A medical director is not a checkbox. In most states, every med spa that delivers Botox, dermal fillers, laser treatments, or any procedure classified as the practice of medicine must operate under the supervision of a licensed physician. But the gap between "we have a medical director on paper" and "we have a legally defensible supervisory relationship" is where practices get fined, shut down, or sued.
This article is for med spa owners, operators, and the physicians who serve (or are asked to serve) as medical directors. It covers what a real agreement must contain, what makes it a sham, and how the Corporate Practice of Medicine doctrine turns sloppy paperwork into enforcement risk.
What a Medical Director Actually Does
A medical director is the physician who holds clinical authority over medical services in the practice. This is not an honorary title. The role carries specific, documentable duties:
- Protocol development and approval. The medical director writes or approves treatment protocols for every medical procedure the spa offers — injectables, laser parameters, chemical peel depths, IV formulations, and contraindication screening workflows.
- Supervision of delegated acts. In most states, RNs, NPs, PAs, and medical assistants perform medical procedures under the medical director's delegation. The director sets the supervision standard (on-site, available by phone, chart review cadence) and must be able to demonstrate it was followed.
- Chart audit and quality assurance. The agreement should specify how often the director reviews patient charts. Monthly reviews are a common minimum; quarterly is a floor in looser states. The director documents findings and corrective actions.
- Emergency readiness. The medical director ensures the practice has emergency protocols, that staff are trained to execute them, and that the medical director (or a designated covering physician) is reachable when patients are being treated.
- Staff credentialing and competency sign-off. The director verifies that every injector, laser operator, and nurse holds the appropriate state license and has received training sufficient for the procedures they perform.
The Corporate Practice of Medicine Doctrine
The Corporate Practice of Medicine (CPOM) doctrine is the legal principle at the center of almost every med spa enforcement action. It prohibits non-physicians — including corporations, investors, and entrepreneurs — from owning, controlling, or practicing medicine. The doctrine exists in some form in a majority of states, and enforcement is especially aggressive in California, Texas, New York, Illinois, and Ohio.
Why CPOM matters for medical director agreements
In strict CPOM states, only a licensed physician (or a physician-owned professional entity) can own the clinical side of a med spa. If a non-physician owns the practice and simply pays a physician to sign off as medical director, that arrangement violates CPOM regardless of how the contract is worded. The physician must have genuine clinical authority — not just a signature authority that the business owner controls.
The common workaround is a two-entity structure: a physician-owned Professional Corporation (PC) that holds the medical license and employs the clinical staff, paired with a Management Services Organization (MSO) that the non-physician owner controls. The MSO handles marketing, billing, real estate, and HR. The PC handles everything clinical. The medical director agreement lives inside the PC, not the MSO.
What makes an arrangement a "rented license"
State medical boards and attorneys general look for specific red flags that indicate the physician is renting their license rather than practicing medicine:
- The physician has no authority to hire, fire, or discipline clinical staff.
- The physician cannot independently set or modify treatment protocols.
- The non-physician owner controls scheduling, pricing, and which procedures are offered.
- The physician is paid a flat monthly fee regardless of clinical involvement.
- The physician has never visited the practice, reviewed a chart, or met the staff.
- The physician signs standing orders for patients they have never examined.
Texas is explicit: under the Texas Medical Board's delegation rules (previously §193.17, now consolidated into 22 Tex. Admin. Code §§169.25–169.27), when a doctor allows a spa to use their prescriptive authority, they assume all medical director responsibilities regardless of whether a written agreement exists. The absence of a written contract is not a defense — it makes things worse.
What a Real Medical Director Agreement Must Contain
Every clause below should be present in a medical director agreement that can survive a regulatory audit. This is not a template — it is a checklist of what the document must address.
1. Scope of services
Define every medical service the director oversees. A vague reference to "aesthetic treatments" is insufficient. Name the procedures: neuromodulator injections, HA filler injections, biostimulator injections, laser and IPL treatments, chemical peels, microneedling, IV therapy, weight-loss medication injections. Each procedure should map to a written protocol the director has approved.
