate physician-owned entity provides all medical services. The two entities operate under a management services agreement that defines their relationship.

An MSO arrangement splits ownership into two legal entities. The non-physician entrepreneur owns the MSO, which handles non-medical business functions. A physician owns the professional corporation that delivers medical treatments. The MSO charges the PC a management fee for administrative services, creating a legal revenue stream for the business owner without violating CPOM restrictions.

MSO structures require meticulous documentation to withstand regulatory scrutiny. The management services agreement must clearly delineate which entity controls clinical decisions versus business operations. State medical boards examine MSO arrangements for disguised fee-splitting or de facto corporate practice of medicine. An MSO that dictates treatment protocols or patient care standards crosses into illegal territory.

How MSO Agreements Work in Practice

A typical MSO agreement assigns specific responsibilities to each entity. The MSO provides marketing services, facility management, scheduling software, inventory purchasing, and billing infrastructure. The physician-owned PC employs clinical staff, maintains treatment protocols, oversees patient care, and holds all medical licenses. Revenue flows from patients to the PC, which then pays the MSO its contracted management fee.

Management fees typically range from 30% to 50% of PC revenue, though states regulate these percentages to prevent excessive extraction that could influence medical judgment. Texas and California impose strict scrutiny on MSO fee structures. The physician must retain meaningful financial benefit from medical services-an MSO extracting 80% of revenue would likely trigger regulatory action.

Medical Director Requirements for Medical Spas

Every medical spa requires a designated medical director who holds an active physician license in the state where services are provided. This physician assumes legal and ethical responsibility for all medical treatments, even those performed by nurse practitioners, physician assistants, or registered nurses. Medical director requirements vary by state, but core responsibilities remain consistent: establishing treatment protocols, training staff, reviewing patient cases, and maintaining on-site or on-call availability.

Medical directors cannot simply lend their name to a practice. State medical boards expect meaningful oversight, which typically includes regular on-site presence, documented protocol reviews, and participation in adverse event investigations. A dermatologist serving as medical director for a medical spa must review injectable techniques, audit patient charts, and approve new treatment additions.

Some states mandate specific medical director qualifications beyond licensure. Florida requires medical directors of medical spas to hold board certification in dermatology, plastic surgery, or another relevant specialty. Other states accept any licensed MD or DO regardless of specialisation, though malpractice insurers may impose their own specialty requirements.

Medical Director Supervision Models

States define medical director supervision along a spectrum from direct oversight to general supervision. Direct supervision requires the physician to be physically present during procedures. Indirect supervision allows the physician to be immediately available by phone or pager. General supervision permits protocols to be followed without real-time physician involvement, though periodic chart review is mandatory.

Most states allow general supervision for cosmetic procedures like Botox or dermal fillers when performed by qualified practitioners. Laser treatments may require indirect supervision depending on device classification and procedure invasiveness. Medical spas must document their supervision model in policy manuals and demonstrate compliance during inspections. Practice management software with staff credential tracking helps medical directors maintain oversight records.

Can Registered Nurses Own Medical Spas

Registered nurses cannot own medical spas in states with strict CPOM enforcement, but may hold ownership in permissive jurisdictions through specific business structures. RN ownership always requires a physician medical director who oversees medical services, regardless of state regulations. The RN owns the business entity while the physician maintains clinical authority-a distinction that satisfies regulatory requirements in some states.

Arizona allows RN ownership of medical spas under physician delegation agreements. The RN operates the business and employs staff, while a contracted physician medical director approves treatment protocols and supervises medical procedures. This model mirrors the MSO structure but with the RN directly owning the practice entity rather than separating business and medical operations.

RN-owned medical spas face narrower procedure scopes than physician-owned practices. Registered nurses cannot independently prescribe medications or perform invasive procedures, which limits available service offerings. Botox administration requires physician delegation in most states. Chemical peels, microneedling, and IPL photofacials fall into grey areas where state nursing boards and medical boards issue conflicting guidance.

RN Medical Spa Ownership Challenges

The primary challenge RN owners face is recruiting and retaining qualified medical directors willing to assume legal responsibility for another person’s business. Physicians bear malpractice liability for treatments performed under their oversight, creating risk without commensurate control. Medical director fees reflect this reality-RN-owned medical spas typically pay physicians 25-40% of procedure revenue or $3,000-$8,000 monthly retainer fees.

Insurance companies scrutinise RN-owned medical spa applications more heavily than physician-owned practices. Underwriters view non-physician ownership as elevated risk, resulting in higher premiums and more restrictive policy terms. Some carriers decline coverage entirely for RN-owned medical spas in strict CPOM states, forcing practices to seek speciality insurers at premium rates.

State-by-State Medical Spa Ownership Variations

Medical spa ownership rules diverge dramatically across U.S. states, reflecting each jurisdiction’s approach to healthcare regulation and corporate practice doctrine. Understanding these variations prevents entrepreneurs from building businesses on legally unstable foundations. State medical boards update regulations periodically, making ongoing compliance monitoring essential for multi-state operators.

