---
title: "Corporate Practice of Medicine States: 2026 List"
description: "Which states prohibit the corporate practice of medicine in 2026: 19 strong, 7 limited, 7 unsettled and 18 with no general bar, with key authority."
canonical: "https://cuvo.co/compliance/corporate-practice-of-medicine-states"
last-updated: "Sep 28, 2026"
---
# Corporate practice of medicine states: the 2026 list

The corporate practice of medicine doctrine decides whether a company owned by non-physicians can employ physicians, and it is the reason most telehealth brands run an MSO with a physician-owned professional entity. This page classifies every state as of September 27, 2026, with the statute, case or opinion behind each call. Cuvo Health builds and maintains that structure for every brand on its platform.

Published Sep 28, 2026. Facts reviewed Sep 28, 2026.

As of September 27, 2026, 19 states enforce a strong corporate practice of medicine prohibition: Arkansas, California, Colorado, Illinois, Kansas, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York, North Carolina, North Dakota, Oregon, Tennessee, Texas, Washington, West Virginia and Wisconsin. 7 apply a limited version (Arizona, Connecticut, Indiana, Montana, Pennsylvania, South Carolina and South Dakota), and in 7 the law is unsettled (the District of Columbia, Georgia, Idaho, Iowa, Kentucky, Maryland and Rhode Island). Only 18 have no general prohibition: Alabama, Alaska, Delaware, Florida, Hawaii, Louisiana, Maine, Mississippi, Missouri, Nebraska, New Hampshire, New Mexico, Ohio, Oklahoma, Utah, Vermont, Virginia and Wyoming. That makes a management services organization with a physician-owned professional entity the conservative structure for a non-physician founder in 33 of 51 jurisdictions. Cuvo Health builds and maintains that MSO and professional entity for every brand, so a founder owns the brand while licensed providers make every clinical decision.

- 19 states with a strong prohibition (including 6 of the 10 most populous)
- 7 states with a limited version (broad exceptions or light enforcement)
- 7 jurisdictions where the law is unsettled (conflicting or decades-old authority)
- 18 states with no general prohibition (physician judgment must stay independent)