2. Qualifications and credentialing
The physician must hold an active, unrestricted medical license (MD or DO) in the state where the practice operates. The agreement should require the physician to maintain current DEA registration, malpractice insurance (with minimum coverage amounts specified), and any board certifications relevant to the procedures being supervised.
3. Hours, availability, and supervision standard
Specify how many hours per month the director spends on-site, how quickly they must respond to emergencies, and whether they are available by phone, telemedicine, or must be physically present when certain procedures are performed. States like Iowa require the medical director to provide at least four hours of on-site supervision per week and remain within 60 miles of the facility.
4. Chart review and quality assurance
Set a minimum chart review frequency. Document the process: how charts are selected, what the director evaluates, and how findings are communicated back to the practice. Quality assurance meetings should be scheduled and minuted.
5. Protocol ownership and clinical autonomy
The agreement must state that the medical director has sole authority over clinical decisions, treatment protocols, and clinical staffing. The business owner or MSO cannot override a clinical decision. This clause is what separates a legitimate arrangement from a CPOM violation.
6. Compensation
Compensation must reflect fair market value for the time and complexity of the work. It cannot be tied to patient volume, revenue, or the number of procedures performed — that is fee-splitting, and it is illegal in every state. Industry data from 2025 shows a typical range of $1,000–$1,500 per month per provider supervised, but this varies by state, scope, and the director's specialty.
7. Liability and indemnification
The medical director carries their own malpractice insurance. The agreement should specify who is responsible for what: the director is liable for their clinical decisions; the practice entity is liable for operational failures (equipment, staffing, facilities). Mutual indemnification clauses are standard.
8. Term, termination, and transition
Define the agreement's duration and how either party can terminate it. Include a transition period — if the director leaves, they should continue covering for 30–60 days while a replacement is found. This protects patients mid-treatment and prevents a gap in supervision.
9. Compliance with laws
A catch-all clause committing both parties to comply with all applicable federal and state laws, including CPOM, anti-kickback statutes, HIPAA, and state medical practice acts. This seems obvious, but its absence is a liability.
10. Records and documentation
The agreement should specify that the medical director maintains copies of all protocols, chart reviews, training sign-offs, and quality assurance records. These are the documents a state board will request in an audit.
Specialty Alignment
California law requires that a supervising physician be qualified and experienced in performing the services they supervise. The general rule — that the medical director should practice within their licensed specialty — means a dermatologist or plastic surgeon is the natural fit for an aesthetic practice. However, cosmetic procedures like Botox, filler injections, and laser treatments may not fall squarely in one particular board certification, and many med spas use emergency medicine, family medicine, or internal medicine physicians as medical directors. This is not inherently illegal, but it increases scrutiny. If a complication arises and the medical director's specialty bears no relation to aesthetic medicine, both the director and the practice face heightened liability exposure. The director should be able to demonstrate training, continuing education, and competency specific to the procedures being supervised — regardless of their primary board certification.
State-Specific Variables That Change the Agreement
The structure of the agreement depends heavily on the state. Several variables differ:
Who can serve as medical director. Most states require an MD or DO. Seven states — Colorado, Connecticut, New Mexico, Oregon, Arizona, Washington, and Illinois — allow nurse practitioners to serve in this role under specific conditions.
Physician ownership requirements. Five states require physician ownership of the med spa entity: California, Texas, New York, New Jersey, and Ohio (with nuances in each). In these states, the medical director is typically also the owner or part-owner of the PC.
Supervision intensity. Iowa mandates on-site supervision for at least four hours per week. California requires that a physician examine each patient before delegating a procedure to an RN or PA. Arizona allows NPs to practice independently with full practice authority, reducing the medical director's direct supervision burden. Georgia requires a written Nurse Protocol Agreement for APRNs and allows RNs to inject under a physician's written order, but prohibits delegation of injections to medical assistants.