Texas enforces among the strictest CPOM rules in the country. Only physicians can own medical practices, and the physician must be present when advanced procedures are performed. Nurse practitioners and physician assistants work under physician delegation agreements with clearly defined supervision requirements. Non-physicians cannot have ownership stakes in Texas medical spas, eliminating MSO structures common in other states.

California permits MSO arrangements but heavily regulates them. The physician-owned medical group must maintain meaningful independence from the MSO. Fee-splitting restrictions limit how revenue flows between entities. California Business and Professions Code Section 2052 defines unlawful corporate practice, and violators face license suspension or practice closure.

States Allowing Modified Ownership Structures

Several states allow non-physicians to own medical spas with specific safeguards. Arizona permits nurse practitioner and registered nurse ownership under physician supervision agreements. Washington allows similar arrangements provided the physician medical director maintains clinical authority. These states prioritise healthcare access over strict ownership restrictions, viewing non-physician entrepreneurs as legitimate business operators when proper medical oversight exists.

Florida distinguishes between office-based procedures and surgical centres, imposing different ownership requirements. Medical spas offering only non-surgical cosmetic treatments face less restrictive ownership rules than facilities performing surgical procedures. This tiered approach recognises varying risk levels across aesthetic medicine services.

Legal Structure Options for Medical Spa Ownership

Choosing the right legal structure determines tax treatment, liability protection, and regulatory compliance for medical spa owners. Professional corporations, limited liability companies, partnerships, and MSO arrangements each carry distinct advantages and limitations. The optimal structure depends on ownership composition, state regulations, and long-term business goals.

Professional corporations remain the default choice for physician-owned medical spas in CPOM states. PCs protect personal assets from business liabilities while satisfying regulatory requirements for physician ownership. Formation requires state medical board approval, articles of incorporation filing, and ongoing compliance with professional corporation statutes. Most states limit PC shareholders to licensed professionals, preventing lay ownership.

Limited liability companies offer operational flexibility when state law permits non-physician ownership. An LLC structure separates business debts from personal assets while allowing pass-through taxation. Multi-member LLCs accommodate partnerships between physicians and non-medical investors, though CPOM states prohibit this arrangement for medical service delivery.

Partnership Structures in Medical Spa Ownership

Medical spa partnerships between physicians bring shared expertise and capital but require clear governance agreements. Partnership agreements should define profit distribution, decision-making authority, exit provisions, and dispute resolution mechanisms. A dermatologist and plastic surgeon opening a medical spa together need documented protocols for patient allocation, equipment purchases, and service line expansion.

Silent partners-investors who provide capital without operational involvement-create CPOM complications in medical spas. A physician cannot simply accept investment from a non-medical partner who receives profit distributions. The arrangement must ensure the investor has no control over clinical decisions and receives only legitimate returns on capital investment rather than sharing in medical service fees.

Licensing and Permits for Medical Spa Operations

Opening a medical spa requires multiple licenses beyond physician credentials. Business licenses, facility permits, health department approvals, and equipment registrations all factor into legal compliance. The specific requirements depend on services offered, facility size, and local ordinances. Laser devices require manufacturer certification and often state health department registration. Facilities performing procedures under sedation face surgical centre licensing requirements in many states.

State business licensing typically involves registering your business name, obtaining an employer identification number, and securing any required professional certifications. Local municipalities may require occupancy permits, zoning approvals, and fire safety inspections before you can operate. A medical spa in a retail location needs commercial zoning designation permitting medical services-residential or standard retail zoning won’t suffice.

Medical waste disposal permits apply when your medical spa offers injectable treatments. Sharps containers, biohazard bags, and pharmaceutical waste all require contracted disposal through licensed medical waste companies. Health departments inspect waste handling procedures during routine visits, and violations result in fines or operating restrictions.

Equipment and Device Registration Requirements

Medical aesthetic devices fall under FDA jurisdiction, and states often impose additional registration requirements. Class II and Class III medical devices require proper operator training and documentation. A medical spa purchasing an IPL device must register it with state health authorities, maintain service records, and ensure operators complete manufacturer-specified training. FDA inspectors audit device records during facility inspections.

Some states mandate separate facility licenses for laser services. New York requires facilities offering laser treatments to obtain a Certificate of Need before operating. California classifies certain laser devices as requiring physician supervision, affecting who can perform treatments. Medical spas expanding service offerings must reverify compliance whenever adding new device categories.

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Conclusion: Navigating Medical Spa Ownership Requirements

Medical spa ownership pathways depend on professional credentials, state regulations, and chosen business structure. Physicians hold the clearest route to ownership in all states, while nurse practitioners and registered nurses face jurisdiction-specific restrictions shaped by CPOM doctrine. The MSO model provides a legal framework for non-physician business ownership when properly structured, though it demands meticulous documentation and regulatory compliance.

Before investing in a medical spa, verify your state’s position on corporate practice of medicine, consult healthcare attorneys familiar with your jurisdiction, and secure appropriate medical director agreements. The regulatory landscape shifts as state medical boards issue new guidance, making ongoing compliance monitoring essential. Medical spas built on solid legal foundations avoid costly restructuring and regulatory penalties while establishing sustainable businesses in aesthetic medicine.

Frequently Asked Questions