Now more than ever, physicians, non-physician providers, and non-licensed providers are becoming interested in offering medical spa (medispa; medspa). According to a recent study [1], the global medical spa market is expected to reach USD 33.9 billion by 2026 with a compound annual growth ratio of 13.8%. This high growth rate can be linked in part to an increasing number of aesthetic treatments and an increasing variety of specialists entering the space.
However, while the medical spa industry continues to grow, so do the number of investigations by government healthcare regulators and state attorneys general. In recent years, investigations with respect to the unlicensed practice of medicine by cosmetologists and estheticians have become more common, and licensed providers are being investigated for violations of state scope of practice laws. The federal government has also taken an interest in certain financial arrangements, such as improperly structured space rental agreements, consulting, or medical director arrangements, which may be viewed as illegal inducements for referrals.
While medical spa services may present an exciting, and potentially lucrative, opportunity to expand service offerings, caution is merited. While it is common for aesthetic and cosmetic services to be marketed as pampering and self-care, it is important to note that many of the services constitute the practice of medicine, and are therefore, highly regulated. State-specific requirements dictate what services may be provided, and by whom. As experienced healthcare counsel, Frier Levitt advises physicians regarding both the federal and state-specific, rules and regulations governing aesthetic and cosmetic services, and the proper structuring of a medi spa business to enable physicians to reach their desired short or long-term financial/investment goals.
Background
The American Medical Spa Association (AmSpa) defines a “medical spa” as follows:
“Medical spas operate under the full-time supervision of a licensed medical professional in a spa-like setting. When visiting a medical spa, patients can be pampered with traditional spa services but also have the option of getting medical services like Botox, laser hair removal and medical-grade skin therapies. The medical professionals of the med spa are licensed, educated and trained in the medical procedures and treatments provided to ensure the highest level of care for every patient. State regulations differ as to what type of ‘medical professional’ can be an owner or medical director of a medical spa, so we recommend you contact your local attorney for your state’s laws and regulations.”
Traditionally, medical spa services have been provided by dermatologists and plastic surgeons, however, a larger variety of physician specialists (such as OB/GYNS, dentists, and pain medicine specialists) have begun providing cosmetic or “medical spa” services across the United States.
As a national boutique law firm focused on providing legal counsel to the healthcare industry, Frier Levitt is uniquely positioned to advise our physician clients on the broad range of issues faced regularly by aesthetic and cosmetic medical practices.
Medical Spa Regulatory Compliance, and Corporate Transactions
Our medical spa and cosmetic services legal team includes regulatory and corporate transactional attorneys adept at advising clients with regard to the preparation of corporate documentation, the sale or purchase of a medical spa/cosmetic medical practice, and the preparation of other legal documents required to run the business such as employment agreements, medical director agreements, or services agreements. The team also includes attorneys focused on regulatory compliance who advise clients on issues such as state-specific restrictions on the scope of practice for physician’s assistants, nurse practitioners, advances practice nurses, registered nurses, and estheticians, and the types of medical spa services which may be provided by physicians, non-physician providers, and non-licensed providers (i.e. the types of providers who may legally provide BOTOX, dermal fillers, laser, or hair removal treatments, based on applicable state regulations.)
Because many of the services offered in a medi spa setting constitute the practice of medicine, it is essential to determine the individuals who are legally permitted to furnish the services, and in cases where the services are legally delegable by a physician to a non-physician, it is important to determine what degree of physician supervision is required. Violations of state scope of practice regulations can result in discipline against a provider’s license, potential liability for injuries to patients, and other serious consequences. It is imperative that all practices offering aesthetic, cosmetic and/or “medical spa” services consult with experienced healthcare counsel to avoid potential legal pitfalls and scrutiny from state and/or federal regulators.
Medical Spa and Cosmetic Legal Services:
Whether you are considering the expansion of your current medical practice to include aesthetic or cosmetic services, or you are interested in starting your own medical spa, investing in an existing medical spa, there are a number of legal and regulatory issues that must be addressed.
Some of the common issues and legal concerns our physician clients must consider include, but are not limited to:
- Scope of Practice Laws and Regulations by state (whether for Physician’s Assistants, Nurse Practitioners, Registered Nurses, or Estheticians)
- Supervision and Delegation Requirements by state
- Laser, Broadband Light (BBL), Intense Pulsed Light (IPL), and other Photogenic Rejuvenation and/or Skin Resurfacing Laws and Regulations by State
- Medical Pedicures and Customized Foot Treatment for conditions such as Athlete’s Foot, Corns, etc. Regulations by State
- Injectable Laws and Regulations (BOTOX, dermal fillers such as Juvederm, Restylane, etc.) by state
- Platelet Rich Plasma Treatments/Facials involving the use of a patient’s own blood product
- Laser Hair Removal and Permanent Makeup Application (through traditional tattooing, Micoblading, Microshading, etc.) and Laser Tattoo Removal Laws and Regulations by state
- The Purchase or Sale of a Medical Spa/Cosmetic Medical Practice
- Medical Spa Corporate Document Preparation
- Cosmetic Medical Director Arrangements
- Obtaining Informed Consent, Making Disclosures, and Keeping Proper Documentation
- The Implications of Fee-Splitting and Federal and State Self-Referral and Anti-Kickback Laws (Stark Law, Federal Anti-Kickback Laws, State “mini-Stark” Laws, etc.) on the operations and Financial Arrangements of a Cosmetic Medical Practice
- Unlicensed Practice of Medicine by Cosmetologists/Estheticians
- HIPAA Compliance for Medical Spas
- State specific regulations for sanitation and disposal with regard to human tissues, sharps, etc.
- Other issues related to medical spa ownership, management, and/or legal compliance
- Laws Governing Medical Spa Advertising and Marketing
- Laws Governing Prescribing Controlled Substances
- Physician Collaboration Agreements, Joint Protocols, and Clinical Guidelines
How Frier Levitt Can Help
If you are a physician interested in expanding your practice to include the provision of aesthetic or cosmetic services, contact Frier Levitt today and ask to speak to an attorney on the Medical Spa and Cosmetic Services team.
[1] Medical Spa Market Size, Share & Trends Analysis Report By Service (Facial Treatment, Body Shaping & Contouring, Hair Removal, Scar Revision), By Region (North America, Europe, APAC, MEA), And Segment Forecasts, 2019 – 2026
Medical Spas and Cosmetic Services insights
DOJ’s Newly Implemented Voluntary Self-Disclosure Policy Incentivizes Corporate Responsibility and a Culture of ComplianceMarch 1, 2023
Medical Group Management Association (MGMA) 2023 Practice Management ConferenceJune 7, 2023