The corporate practice of medicine (CPOM) doctrine shapes who can own and control a medical practice — and it varies widely by state. This explainer covers what CPOM is, why it matters for modern healthcare businesses, and how the MSO/MSA structure commonly responds to it.
What corporate practice of medicine means
The corporate practice of medicine (CPOM) doctrine generally restricts non-physicians and corporations from owning or controlling a medical practice, or from employing physicians to practice medicine. The goal is to keep clinical decisions in the hands of licensed clinicians rather than business owners or investors. CPOM is a state-level doctrine, so it looks different from state to state — and a number of states don't apply it strictly at all.
Why the doctrine exists
The underlying concern is the separation of medical judgment from commercial pressure. The doctrine aims to ensure that the person making clinical calls answers to a license and a standard of care, not to a profit target set by a non-clinical owner. Whatever one thinks of how it plays out in practice, that's the rationale courts and regulators generally cite.
Why it matters for med spas and telehealth
Many modern healthcare-adjacent businesses — med spas, telehealth companies, wellness and weight-loss brands — are owned by non-physician entrepreneurs or companies. In states with a strong CPOM doctrine, that ownership has to be structured carefully so the clinical and business sides are properly separated. Getting this wrong isn't a minor paperwork issue; it goes to whether the business is set up legitimately.
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A common response is the management services organization (MSO) model. In simplified terms, a physician-owned professional entity (often a PC) holds the clinical side, while a separate management company handles non-clinical operations — marketing, scheduling, facilities, administration — under a management services agreement (MSA). A medical director typically sits within the clinical entity. Whether and how to use this structure, and how to draft the MSA, are legal questions for qualified counsel.
This article is general information, not legal advice. CPOM structuring decisions — entity formation, ownership, and management agreements — should be made with qualified healthcare counsel familiar with your states.
Which states are commonly cited
States such as California, New York, New Jersey, Illinois, and Texas are commonly described as having stronger CPOM doctrines, while many others are more flexible. These characterizations have real nuance and change over time, so treat them as general background rather than a definitive map. Confirm specifics for your state — the requirements by state hub is a useful orientation point.
Practical steps for operators
- Identify every state you operate in or plan to enter
- Ask counsel whether each applies CPOM and what structure fits
- Clarify where the medical director and any clinical entity sit in that structure
- Keep clinical authority documented as resting with licensed clinicians
- Revisit the structure when you expand to new states or services
Where Freely fits
Freely doesn't provide legal structuring or draft MSAs — that's your counsel's role. What Freely does make easier is the clinical piece: matching you with a state-licensed medical director whose credentials, documented scope, and rate are visible before you commit, so the clinical entity has the right provider in place. See how matching works or browse the marketplace.
Last reviewed: June 15, 2026. General information, not legal advice. Confirm requirements with your own counsel or state board. Freely is a HIPAA-compliant, compliance-aware marketplace, not a law firm.