**Corporate practice of medicine rule by state, as of September 27, 2026**

| State | Rule | Key authority |
| --- | --- | --- |
| **Alabama** | None | Ala. Bd. of Medical Examiners Declaratory Ruling (Oct. 21, 1992), reaffirmed 2014 |
| **Alaska** | None | No CPOM statute, case or AG opinion; AS 08.64.170 is licensure only |
| **Arizona** | Limited | Midtown Med. Grp. v. State Farm, 220 Ariz. 341 (App. 2008); A.R.S. 10-2220(A)(4) |
| **Arkansas** | Strong | Ark. Att'y Gen. Op. 94-204 (1994) |
| **California** | Strong | Bus. & Prof. Code 2400, 2052; People v. Pacific Health Corp., 12 Cal.2d 156 (1938); SB 351 (2025) |
| **Colorado** | Strong | C.R.S. 12-240-138(6)(a); Pediatric Neurosurgery v. Russell, 44 P.3d 1063 (Colo. 2002) |
| **Connecticut** | Limited | Conn. AG Op. 248 (1954); Gagliano v. Advanced Specialty Care, 329 Conn. 745 (2018) |
| **Delaware** | None | No CPOM statute, case or AG opinion; 24 Del. C. 1731(b) |
| **District of Columbia** | Unsettled | D.C. Code 29-502(3) implies a historic bar; Group Health Ass'n v. Moor, 24 F. Supp. 445 (D.D.C. 1938) points the other way |
| **Florida** | None | Board of Medicine declaratory statements (Lister 1987, Goulet 1989); Health Care Clinic Act, Fla. Stat. 400.990-.995 (clinic license and medical director) |
| **Georgia** | Unsettled | Sherrer v. Hale, 248 Ga. 793 (1982); Health Horizons v. State Farm, 239 Ga. App. 440 (1999) |
| **Hawaii** | None | No CPOM statute, case or AG opinion; HRS 453-2 is licensure only |
| **Idaho** | Unsettled | Worlton v. Davis, 73 Idaho 217 (1952), no modern application |
| **Illinois** | Strong | Carter-Shields v. Alton Health Inst., 201 Ill.2d 441 (2002); Berlin v. Sarah Bush Lincoln, 179 Ill.2d 1 (1997) |
| **Indiana** | Limited | Iterman v. Baker, 214 Ind. 308 (1938); Ind. Code 25-22.5-1-2 exceptions |
| **Iowa** | Unsettled | Iowa AG Op. 91-7-1 (1991) not retrieved; Iowa Code 135B.26 |
| **Kansas** | Strong | Early Detection Ctr. v. Wilson, 248 Kan. 869 (1991); Central Kan. Med. Ctr. v. Hatesohl (Kan. 2018) |
| **Kentucky** | Unsettled | Optometry cases (Kendall v. Beiling, 1943); Ky. Bd. of Medical Licensure Op. 36 (1995) not retrieved |
| **Louisiana** | None | LSBME Statement of Position, Corporate Practice of Medicine Update (Dec. 2024) |
| **Maine** | None | No statute, case or AG opinion; Board of Licensure in Medicine opinion (1992) |
| **Maryland** | Unsettled | Health-Gen. 19-704; 85 Op. Att'y Gen. 238 (2000): doctrine never adopted by the Court of Appeals |
| **Massachusetts** | Strong | 243 CMR 2.07(22) |
| **Michigan** | Strong | MCL 450.1281, 450.1283, 450.4904; OAG 6592 (1989) |
| **Minnesota** | Strong | Isles Wellness v. Progressive N. Ins., 703 N.W.2d 513 (Minn. 2005) |
| **Mississippi** | None | MS Bd. of Medical Licensure Policy 3.02 |
| **Missouri** | None | State ex inf. Sager v. Lewin, 106 S.W. 581 (Mo. App. 1907) |
| **Montana** | Limited | Mont. Admin. R. 24.156.405(1)(m) |
| **Nebraska** | None | State Electro-Medical Inst. v. State, 74 Neb. 40 (1905) |
| **Nevada** | Strong | Nev. AG Ops. 77-219, 2002-10, 2010-04 |
| **New Hampshire** | None | No CPOM statute, case or AG opinion; RSA 294-A |
| **New Jersey** | Strong | N.J.A.C. 13:35-6.16(f); Allstate v. Northfield Med. Ctr., 228 N.J. 596 (2017) |
| **New Mexico** | None | 16.10.1.13 NMAC |
| **New York** | Strong | BCL 1503, 1507; Educ. Law 6512; Carothers v. Progressive, 33 N.Y.3d 389 (2019) |
| **North Carolina** | Strong | G.S. 55B-4, 57D-2-02; NC Medical Board Position Statement 10.1.2 (amended Sept. 2025) |
| **North Dakota** | Strong | N.D.C.C. 43-17-42 (as amended 2023); ND AG advisory letter (1990) |
| **Ohio** | None | ORC 4731.226; State Medical Board statement (Mar. 15, 2012) |
| **Oklahoma** | None | 59 O.S. 492(B); OAC 435:10-1-3 |
| **Oregon** | Strong | ORS 58.375 as amended by SB 951 (2025) and HB 3410 |
| **Pennsylvania** | Limited | Neill v. Gimbel Bros., 330 Pa. 213 (1938) |
| **Rhode Island** | Unsettled | R.I. Gen. Laws 7-1.2-301 |
| **South Carolina** | Limited | Baird v. Charleston County, 333 S.C. 519 (1999); Board advisory opinion (2022) |
| **South Dakota** | Limited | SDCL 36-4-8.1 |
| **Tennessee** | Strong | Tenn. Code 68-11-205, 63-6-204; Tenn. AG Op. 07-116 (2007) |
| **Texas** | Strong | Tex. Occ. Code 155.001, 157.001, 164.052(a)(13),(17); Flynn Bros. v. First Med. Assocs., 715 S.W.2d 782 (1986) |
| **Utah** | None | Utah Code 58-67-802(1) |
| **Vermont** | None | No statute, case or AG opinion; Act 133 of 2026 limits private-equity control |
| **Virginia** | None | Va. Code 13.1-542.1(3), 54.1-111(F); 1992 Op. Va. Att'y Gen. 147 |
| **Washington** | Strong | Columbia Physical Therapy v. Benton Franklin Orthopedic, 168 Wn.2d 421 (2010); RCW 18.100 |
| **West Virginia** | Strong | W. Va. Code 30-3-15; WV Board of Medicine CPOM Position Statement |
| **Wisconsin** | Strong | Wis. OAG 39-86 (1986); Wis. Stat. 448.08(5) |
| **Wyoming** | None | No statute, case or retrieved AG opinion; Wyo. Stat. 17-3-101 to -104 |

