Are you a North Carolina medical spa owner? If so, recent guidance from the North Carolina Medical Board could significantly impact how you operate. Avoid costly legal mistakes by ensuring your MedSpa follows proper compliance and business structure guidelines.
Understanding North Carolina’s MedSpa Ownership Rules
North Carolina has strict laws governing medical practices, including medical spas. The state prohibits non-medical professionals from owning or controlling businesses that provide medical treatments. This is to prevent financial incentives from influencing medical care decisions.
Key Legal Requirements:
- Only an MD or PA can own a medical practice.
- Medical treatments (anything that punctures the skin) must be performed by licensed medical professionals.
- Non-medical individuals cannot employ or control medical personnel.
- A MedSpa must operate as a legally structured medical entity with proper oversight.
How MedSpas Operate Legally in North Carolina
Since medical spas provide medical treatments, they must be structured to comply with North Carolina law. A common legal structure includes:
- A medical entity (owned by an MD or PA) that provides medical services.
- A management services company (an LLC owned by non-medical personnel) that handles non-medical aspects such as marketing, scheduling, leasing office space, and accounting.
These two entities must operate separately but work together through legally sound agreements.
Recent Case Study: Common Compliance Pitfalls
The North Carolina Medical Board recently reviewed a case where a MedSpa faced serious compliance violations:
- The MedSpa was owned by a non-medical professional, violating state laws.
- The business hired a medical director (MD) but failed to properly involve them in patient care decisions.
- Unsupervised medical staff performed laser treatments, leading to patient injuries.
- The medical director was unaware of who was working at the spa or their qualifications.
What Went Wrong?
- Ownership Violation: The business should have been owned by an MD or PA.
- Employment Violation: A non-medical entity cannot hire medical professionals.
- Lack of Supervision: MDs or PAs must directly oversee all medical treatments.
- Failure to Follow Agreements: Medical staff must have written supervision agreements with their overseeing physician.
Top 5 Compliance Mistakes MedSpas Make
- Non-Medical Owners Running the Business:
- Only MDs or PAs can own a medical entity.
- Non-medical individuals can operate a separate management services company.
- Improper Employment of Medical Professionals:
- Medical professionals must be employed by a medical entity, not a non-medical business.
- Lack of Supervision for NPs and PAs:
- Nurse Practitioners (NPs) and Physician Assistants (PAs) must have a supervising physician.
- There must be a written agreement between the NP/PA and the supervising MD.
- Unclear Financial and Operational Boundaries:
- Funds must not be improperly transferred between the medical entity and the management company.
- The medical director must be actively involved in medical decisions.
- Improper Supervision Agreements:
- Supervising physicians must actually meet with and oversee the medical personnel.
- Supervising physicians must practice in a relevant medical field.
Proposed Legislation That Could Affect Your MedSpa
In 2023, North Carolina lawmakers considered a bill that would have banned MDs from being paid to supervise NPs and PAs. While this bill did not pass, it signals potential future restrictions on how MedSpas structure their medical oversight. If compliance issues continue to rise, we may see stricter laws in the coming years.
How to Protect Your MedSpa Business
- Ensure Proper Business Structure: Separate medical and non-medical entities.
- Hire Legal Counsel: Work with a lawyer to draft compliant management agreements.
- Regular Compliance Reviews: Conduct periodic audits to ensure ongoing adherence to regulations.
- Stay Informed on State Regulations: Keep up with Medical Board updates and legislative changes.
Need Legal Help for Your MedSpa?
If you’re unsure whether your MedSpa meets North Carolina’s legal requirements, we can help. Our firm specializes in health and wellness business compliance and can guide you through setting up a legally sound MedSpa structure.
Contact us today to protect your business and stay compliant!
