Medical Spas, or commonly referred to as MedSpas, have become more popular across the country. A MedSpa is defined as a combination of an aesthetic medical center and a day spa that provides nonsurgical aesthetic medical services under the supervision of a licensed physician.
MedSpas are a great way to provide a variety of services to the public, including, but not limited to massages, facials, aesthetic treatments, red light therapy, botox and other skin treatments to improve the health and look of an individual. As wonderful as they are, depending on where you are located, will depend on what the rules are in opening up a MedSpa. And, unfortunately, the rules may prevent you from starting a MedSpa for yourself.
When considering opening up a MedSpa, some questions to consider include the following:
- Who is allowed to own a MedSpa? Can a non-physician be an owner of MedSpa?
- Is it considered the practice of medicine?
- Who can profit from the revenue generated from a MedSpa?
In the state of New York, if a MedSpa offers any services that fall under the practice of medicine or are considered to be medical treatments, then ownership of the MedSpa is limited to only physicians. Anyone who is non-licensed or does not maintain a license to practice medicine is not allowed to be an owner of a MedSpa that is providing medical treatments.
However, non-licensed individuals may still be involved with the MedSpa without violating NY law. These include, but are not limited to the following:
- An individual may be hired by the MedSpa to perform non-clinical services on behalf of the facility, and be paid as either a contractor or employee, depending on the services being performed.
- An individual may also be hired through their Management Service Organization (MSO). The MSO would provide all of the non-clinical management services to the practice that is providing medical treatments in the Med Spa. Those non-clinical services may include any of the below:
- Billing Services
- Leasing Equipment
- Paying for insurance
- Covering business expenses on behalf of the MedSpa, including rent, inventory or supplies
- Marketing or Advertising Services
- Providing the non-clinical staff with salaries and benefits
It is imperative to understand the rules surrounding MedSpas, because if done incorrectly, the physician can risk the suspension or even loss of their medical license.
For those of you who read my previous article regarding Referral Fees, you understand that physicians are not allowed to share fees or revenue that’s generated from the care of patients with third-parties, whether they are licensed individuals or not. This is commonly referred to as “Fee Splitting”. If the MedSpa you are looking to own and/or join is providing medical services and the profits of the MedSpa are being shared between licensed and unlicensed individuals, this can create a violation of the rule of Fee Splitting.
By not following the strict guidelines of your given state, this may put the physician and the physician’s license at risk. With the current growth of MedSpas and the interest of non-licensed individuals to be a part of them, it is easy to lose sight of the rules and potential consequences of setting up this type of business.
If you are interested in more information about MedSpas, you can contact your local attorney to speak to them in more detail about this. Keep in mind that not all states have the same rules, and as indicated above, New York is very clear on ownership.
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