Corporate Practice of Medicine (CPOM) Guide: Florida
This guide provides a summary of Corporate Practice of Medicine (CPOM) laws in Florida. CPOM doctrine is a legal framework designed to prevent business interests from interfering with medical decision-making. These laws vary by state and generally prohibit corporations and non-physicians from owning or controlling medical practices.
Read on to learn about Florida’s CPOM doctrine, compliant business structures, and practical steps for healthcare business owners to remain compliant while practicing medicine.
Florida CPOM Summary
Unlike many states, Florida does not have a formal Corporate Practice of Medicine doctrine. This means that non-physician entities, corporations, and private investors can own and operate medical practices and even employ physicians. However, Florida has specific regulations that businesses must follow to remain compliant.
The most significant regulations include:
The Health Care Clinic Act, which requires licensing for non-physician-owned medical practices that bill insurance.
Fee-splitting prohibitions, which restrict payment arrangements that incentivize patient referrals.
Business structure limitations, which allow physicians flexibility in forming practices but still require adherence to professional regulations.
While Florida remains more business-friendly compared to states with strict CPOM laws, recent efforts by the Florida Medical Association could bring future changes that restrict corporate ownership of medical practices.
What Is CPOM Doctrine?
CPOM doctrine exists in many states to prevent non-physicians from controlling medical practices. The goal is to ensure that financial interests do not interfere with patient care and that only licensed professionals make medical decisions.
In states with CPOM laws, physicians must own and control medical practices, while corporations and investors are prohibited from directly employing physicians.
However, Florida does not follow a strict CPOM doctrine. Here, corporations and non-physicians are generally allowed to employ physicians and own medical businesses, provided they comply with state regulations.
Summary of Current Florida Law
Florida’s lack of a formal CPOM doctrine does not mean medical businesses can operate without restrictions. There are key regulatory requirements to be aware of:
1. No Explicit Ban on Corporate Physician Employment
Unlike many other states, Florida does not prohibit non-physicians from employing physicians or owning medical practices.
2. Health Care Clinic Act (2003)
If a medical practice is not 100% physician-owned and bills insurance, it must obtain a Health Care Clinic License from the Florida Agency for Health Care Administration (AHCA). Failure to obtain this license is a felony, with fines up to $5,000 per day.
3. Fee-Splitting Restrictions
Florida law prohibits physicians from paying for patient referrals or engaging in percentage-based compensation structures that generate referrals. However, percentage-based management fees for non-referral services (such as billing and administrative work) are generally allowed.
4. CPOM Laws for Other Medical Professions
While physicians are not restricted, Florida explicitly prohibits corporate practice in:
Dentistry – Non-dentists cannot own dental practices or employ dentists.
Optometry – Non-optometrists cannot employ optometrists or control optometry businesses.
Business Structure Options in Florida
Since Florida allows corporate ownership of medical practices, physicians and healthcare businesses have several structuring options:
1. MSO-Friendly PC Model
Many healthcare businesses use the Management Service Organization (MSO) model. A physician-owned Professional Corporation (PC) provides medical services, while a separate MSO handles administrative operations (billing, HR, marketing). This keeps business and medical control separate, helping practices comply with fee-splitting laws while allowing non-physician investment.
2. Professional Service Corporations (P.A.)
A Professional Service Corporation is a type of corporation specifically for licensed professionals. Only members of the same profession can be shareholders, officers, or directors. This provides limited liability protection for physicians.
3. Professional Limited Liability Companies (PLLCs)
A PLLC is similar to a P.A. but structured as an LLC. This provides limited liability benefits while allowing physicians to control their practice.
4. Regular Business Corporations or LLCs
Unlike many states, Florida allows physicians to organize their practices as standard corporations or LLCs. This flexibility enables non-physicians to own and invest in medical businesses.
Each of these structures has advantages and compliance requirements. Choosing the right model depends on ownership goals, liability concerns, and regulatory risks.
Staying Compliant in Florida
While Florida’s CPOM rules are flexible, businesses must navigate several legal requirements to stay compliant:
1. Obtain a Health Care Clinic License (if required)
If a medical practice is not fully owned by physicians and bills insurance, it must obtain a Health Care Clinic License from AHCA. Failing to do so can result in felony charges and fines of $5,000 per day.
2. Follow Fee-Splitting Laws
Do not engage in referral-based compensation agreements where a physician pays for patient referrals. Do not structure management service fees as a percentage of medical revenue unless they are clearly tied to administrative tasks (billing, HR, office management).
3. Maintain Proper Business Structures
If using a Management Services Organization (MSO), make sure that clinical decisions remain fully under physician control. Non-physicians cannot influence patient care, dictate medical procedures, or control physician salaries.
4. Stay Aware of Potential Legal Changes
The Florida Medical Association has proposed legislation that could limit non-physician ownership of medical practices. If new CPOM restrictions pass, non-physician healthcare businesses may need to restructure their ownership models.
Key Takeaways
Here are some key takeaways for CPOM and healthcare business compliance in Florida.
Florida does not have a CPOM doctrine, meaning non-physicians can own medical practices and employ physicians.
Physician-owned medical practices that bill insurance must have a Health Care Clinic License—failure to obtain one can result in felony charges and fines.
Fee-splitting is prohibited, and management fees based on revenue must not be tied to referrals.
Florida allows various business structures for medical practices, including PLLCs, P.A.s, regular corporations, and MSO models.
Unlike physicians, dentists and optometrists cannot be employed by non-physicians.
The Florida Medical Association is pushing for stricter CPOM laws, which could change the regulatory environment in the future.
For businesses operating in Florida’s unique healthcare market, compliance is key to avoiding legal and financial risks.
Zivian Health Helps Healthcare Business Owners Navigate CPOM Compliance
Zivian Health specializes in helping healthcare providers and businesses navigate CPOM compliance. Whether you’re a physician interested in becoming a PC owner or a healthcare business seeking a compliant business model, we’re here to guide you every step of the way.
Contact Zivian Health today to learn more about our PC ownership and CPOM solutions.
