The Corporate Practice of Medicine (CPOM) doctrine prohibits unlicensed individuals and corporations from engaging in the practice of medicine and owning medical facilities. California, Texas, Ohio, Colorado, Iowa, Illinois, New York and New Jersey are just a few states that adhere to this legality. Physician services may only be provided by physicians and not by business entities. In these instances, it is not legal for a non-licensee to own any portion, no matter how small, of a physician practice.
In other states, Arizona, for example, the court held that the statutory and regulatory scheme of the Arizona Department of Health Services authorizes a corporation to be licensed as an Outpatient Treatment Center. The Legislature specifically permits ownership of a physician practice by a Non-Clinical Practice Owner (NCPO), who is not required to hold a medical or other health license.
NCPOs Bring Innovation, Reimagining Healthcare
As the healthcare landscape continues to shift to a more consumer-facing model and transitions from fees to value, we believe it’s the non-clinical owners that are the solution.
Think about it! In a space where we need fresh eyes to reimagine healthcare, NCPOs are individuals with a multitude of business tactics and acumen that go far beyond the training of physician owners. When they transition into healthcare, they defeat the learning curve with their entrepreneurial approach to build a solid business foundation. In many cases, their business skills far outpace those of physicians and clinicians in general.
On balance, NCPOs do not come “pre-loaded” as Healthcare Executives. They may have a gap in their knowledge of healthcare-specific rules, regulations, technology and culture. This group of entrepreneurs may have sufficient skills to keep a mature practice on an even keel, and it’s their ability to manufacture unique business solutions that are non-traditional in healthcare that makes this group extremely valuable.
Despite their knowledge gap, these non-clinical owners have a far better chance of transforming healthcare more quickly and more in tune with consumer demand. Not only do they not think outside the box, they don’t even know what a box is! It’s this refreshing look at healthcare that makes them a natural catalyst for healthcare’s positive transformation.
Who do you think is developing new apps, introducing retail-based products, inventing new methods to manage a supply chain, or looking at any healthcare business as an entity that needs to thrive for the sake of the business? It’s this group of NCPOs that are developing new business models and executing quickly in this post-COVID-19 world, where we have to reimagine how a medical practice works to thrive in any market.
Next Generation of Healthcare
At Healthwise Management, we have seen many great business leaders enjoy success in both clinical and non-clinical owned practices. Clinical owners can easily navigate the regulatory hurdles, but the winning move is to look toward the next generation of non-clinical business owners who use their transfer skills to blend the best of your clinical practice with their proven innovation. Ready to embrace the future of healthcare? We can help.