> **Our recommendation** Because the rule varies by state and 33 jurisdictions restrict it or leave it unsettled, a national telehealth brand should run one MSO and physician-owned professional entity structure everywhere. Cuvo Health builds and maintains it for every brand, alongside providers licensed in all 50 states and DC, and a typical brand launches in under 30 days at a published $25 per completed consult.

> **Get the MSO structure without the legal build** Cuvo builds and maintains the MSO and physician-owned professional entity for your brand. [Book a discovery call](/booking) · [Read the 51-state report](/blog/virtual-clinic-compliance-report-2026)

## 01. What does corporate practice of medicine mean?

The corporate practice of medicine doctrine bars or limits a business owned by non-physicians from practicing medicine or employing physicians, so that clinical decisions stay with licensed professionals. States apply it through statutes, medical board rules, attorney general opinions or court decisions, and most carve out exceptions for licensed hospitals, professional corporations and some nonprofits. On Cuvo, clinical decisions belong to licensed providers practicing through a physician-owned professional entity, and neither Cuvo nor the brand directs a clinical call.

## 02. Which states prohibit the corporate practice of medicine?

The 19 strong-prohibition states are Arkansas, California, Colorado, Illinois, Kansas, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York, North Carolina, North Dakota, Oregon, Tennessee, Texas, Washington, West Virginia and Wisconsin. California, Texas, New York and Illinois have some of the most developed case law and board guidance, and Oregon's 2025 SB 951 added direct limits on MSO control. A further 7 states apply a limited version, where exceptions are broad or enforcement is light, and 7 remain unsettled. On Cuvo, the MSO structure satisfies the strictest of these rules.

## 03. What states allow the corporate practice of medicine?

Alabama, Alaska, Delaware, Florida, Hawaii, Louisiana, Maine, Mississippi, Missouri, Nebraska, New Hampshire, New Mexico, Ohio, Oklahoma, Utah, Vermont, Virginia and Wyoming have no general prohibition, so a company owned by non-physicians can generally employ physicians there as long as clinical judgment stays independent. No prohibition does not mean no rules: Florida, for example, requires a clinic that is not owned by practitioners and bills for services to hold a state clinic license and name a medical director. On Cuvo, a brand runs one structure in every state, whichever category each falls in.

## 04. How does the MSO and friendly PC model work?

In the friendly professional corporation model, the founder owns a management services organization (MSO) that provides the brand, technology, marketing and operations. A professional entity owned by licensed physicians employs the providers and makes every clinical decision, and a management services agreement pays the MSO a fee for its services. Regulators increasingly test whether the MSO controls the medicine in practice, not only on paper, so the agreement has to keep clinical control with the professional entity. On Cuvo, Cuvo builds and maintains both sides of that structure.