Oregon's tightening law. Oregon SB 951, signed into law June 2025, expands CPOM restrictions by prohibiting MSOs and their principals from owning or controlling professional medical entities, with a private right of action for physicians. The CPOM restrictions apply to new MSOs starting January 2026 and to existing arrangements by January 2029. This closes the "friendly PC" loophole that previously allowed unlicensed entities to exert influence over medical practices.
The Medical Director vs. the Collaborating Physician
These are not interchangeable roles. A medical director holds overall clinical authority over the practice. A collaborating physician signs a collaborative practice agreement with a specific NP or PA, defining the supervisory relationship for that individual provider. A single physician can fill both roles, but the agreements are separate documents with different legal requirements.
In states with restricted NP practice authority — like Florida, North Carolina, and Michigan — an NP must have a collaborative practice agreement with a physician. That physician may or may not be the med spa's medical director. The practice needs both agreements on file.
How to Audit Your Existing Agreement
If you already have a medical director agreement, review it against these questions:
- Does the agreement list every procedure the spa currently offers, or does it reference generic language that has not been updated since signing?
- Can the medical director produce evidence of chart reviews conducted in the last 90 days?
- Does the compensation structure tie payment to volume or revenue in any way?
- Does the physician have genuine authority to halt a procedure, refuse to delegate, or change a protocol without the business owner's consent?
- Would the arrangement survive scrutiny if a state medical board arrived unannounced and asked to see the director's involvement documentation?
If the answer to any of these is uncertain, the agreement needs revision before the next patient complaint or regulatory inspection forces the question.
Sources
- ByrdAdatto, "Case Study: Non-Compliant Medical Spa Owner and the Corporate Practice of Medicine." https://byrdadatto.com/banter/case-study-non-compliant-med-spa-owner-and-cpom
- Weitzmorgan, "The Med Spa Medical Director Agreement." https://www.weitzmorgan.com/post/the-med-spa-medical-director-agreement
- Nextech, "5 Tips on Hiring a Medical Director for Your Med Spa in 2025." https://www.nextech.com/blog/how-to-find-a-med-spa-medical-director
- Inhouse AI, "Medical Director Agreement Template for Med Spas." https://www.inhouse.ai/med-spa-compliance/medical-director-agreement-template-for-med-spas
- Spencer Fane, "The Legal Facelift: How to Build, Run, and Transition a Compliant Med Spa — Part I." https://www.spencerfane.com/insight/the-legal-facelift-how-to-build-run-and-transition-a-compliant-med-spa-part-i
- Greenbaum Law, "Navigating New Jersey's Medical Spa Regulatory Landscape." https://www.greenbaumlaw.com/insights-alerts-Navigating-New-Jerseys-Medical-Spa-Regulatory-Landscape-Key-Compliance-and-Risk-Management-Considerations.html
- Quarles Law, "Med Spa Compliance Series: Scope of Practice and Supervising Physician Compliance." https://www.quarles.com/newsroom/publications/med-spa-compliance-series-area-of-focus-scope-of-practice-and-supervising-physician-compliance
- Zivian Health, "Corporate Practice of Medicine (CPOM) Guide: California." https://zivianhealth.com/blog/corporate-practice-of-medicine-cpom-guide-california
- Permit Health, "The Corporate Practice of Medicine 50-State Guide." https://www.permithealth.com/post/the-corporate-practice-of-medicine-50-state-guide
- Illinois IDFPR, "Memo Regarding Medical Spa Services," December 2, 2024. https://idfpr.illinois.gov/content/dam/soi/en/web/idfpr/forms/dpr/idfpr-medspa-memo.pdf
- Georgia Composite Medical Board, "FAQs." https://medicalboard.georgia.gov/faqs
- Medical Director Co., "Medical Director Cost for Medspas in 2025." https://www.medicaldirectorco.com/medical-director-cost-medspa
