The number of medical spas (“med spas”) has increased exponentially in recent years. A med spa is a location where a patient can go for a variety of cosmetic and (typically) non-invasive procedures—ranging from Botox® to chemical peels and laser treatments.

There are several reasons for their increased popularity, one being because of technological improvements in the procedures leading to decreased recovery times. Another is correlated with decreasing reimbursements from health insurance companies caused, in part, by health reform. These reasons, among others, have led many physicians to move towards a cash-pay business like a med spa. Overall, the influx of med spas has many seeking to invest in them due to their popularity and potential high return.

Despite a med spa’s lucrative prospects, investing, owning, or operating one still means taking heed of certain regulations. Unfortunately, many states offer little or even conflicting guidance on these specifics. Generally, the two major regulatory considerations are (1) the corporate practice of medicine, and (2) proper supervision over those providing med spa services.

The prohibition against the “corporate practice of medicine” is a rule many states have adopted that prohibits lay people or lay entities from employing physicians or offering professional medical services. States that have strong corporate practice of medicine rules include Texas and California. These states, along with several others, explicitly provide that providing the types of non-invasive, elective procedures a med spa provides does entail the practice of medicine. As a result, this prohibition must be taken into account when setting a med spa up.

Texas specifically recognized that little guidance existed and recently expanded on the provision of cosmetic services. This guidance can be found in the Texas Administrative Code (“TAC”), Section 193.17, “Nonsurgical Medical Cosmetic Procedures”. This statute clarifies that the provision of nonsurgical, elective procedures is the practice of medicine. As such, a Texas med spa must take the prohibition against the corporate practice of medicine into account and be setup like a medical practice. This means it can be owned and managed by only a Texas licensed-physician. (See this article for more details on properly setting up a medical practice entity.)

The second major consideration in establishing and owning a med spa is proper supervision. Each state delineates who can provide certain types of medical services, which in Texas, includes med spa services. For example, every state generally requires that only licensed physicians perform surgery on a patient. But not all states specifically outline what kind of licensing and training is required for someone to provide a med spa service. The TAC, however, provides additional guidance on supervision and training for Texas-based med spas.

A Texas med spa must either have a physician or mid-level practitioner (which includes a physician assistant or advanced practice nurse practitioner, but not a registered nurse) on site at all times. If the physician is not physically on site, and only the mid-level provider is, the physician must nonetheless be available for emergency consultations. A non-licensed person, however, may perform these non-invasive procedures at a Texas med spa so long as there are written protocols and proper advanced training. Overall, much like a medical practice, the managing physician is ultimately responsible for any services provided and for each patient’s safety. As such, any physicians involved with a Texas med spa in either an ownership or management capacity should understand these rules well.

Each state has its own guidance on the practice of medicine, which sometimes provides additional guidance for med spas. For more information and guidance on setting up, managing, or staffing a med spa please contact Michael Byrd at mbyrd@byrdadatto.com or 214.291.3202.

ByrdAdatto founding partner Michael Byrd

Michael S. Byrd

As the son of a doctor and entrepreneur, ByrdAdatto attorney Michael S. Byrd has a personal connection to both business and medicine.