Launching a Michigan Medical Spa - Common Legal and Structural Considerations

Overview

Michigan’s medical spa market continues to grow as consumer demand for aesthetic services increases. Treatments such as injectables, lasers, and other cosmetic procedures attract physicians and non-physician entrepreneurs alike. At the same time, medical spas operate within the healthcare regulatory framework, not the wellness or retail space. That distinction shapes how these businesses are structured and operated.

This post provides general educational information about legal and regulatory issues that commonly arise when launching a medical spa in Michigan. It is not legal advice and does not create an attorney client relationship. Every medical spa has its own ownership structure, services, staffing model, and risk tolerance. These considerations are typically evaluated with legal and compliance advisors before a clinic begins operations.

Corporate Practice of Medicine and Business Structure

Michigan regulates who may own and control the practice of medicine through its professional entity laws. Medical services are generally provided through a professional corporation or professional limited liability company owned by licensed physicians. Non-physicians typically cannot own or control the clinical practice itself.

Because of these restrictions, many Michigan medical spas operate using a management services organization structure. In this model, a physician-owned professional entity provides medical services, while a separate MSO provides non-clinical support such as space, staffing, equipment, marketing, and administrative services. This structure is common, but it requires clear separation between clinical decision making and business operations.

Financial arrangements between the MSO and the professional entity also raise compliance considerations. Michigan law restricts fee splitting and improper financial incentives in healthcare. As a result, MSO compensation is often structured at fair market value rather than as a share of medical revenue. Governance boundaries also matter, as physicians generally retain authority over clinical supervision, protocols, and medical judgment.

Physician Involvement and Clinical Oversight

Medical spas rely on physician involvement even when physicians are not present onsite daily. Michigan law governs how physicians supervise delegated medical acts, including cosmetic procedures performed by nurses and other clinical staff. Supervision commonly involves availability for consultation, protocol development, and periodic review rather than continuous physical presence.

Medical spas often involve a mix of physicians, physician assistants, nurse practitioners, and registered nurses. Each role carries different scope of practice rules and supervision requirements. Physician assistants typically practice under written agreements with physicians. Nurse practitioners may practice with a greater degree of independence, depending on the services provided. Registered nurses perform delegated acts under physician supervision and do not independently diagnose or prescribe.

Many medical spas incorporate a good faith exam into patient intake, particularly for injectable or prescription-based treatments. These exams are typically performed by a physician, physician assistant, or nurse practitioner. Clinics that rely heavily on nursing staff often structure prescriber relationships carefully to address this requirement.

Facilities and Day to Day Operations

Medical spas in Michigan are often structured as physician offices rather than licensed healthcare facilities, but that classification does not eliminate facility‑level regulatory considerations. How a clinic operates day to day can affect which additional rules apply, particularly as services expand beyond strictly medical treatments.

Local zoning and business licensing requirements frequently influence where a medical spa may operate and how space is configured. Municipalities may treat medical spas differently from retail or personal service businesses, which can affect permitted uses, signage, and occupancy requirements.

Some medical spas offer services that fall outside the practice of medicine, such as non‑medical cosmetology or aesthetic services. When those services are provided, separate licensing considerations may apply under Michigan’s cosmetology laws, even if the business otherwise functions as a medical practice. Whether cosmetology establishment licensure is implicated depends on the nature of the services offered and how they are delivered within the clinic.

Prescription drug handling is another area that often receives attention in medical spa planning. Clinics that store, dispense, or administer prescription medications often raise questions under Michigan’s pharmacy and drug control laws, even when operating as a physician office rather than a retail pharmacy. These rules generally address how drugs are acquired, stored, secured, documented, and made available within a practice. How and whether these requirements apply depends on the medications involved and the manner in which the clinic operates, and they are commonly evaluated as part of broader compliance planning.

Operational planning also commonly accounts for medical waste obligations. Medical spas that generate sharps or other regulated medical waste may fall within Michigan’s medical waste regulatory framework. These requirements generally focus on safe handling, storage, and disposal practices and can apply regardless of the size of the practice or whether services are provided on a cash‑pay basis.

Workplace safety and infection control considerations also play a role in early planning. Clinics frequently evaluate how bloodborne pathogen standards, sharps handling practices, and hazard communication rules apply to their staff and physical space. Many medical spas align internal policies with recognized outpatient infection control guidance as part of risk management and professionalism.

Mobile services, pop‑up events, or offsite treatments can introduce additional complexity. Clinics that offer services outside a fixed location often evaluate how supervision, drug handling, waste handling, privacy, and documentation obligations apply in those settings, even when the underlying services are the same.

Privacy and Confidentiality Considerations

Privacy obligations depend in part on how a medical spa operates. HIPAA generally applies when a practice conducts certain electronic transactions, such as billing insurance. Many medical spas operate on a cash-pay basis and may not qualify as HIPAA covered entities. Even in those cases, Michigan confidentiality laws still apply, and many clinics adopt HIPAA-based practices as a matter of risk management and professionalism.

Advertising and Marketing Risk

Marketing is a frequent source of regulatory scrutiny for medical spas. Michigan law prohibits misleading or deceptive advertising, and physicians may face professional discipline for false or unsubstantiated claims. Consumer protection laws also apply to promotional statements and pricing practices.

Claims about results, safety, or permanence of aesthetic treatments often receive heightened scrutiny. Marketing that implies guaranteed outcomes or minimizes medical risk can create liability exposure. Clinics typically evaluate marketing language carefully, particularly where physician credentials, titles, or endorsements appear in advertising.

Staffing, Insurance, and Practical Business Issues

Staffing models influence both compliance and cost. Medical spas often employ or contract with nurses and advanced practice providers while relying on physicians for supervision and prescribing. These relationships affect scheduling, compensation, and liability allocation.

Insurance planning is a key consideration. Medical malpractice coverage typically applies to the physician entity and clinical staff, while the MSO may require separate business coverage. Premiums and coverage terms vary based on services offered and provider mix, and these costs often factor into early financial planning.

Banking and financial operations also tend to reflect the two-entity structure. Professional entities and MSOs usually maintain separate accounts and records, which can require coordination between physician owners and business operators.

Closing Thoughts

Launching a medical spa in Michigan involves more than branding and equipment selection. Corporate practice restrictions, supervision and delegation rules, advertising standards, and workplace compliance requirements all shape how these businesses are structured and operated.

This post is intended to provide a general overview of common legal and regulatory considerations for medical spas in Michigan. It is not a substitute for advice tailored to a specific business model or clinical offering. Physicians and entrepreneurs entering this space often benefit from early planning that accounts for both compliance obligations and long-term operational goals.

Mooradian Law works with licensed practitioners, entrepreneurs, and investors to structure compliant medical spa arrangements and supporting agreements. If you are considering launching a medical spa in Michigan, we welcome the opportunity to discuss how these considerations may apply to your proposed business.