You may have seen this doctrine referred to as the corporate practice of medicine (CPOM); however, naming it as such is limiting because the doctrine implicates more than just the practice of medicine. Therefore, we prefer to refer to the doctrine as the corporate practice of healthcare (CPOH). The CPOH is a broad legal doctrine prohibiting non-licensed persons, including individuals and business entities, from practicing healthcare, including medicine, podiatry, dentistry, optometry, chiropractic, etc.
The CPOH doctrine arises from the idea that those with similar values and desire to uphold similar ethical principles should control the business of healthcare. In other words, the purpose of the doctrine is to prevent non-licensed persons from influencing professional healthcare treatment decisions that could cause a healthcare professional to divide his or her loyalty between generating profits and delivering quality care.
Each state has its own rules concerning the doctrine. Some states have strict rules, meaning only licensed healthcare professionals can own healthcare practices. Some states have no prohibition, meaning anyone can own a healthcare practice. Some states have a hybrid model, meaning they allow for joint ownership by licensed healthcare professionals and non-licensed persons. Other states prohibit only certain industries from engaging in the CPOH.
The Corporate Practice of Healthcare in Florida
Florida fits into the last bucket. Florida law does not prohibit the CPOH for physicians, i.e., medical doctors and osteopathic physicians. Non-physicians can solely own a medical practice or jointly own a medical practice with physicians. However, in an entity owned by non-physicians, Florida requires that the practice register as a health care clinic and a physician be employed as a medical director to oversee, direct and supervise the medical aspects of the entity.
In contrast, dentists and optometrists are generally prohibited from engaging in the CPOH. The same rule applies to chiropractors. However, if a practice provides chiropractic and other healthcare services by physicians, non-professionals may own the practice.
Consequences of Failing to Comply with the Corporate Practice of Healthcare Rules
Healthcare providers must be careful to comply with the CPOH doctrine because violating these laws could result in loss of license and repayment of all revenue for billed services to patients, insurance companies and the government, as well as other fines and penalties, including criminal penalties.
