Top Legal Considerations When Starting a Medical Spa in California

The medical spa (med spa) industry is rapidly growing in California, blending aesthetic treatments and medical procedures to offer services such as Botox, laser treatments, chemical peels, and dermal fillers. However, since medical spas provide treatments that fall under the category of medical procedures, they are subject to strict regulations under California law.

Before launching a medical spa, it’s critical to understand legal requirements, licensing regulations, ownership restrictions, and compliance obligations. Failing to follow these guidelines can result in fines, loss of licenses, and even criminal liability.

This guide covers the top legal considerations when starting a medical spa in California, helping you navigate state laws and ensure a compliant and successful business.

1. Ownership Structure and Corporate Practice of Medicine (CPOM) Compliance

California has strict Corporate Practice of Medicine (CPOM) laws, which prohibit non-physicians from owning or controlling medical practices. Since medical spas offer medical treatments, they must follow these regulations.

Who Can Own a Medical Spa in California?

  • Only licensed physicians (MDs or DOs) can own and operate a medical spa.
  • Non-physicians cannot own a medical spa or employ healthcare providers to perform medical procedures.
  • Nurse practitioners, physician assistants, and registered nurses cannot own a medical spa independently but may work under a licensed physician’s supervision.

Legal Business Structures for Med Spas

To comply with CPOM laws, medical spas are typically structured as:

  • A Professional Medical Corporation owned by a licensed physician.
  • A Management Services Organization (MSO) that handles non-clinical operations, such as billing, marketing, and staffing. The MSO works under a Management Services Agreement (MSA) with the physician-owned corporation.

This MSO model allows business investors or non-physicians to be involved in the administrative side of the med spa while ensuring that all medical decisions remain under the control of licensed physicians.

2. Licensing and Credentialing Requirements

Since medical spas provide medical treatments, various licenses and credentials are required.

Physician Licensing

  • A licensed MD or DO must be the medical director of the medical spa.
  • They must oversee all medical procedures and ensure that staff members operate within their scope of practice.

Business Licenses

  • Obtain a California business license from the local city or county where the med spa will operate.
  • If operating under a Professional Corporation, file with the California Secretary of State.

Medical Board Registration

  • Medical spas must be registered with the Medical Board of California and comply with state medical practice laws.

Staff Credentialing

Ensure that all providers have valid and active California licenses to perform specific procedures:

  • Physicians (MD/DO) – Can perform all medical procedures.
  • Nurse Practitioners (NPs) & Physician Assistants (PAs) – Can perform medical aesthetic treatments under a physician’s supervision.
  • Registered Nurses (RNs) – Can perform injections and laser treatments with a physician’s delegation.
  • Estheticians & Medical Assistants – Cannot perform any medical procedures but can assist with non-medical skincare treatments.

Operating a medical spa without proper licensing can result in severe penalties and loss of medical licenses.

3. Scope of Practice and Supervision Requirements

Medical spa services often require specific supervision levels based on the provider’s license.

Who Can Perform Medical Spa Procedures?

  • Botox & Fillers – Only physicians, nurse practitioners, physician assistants, and RNs (under supervision).
  • Laser Hair Removal & IPL Treatments – Must be performed by an RN, NP, PA, or physician. Estheticians cannot perform laser treatments in California.
  • Chemical Peels & Microneedling – RNs, NPs, and PAs can perform medical-grade treatments, while estheticians can perform mild, cosmetic versions.

Supervision Rules

  • A physician must be available to supervise treatments and handle medical emergencies.
  • RNs and PAs must have written protocols and oversight from a supervising physician.

Improper delegation or allowing unlicensed staff to perform medical treatments can lead to malpractice claims, board investigations, and legal action.

4. Advertising and Marketing Compliance

California enforces strict regulations on medical spa advertising to prevent false or misleading claims.

Advertising Rules for Med Spas

  • Avoid misleading claims – Ads must be truthful and cannot guarantee results.
  • Include physician supervision details – If procedures require a licensed provider, advertising must reflect that they are medically supervised.
  • Use appropriate medical titles – Only licensed physicians can be referred to as “Doctor” in marketing materials.
  • Social media promotions must comply – Influencer endorsements and patient testimonials must be factual and not deceptive.

Violating advertising laws can result in fines from the Medical Board of California and potential legal action.

5. Compliance with HIPAA and Patient Privacy Laws

Medical spas handle sensitive patient information, so they must comply with the Health Insurance Portability and Accountability Act (HIPAA).

Key HIPAA Compliance Requirements

  • Secure patient records – Use encrypted electronic health records (EHR) and prevent unauthorized access.
  • Obtain patient consent – Before sharing before-and-after photos, ensure patients sign HIPAA-compliant consent forms.
  • Train staff on patient confidentiality – Employees must understand privacy laws and proper data handling.

Failure to protect patient privacy can lead to HIPAA violations and hefty fines.

6. Malpractice Insurance and Liability Protection

Why Malpractice Insurance Is Essential

  • Protects medical providers from lawsuits related to injuries, complications, or unsatisfactory results.
  • Covers legal fees in case of malpractice claims.

Types of Insurance to Consider

  • Medical Malpractice Insurance – Covers physicians, NPs, PAs, and RNs.
  • General Liability Insurance – Covers business risks like slips, falls, or non-medical claims.
  • Workers’ Compensation Insurance – Required if you have employees.

Having proper insurance coverage minimizes financial risk in case of legal disputes.

7. Common Legal Mistakes to Avoid When Opening a Medical Spa

  • Allowing non-physicians to own the med spa – Violates CPOM laws.
  • Failing to properly supervise medical treatments – Leads to board investigations and liability claims.
  • Using misleading advertising – Results in regulatory fines.
  • Hiring unlicensed staff to perform medical procedures – Can cause malpractice lawsuits.
  • Not securing malpractice insurance – Leaves providers financially exposed.

By structuring your med spa correctly and following all legal requirements, you can protect your business from lawsuits and regulatory violations.

How We Can Help

At KMSD Law, we specialize in healthcare law and business structuring for medical spas in California. Our legal team can:

  • Help establish a legally compliant med spa structure.
  • Draft Management Services Agreements (MSAs) to separate clinical and business functions.
  • Ensure full compliance with CPOM laws, HIPAA, and advertising regulations.
  • Assist with licensing, credentialing, and corporate formation.
  • Provide ongoing legal support to avoid regulatory violations.

We offer free case consultations and help med spa owners navigate complex California laws.

Contact KMSD Law today to ensure your medical spa operates legally and successfully.