As healthcare in California continues to evolve, understanding the Corporate Practice of Medicine (CPOM) laws is essential for healthcare providers aiming to maintain compliance and operate legally in 2025. These regulations are designed to preserve the integrity of patient care by ensuring that medical decisions are made by licensed professionals rather than by commercial interests. For medical practitioners, group practices, and telehealth companies, knowing how these laws apply is crucial to success in the Golden State.

California’s CPOM laws in 2025 present unique challenges for healthcare providers. In this comprehensive guide, Access Plus Health breaks down the critical regulations you need to understand in order to ensure compliance and avoid potential legal pitfalls. Whether you're starting a new practice or adjusting an existing one, we help you navigate the complexities of CPOM laws and create a legally sound structure. Trust Access Plus Health to guide you through the process and keep your practice compliant with California’s evolving regulations.

What Are California’s Corporate Practice of Medicine (CPOM) Laws?

The Corporate Practice of Medicine doctrine prohibits non-physicians or non-medical entities from directly owning or controlling a medical practice. In California, only licensed healthcare professionals—especially physicians—can have control over clinical decisions. This regulation is intended to protect patients from potential conflicts of interest where business decisions might influence patient care.

While CPOM regulations are primarily designed to safeguard the doctor-patient relationship, they also have significant implications for medical practices across the state. These laws prevent non-physicians from managing medical decisions, ensuring that healthcare providers remain in control of clinical care, regardless of their business structure.

How CPOM Laws Impact Your Medical Practice

1. Ownership Restrictions:
   
   • CPOM laws limit the ability of non-physicians or corporate entities to own or control a medical practice. Only licensed medical professionals can have a controlling interest in a medical practice in California.
   • Actionable Tip: If you’re considering opening or structuring a practice in California, be mindful that only physicians can hold ownership. Non-physician investors may be involved in the financial aspects but cannot control the clinical side of the practice.
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2. Management Service Organizations (MSOs):
   
   • Non-physicians can, however, manage the administrative functions of a medical practice, such as HR, billing, marketing, and operations, through a management service organization (MSO). MSOs can separate the business side from medical decision-making, allowing physicians to focus on patient care.
   • Actionable Tip: MSOs are a useful structure for non-physician business owners who want to invest in healthcare practices without violating CPOM laws. Consult a healthcare attorney to create a compliant MSO structure.
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3. Telemedicine and CPOM:
   
   • As telemedicine continues to grow, CPOM compliance becomes more complex. Telehealth services must also follow the same regulations regarding physician control over clinical decisions. Non-physician business owners cannot influence the patient-provider interaction in telehealth settings.
   • Actionable Tip: If you're operating a telemedicine business, ensure that physicians have sole responsibility for all clinical decisions. Non-physicians can manage administrative tasks but cannot be involved in medical decision-making.
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4. Risk of Non-Compliance:
   
   • Failing to comply with CPOM regulations can result in significant legal and financial consequences. Penalties may include fines, lawsuits, and the loss of medical licensure.
   • Actionable Tip: Regularly audit your business structure and operations to ensure compliance with CPOM laws. Working with a legal advisor can help prevent costly mistakes.
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California's Corporate Practice of Medicine laws play a pivotal role in shaping how medical practices operate in the state. By ensuring that physicians remain in control of clinical decision-making, CPOM laws protect patient care from corporate influences. For medical providers, understanding these regulations and structuring practices accordingly is vital to staying compliant and ensuring the continued success of their businesses