Medspas Must Comply With Pennsylvania’s Corporate Practice of Medicine Doctrine
Medical spas (“Medspas”) offer luxurious treatments like massages, salt glows, and seaweed wraps. They also offer clinical procedures like Botox, laser hair removal, and dermabrasions. In Pittsburgh and the surrounding areas, these services are in high demand, and medical professionals and entrepreneurs are eager to break into the industry. But before they do, or if they already have, they should be aware of Pennsylvania’s Corporate Practice of Medicine Doctrine (the “CPOM”).
The CPOM stems from a 1938 Pennsylvania Supreme Court Case in which the Court determined that a department store could not employ optometrists in an optometry practice owned by the store. The Court’s decision focused on the principle that “a licensed practitioner of a profession may not lawfully practice his profession among the public as the servant of an unlicensed person or a corporation”. Following precedent from other state courts, the Court held that a corporation “cannot possess the personal qualities required of practitioners of a profession” because the licensed professionals would “owe their primary allegiance and obedience to their employer rather than to the clients or patients of their employer.”
In light of Gimbel Bros., Pennsylvania’s layered statutory and regulatory scheme produces the CPOM which generally requires that all medical services be rendered exclusively by (i) licensed medical professionals or (ii) business entities wholly owned by licensed medical professionals. This is not only to ensure safety, it is also to ensure medical professionals maintain high professional standards and retain autonomy over decisions related to the provision of medical services. Medspas that do not comply with the CPOM risk criminal and civil liability or enforcement from the state’s licensing boards.
1 Neill et al. v. Gimbel Bros., 199 A. 178 (Pa. 1938)
2 Id. at 219, quoting McMurdo v. Getter, 10 N.E.2d 139, 140 (Mass. 1937).
4 63 P.S. § 422.10; 63 P.S. § 271.3.
5 15 Pa.C.S.A. § 8105; 15 Pa.C.S.A. § 8996(b); 15 Pa.C.S.A. § 2923(a) (all providing that “all of the ultimate beneficial owners of the interests in” a limited liability company or corporation that provides medical services must be licensed persons in the profession the entity practices).