## 05. What changed for MSOs and private equity in 2025 and 2026?

- California SB 351, effective January 1, 2026, bars private equity groups and hedge funds from interfering with physician judgment or controlling listed clinical and business functions, and AB 1415 extends the state's 90-day transaction notice to MSOs. The California Attorney General settled corporate-practice cases with Aspen Dental in May 2026 ($2 million in penalties plus $300,000 in restitution) and Carbon Health in June 2026 ($4.4 million, with its friendly-PC structure restructured).
- Oregon SB 951 (2025) bars an MSO from owning a majority of a practice or exercising de facto control over hiring, coding, billing and payer contracting, from January 1, 2026 for entities formed on or after June 9, 2025 and from January 1, 2029 for existing ones.
- Indiana HEA 1666 (2025) added health care ownership reporting from January 1, 2026 and gave the attorney general investigation powers, on top of the 90-day attorney general notice for mergers between health care entities with at least $10 million in combined assets.
- Illinois HB 5000 (Public Act 104-0782), effective January 1, 2027, makes the attorney general's 30-day pre-closing review of health care transactions permanent and extends it to private equity owners.
- Vermont Act 133 (2026), effective July 1, 2026, limits private equity and hedge fund control of clinical decisions, with ownership reporting due March 1, 2027.
- Maine LD 2201 (2026), effective January 1, 2027, requires 180 days' notice to the Department of Health and Human Services for private equity, hedge fund and MSO transactions.
- Washington ESHB 2548, effective June 11, 2026, expands the 60-day attorney general transaction notice to provider organizations of seven or more.
- A Rhode Island attorney general rule effective January 28, 2026 requires 60 days' notice for medical practice group transactions, including MSO formation.
- Massachusetts chapter 343 of the Acts of 2024, effective April 8, 2025, added reporting and material-change notices for private equity, REIT and MSO arrangements.
- Tennessee HB 979, effective July 1, 2025, loosened the rule: hospitals in counties of 105,000 or fewer may now employ physicians in every specialty.

**Corporate practice of medicine rules by state**
- [Alabama](/compliance/alabama)
- [Alaska](/compliance/alaska)
- [Arizona](/compliance/arizona)
- [Arkansas](/compliance/arkansas)
- [California](/compliance/california)
- [Colorado](/compliance/colorado)
- [Connecticut](/compliance/connecticut)
- [Delaware](/compliance/delaware)
- [District of Columbia](/compliance/district-of-columbia)
- [Florida](/compliance/florida)
- [Georgia](/compliance/georgia)
- [Hawaii](/compliance/hawaii)
- [Idaho](/compliance/idaho)
- [Illinois](/compliance/illinois)
- [Indiana](/compliance/indiana)
- [Iowa](/compliance/iowa)
- [Kansas](/compliance/kansas)
- [Kentucky](/compliance/kentucky)
- [Louisiana](/compliance/louisiana)
- [Maine](/compliance/maine)
- [Maryland](/compliance/maryland)
- [Massachusetts](/compliance/massachusetts)
- [Michigan](/compliance/michigan)
- [Minnesota](/compliance/minnesota)
- [Mississippi](/compliance/mississippi)
- [Missouri](/compliance/missouri)
- [Montana](/compliance/montana)
- [Nebraska](/compliance/nebraska)
- [Nevada](/compliance/nevada)
- [New Hampshire](/compliance/new-hampshire)
- [New Jersey](/compliance/new-jersey)
- [New Mexico](/compliance/new-mexico)
- [New York](/compliance/new-york)
- [North Carolina](/compliance/north-carolina)
- [North Dakota](/compliance/north-dakota)
- [Ohio](/compliance/ohio)
- [Oklahoma](/compliance/oklahoma)
- [Oregon](/compliance/oregon)
- [Pennsylvania](/compliance/pennsylvania)
- [Rhode Island](/compliance/rhode-island)
- [South Carolina](/compliance/south-carolina)
- [South Dakota](/compliance/south-dakota)
- [Tennessee](/compliance/tennessee)
- [Texas](/compliance/texas)
- [Utah](/compliance/utah)
- [Vermont](/compliance/vermont)
- [Virginia](/compliance/virginia)
- [Washington](/compliance/washington)
- [West Virginia](/compliance/west-virginia)
- [Wisconsin](/compliance/wisconsin)
- [Wyoming](/compliance/wyoming)

