California med spa ownership rules: who can own a med spa in California
In California, a med spa that offers medical procedures must be owned by a professional medical corporation in which physicians hold at least 51% of the shares. Registered nurses, physician assistants and some other licensed professionals can own the remaining 49% between them, but unlicensed investors cannot own any of the medical practice. The Medical Board of California says plainly that a lay-owned spa that contracts a physician as "medical director" violates the corporate practice ban.
- California has one of the strictest corporate practice of medicine rules in the US, and the Medical Board actively enforces it.
- Corporations Code 13401.5: RNs, PAs and other listed licensees may own shares in a medical corporation, but together no more than 49%.
- The Board lists business decisions only physicians may make: medical records, clinical hiring, payer contracts, coding and billing, equipment and supplies.
- SB 351 (effective January 1, 2026) wrote those limits into statute for private equity and hedge fund investors and lets the Attorney General act against them.
- Practicing under a brand name requires a fictitious name permit from the Medical Board.
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Who can own a med spa in California
Short answer: physicians, through a professional medical corporation in which they own at least 51%. Listed licensees can share the rest. Nobody unlicensed can own any of it.
California's rule comes from statute (Business and Professions Code 2400 and the Medical Practice Act's ban on unlicensed practice) and from decades of court decisions and Medical Board guidance. The Board's position is that corporations, with limited exceptions such as some nonprofit clinics and teaching hospitals, may not practice medicine or employ physicians, whether the physician is called an employee or an independent contractor.
Corporations Code 13401.5 sets out who besides physicians may hold shares in a medical corporation. The list includes registered nurses, physician assistants, licensed psychologists, optometrists, chiropractors, acupuncturists, naturopathic doctors, physical therapists, pharmacists and others. The limit: the shares owned by all of those non-physician licensees combined may not exceed 49% of the total. In practice, that makes three structures common for med spas:
- Physician-owned medical corporation. One or more physicians own all the shares and run the practice.
- Physician-majority corporation with RN, NP or PA shareholders. A common model for nurse injectors who want equity: the physician holds 51% or more, the RN, NP or PA holds the rest.
- Medical corporation plus a management services organization (MSO). A lay founder or investor owns the MSO, which provides space, equipment and non-clinical services. After SB 351, the MSO's role is tightly limited, as covered below.
What California's corporate practice rule covers
Short answer: clinical decisions and the business decisions that shape them. California reads the rule more broadly than most states.
The Medical Board of California lists decisions that must be made by a California-licensed physician, not a lay owner or manager:
- Which diagnostic tests are appropriate, referrals and consultations, and overall responsibility for patient care, including treatment options.
- How many patients a physician must see in a given period.
- Ownership and control of medical records.
- Selecting, hiring and firing clinical staff.
- Contracts with third-party payers, and coding and billing procedures.
- Approval of medical equipment and supplies.
The same Board page lists arrangements it treats as prohibited, including non-physicians owning or operating a business that offers patient evaluation, diagnosis, care or treatment; management services organizations that exercise control over physician practices; and physicians acting as "medical director" of a practice they do not own. It names med spas directly, using Botox injections, laser hair removal and medical microdermabrasion as examples of medical procedures.
SB 351 and investor-backed med spas
Governor Newsom signed SB 351 on October 6, 2025, and it took effect January 1, 2026. It applies to private equity groups and hedge funds involved with physician and dental practices. It bars them from interfering with professional judgment, reserves the decisions listed above to physicians, and gives the Attorney General power to seek injunctive relief and attorney's fees against investors. Private equity can still own a management company that provides non-clinical services. If your med spa has institutional investors, have counsel review the management agreement against SB 351.
Supervision, delegation and good-faith exam requirements are covered in our med spa medical director requirements guide.
California med spa registration checklist
- Engage a California healthcare lawyer before signing a lease. Decide the shareholder mix (physician majority, optional RN, NP or PA minority) and whether an MSO is involved.
- Form a professional medical corporation with the California Secretary of State. Not an LLC: the Medical Board lists LLCs and LLPs among prohibited structures for physicians.
- Apply for a fictitious name permit from the Medical Board if the practice will use a brand name (Business and Professions Code 2415). The Board needs the articles showing professional medical corporation status, and processing has run about four to six weeks.
- Draft the management services agreement (if any) so the MSO handles only non-clinical services and has no say in records, clinical hiring, coding, billing decisions or equipment selection.
- Verify licenses and scope for every physician, PA, NP, RN and esthetician, and put supervision and standardized procedures in writing.
- Set up drug sourcing and records. Buy prescription products only from authorized sources; the FDA's 2024 alert on counterfeit Botox is the reason to document every lot. Register with the DEA for any controlled substance.
- Local permits and taxes. City business license, seller's permit for retail products, and any county requirements.
- Privacy. HIPAA policies and Business Associate Agreements with vendors, plus California privacy law obligations your lawyer identifies.
