MedEsthetics magazines offers business education and in-depth coverage of the latest noninvasive cosmetic procedures for physicians and practice managers working in the medical aesthetics industry.
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LEGAL ISSUES | By Padraic B. Deighan, JD, PhD The Corporate Practice of Medicine The corporate practice of medicine (CPoM) doctrine prohibits a business entity from practicing medicine or employing a physician to provide professional medical services. Most states have CPoM regulations, which may manifest themselves through state law, medical boards and/or court opinions addressing ownership or control of healthcare providers by individuals or corporations that are not directly licensed to provide healthcare services. Some states merely prohibit the practice of medicine without a license or the sharing of fees between licensed and unlicensed individuals, while other states flatly prohibit unlicensed individuals from owning medical practices or employing medical professionals. The rationale behind CPoM regulations is that corporate profits should never be a factor in medical treatment decisions or interfere in any way with the physician's ability to exercise independent medical judgment. Medical decisions should be based solely on what is in the best interest of the patient. Another way to look at the CPoM doctrine is that it exists to prevent business entities or individuals who are not licensed to practice medicine—and therefore are not subject to the same professional standards and regulatory controls as licensed medical providers—from intruding into the practice of medicine. what they are is challenging because they can originate and be enforced in many different ways. According to my investigation, 45 states have some form of CPoM prohibition. The prohibitions may be established via statute, case law, mandates from a state board of medicine or through decisions made by the state attorney general. The degree of regulation and the manner in which the doctrine is regulated varies widely from state to state. For example, I have heard many times that Florida "allows" the corporate practice of medicine. While there are no statutory prohibitions against it, decisions by the state's attorney general dating back to 1995 prohibit non-physicians from owning a medical practice or hiring medical personnel. There are exceptions to the CPoM doctrine and its application in certain, limited situations. For example, hospitals are largely exempted from the doctrine and Health Maintenance Organizations (HMO's) have received exemptions as well, due to the understanding that these entities are essential to modern era delivery of health care. It is important to note that the CPoM doctrine applies to all licensed medical providers—not just physicians. This is especially important in aesthetic medicine as we will see below. Aesthetic Medicine and CPoM Identifying Regulations Determining whether a state has CPoM regulations and 22 NOVEMBER/DECEMBER 2013 | MedEsthetics The expansion of aesthetic medical practices and the introduction of medspas created an entirely new set of issues © ISTOCKPHOTO.COM Most states have regulations prohibiting the corporate practice of medicine, but violations are widespread in the field of medical aesthetics.