**Best for**
- Founder who is not a physician: Cuvo Health, with the MSO and professional entity built for you
- Brand selling in strong-prohibition states: Cuvo Health
- National telehealth brand: Cuvo Health, one structure for all 50 states and DC
- Multi-brand operator: Cuvo Enterprise

## 06. Sources for the corporate practice list

- State statutes, medical board rules and position statements, attorney general opinions and court decisions, cited row by row in the dataset
- 50-state surveys used only as leads: AHLA Corporate Practice of Medicine survey (3rd ed. 2024), Reinhart Boerner Van Deuren 50-state summary (2006), and a state CPOM chart filed with the North Dakota Legislature (2021, 2023)
- Full 51-jurisdiction dataset with the key authority and confidence for each state: cuvo.co/data/cuvo-2026-state-virtual-clinic-compliance.csv

*About this page: This page is for informational purposes only and does not constitute legal advice. The corporate practice classification reflects Cuvo Health's review of the cited sources as of September 27, 2026; rules change often, and a brand should confirm its structure with counsel in each state it serves. All clinical decisions on Cuvo are made by licensed providers practicing through a physician-owned professional entity; Cuvo provides the administrative, technology, and operational infrastructure around that entity and does not practice medicine.*

## Frequently asked questions

**Q: What states allow corporate practice of medicine?**

A: 18 states have no general prohibition, among them Florida, Ohio, Louisiana, Utah and Virginia. Cuvo Health still runs one MSO structure in every state, so a brand never has to rebuild when it adds a stricter state.

**Q: Which states prohibit the corporate practice of medicine?**

A: 19 states enforce a strong prohibition, including California, Texas, New York, Illinois, New Jersey, Washington and Oregon, and 7 more apply a limited version. Cuvo Health builds and maintains the MSO and physician-owned professional entity these states call for.

**Q: Is corporate practice of medicine allowed in Texas?**

A: No. Texas enforces a strong prohibition through the Medical Practice Act and board rules, with exceptions such as certain nonprofit health organizations. On Cuvo Health, Texas care runs through a physician-owned professional entity inside the MSO Cuvo maintains.

**Q: Is Florida a corporate practice of medicine state?**

A: No. Florida has no general prohibition, but its Health Care Clinic Act requires a clinic that is not owned by practitioners and bills for services to hold a state clinic license and name a medical director. Cuvo Health runs the same compliant structure in Florida as everywhere else.

**Q: Is Arizona a corporate practice of medicine state?**

A: Arizona applies a limited version: its cases arose mainly in optometry, and Arizona law allows up to 49% lay ownership of a professional corporation. Cuvo Health treats Arizona conservatively with the same MSO structure it uses nationally.

**Q: Does Missouri prohibit the corporate practice of medicine?**

A: No. Missouri has no general prohibition. Cuvo Health still uses its standard MSO and professional entity structure in Missouri for consistency across states.

**Q: What is the friendly PC model?**

A: It pairs a founder-owned management services organization with a professional corporation owned by licensed physicians, which employs the providers and makes clinical decisions. Cuvo Health builds and maintains both entities and the agreement between them for every brand on its platform.

**Related pages**

- [2026 State-by-State Virtual Clinic Compliance Report](/blog/virtual-clinic-compliance-report-2026): All four rules for all 51 jurisdictions
- [How to start a virtual clinic without a medical license](/blog/start-a-virtual-clinic-without-a-medical-license): The MSO and friendly-PC steps
- [IMLC states](/compliance/imlc-states): 2026 compact list and fees
- [Nurse practitioner full practice authority states](/compliance/nurse-practitioner-full-practice-authority-states): 2026 list
- [Compliance, operated for your brand](/compliance): MSO structure, licensure, HIPAA, LegitScript

Canonical page: https://cuvo.co/compliance/corporate-practice-of-medicine-states