What ownership means for California med spa marketing
Short answer: the name on your ads must be one the Medical Board has approved, and nothing in your marketing should suggest the management company is the provider.
- Brand name = permitted name. The name in your Google Business Profile, ads and website should match the fictitious name permit. A name the Board considers misleading will not be approved in the first place.
- Name the physicians and providers. Identify the medical corporation and the physicians responsible, and describe accurately who performs injections and laser treatments.
- Advertising rules. California has its own healthcare advertising requirements; see our California medical board advertising rules guide. For images, see the before-and-after photo compliance guide.
- Memberships and auto-renewals. California's automatic renewal law affects membership plans; our membership terms of service guide covers it.
For market context, see our California med spa market report, the Med Spa Google Presence Report 2026 and our med spa marketing statistics. For hands-on help, see med spa marketing with Ichelon Consulting US.
What we found when we studied 555 US med spas on Google
Patients praise the care almost without exception. The one area where complaints outnumber praise is booking and communication, and that is where most med spas can win.
Full study · 555 US med spas across 20 metros · roughly ±4% nationally · review velocity and themes from a 115-spa subsample · verified against raw data.
Common California med spa ownership mistakes
- The lay-owned spa with a contracted medical director. The Medical Board's own example of a violation.
- Forming an LLC for the medical practice. A standard LLC filing from an online service is the wrong entity.
- Giving an RN or PA 50% or more. Non-physician licensees together are capped at 49%.
- An MSO that decides coding, clinical hiring or equipment. Those are physician decisions under Board guidance and, for PE and hedge fund investors, under SB 351.
- Advertising under an unpermitted brand name. Using an assumed name without a fictitious name permit is unprofessional conduct.
- Copying an out-of-state model. Structures that work in Florida or Arizona do not work here.
Not legal advice: this page summarizes California rules as we found them in October 2026. It is not legal advice. Confirm your structure with a California healthcare attorney.
Sources
- Medical Board of California: corporate practice of medicine
- California Corporations Code 13401.5
- California Business and Professions Code 2400
- California Business and Professions Code 2415 (fictitious name permits)
- Medical Board of California: fictitious name permit
- FDA: counterfeit version of Botox found in multiple states
- American Med Spa Association: med spa ownership
- Epstein Becker Green: California governor signs SB 351
- Foley & Lardner: California SB 351 signed
Related: ownership rules in all 50 states + DC · all US guides · book a call.
Related pages from the US team
Med spa ownership rules by state
The pillar guide with a 50-state + DC table.
Arizona med spa ownership rules
Why some California operators look east.
Texas med spa ownership rules
Another strict state, with different details.
California med spa market 2026
Our research on California med spas on Google.
California medical board advertising rules
How California regulates healthcare advertising.
Med spa marketing in Beverly Hills
Local marketing for Los Angeles-area med spas.
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Common questions
Can a non-physician own a med spa in California?
Not the medical practice. Unlicensed people may not own any part of a medical corporation. Registered nurses, nurse practitioners (who are registered nurses), physician assistants and other licensees listed in Corporations Code 13401.5 may own minority shares, up to 49% combined. A non-licensee can own a management company that provides non-clinical services, within the limits the Medical Board and SB 351 set.
Can a nurse practitioner or PA own a med spa in California?
As a minority shareholder of a physician-majority medical corporation, yes. Corporations Code 13401.5 allows registered nurses and physician assistants, among others, to hold shares as long as all non-physician licensee shares together do not exceed 49%. An NP or PA cannot own the majority of a medical corporation.
Is a medical director arrangement legal for a California med spa?
Not if the spa is owned by non-physicians. The Medical Board of California uses spas that offer Botox injections, laser hair removal and medical microdermabrasion as its example: contracting a physician as medical director does not cure lay ownership. A physician may not act as a medical director of a practice they do not own.
What does California SB 351 do?
Signed on October 6, 2025 and effective January 1, 2026, SB 351 bars private equity groups and hedge funds involved with physician practices from interfering with professional judgment and reserves decisions such as medical records, clinical hiring, payer contracts, billing and coding, and equipment selection to physicians. It lets the Attorney General seek injunctions and fees from investors, not only from physicians.
Can a California medical practice be an LLC?
No. The Medical Board of California lists physicians operating through LLCs, limited liability partnerships or general corporations among prohibited structures. Medical practices use a professional medical corporation.
Does a California med spa need a fictitious name permit?
If the practice operates under any name other than the physician owners' own names, yes. Business and Professions Code 2415 requires a fictitious name permit from the Medical Board, and using an assumed name without one is unprofessional conduct under section 2285. The Board reviews the name and will not approve one that is misleading.
A note on this guide: it explains marketing practice, not legal advice. Rules on privacy, advertising and insurance change and vary by state, so confirm anything compliance-related with your own counsel.
Marketing a California med spa?
Book a 30-minute call with a member of our Sr. Leadership team. We will review your Google presence, ads and booking flow, and flag anything that conflicts with California advertising rules.