Colorado Management Services Agreement Guide: The Fee Statute's Marketing Exception and Delegation Rule Duties

How to Price the Management Fee

Colorado's fee statute makes dividing fees for sending, bringing or recommending patients, paying anyone for that, and billing in your own name for services rendered by someone else a class 2 misdemeanor and grounds for discipline. It excepts paying an independent advertising or marketing agent, including per-patient or performance-based pay. We found no express ban on percentage-of-revenue MSO fees, and the percentage-of-collections concern comes from vendor commentary. We still use a fixed fee for defined services, and any marketing is a separate, independent vendor arrangement.

What the Practice Must Keep

Section 12-240-138 says lay directors, officers or heirs may not control physicians' independent medical judgment, and Medical Board Rule 1.17 sets the delegation duties the practice keeps: only routine, technical services may be delegated, prescribing is not delegable, the physician monitors quality at least every two weeks, reassesses delegate competence annually and reviews each patient's chart within 14 days, and a medical-aesthetic office must post a notice naming each delegating physician and have patients sign a disclosure.

Terms to Avoid

Avoid giving the MSO any control over medical judgment, any partner, agent, employee or joint venture arrangement with an unlicensed person outside the statutory exceptions, and any payment tied to prescribing a particular drug. Practicing as the partner, agent or employee of an unlicensed person is unprofessional conduct. House Bill 26-1249, which would have let physician assistants own a majority of a med-aesthetic corporation, was postponed indefinitely on March 25, 2026.

Term, Records and Departing Clinicians

SB25-083, effective August 6, 2025 and prospective only, removes the highly compensated worker exception for non-competes and non-solicits that restrict the practice of medicine, advanced practice nursing or dentistry, adds patient-communication protections and caps minority-owner sale-of-business covenants by formula. Our template does not use non-competes for employed clinicians.

Filings, Notices and Watch Items

Colorado's Hospital Transfer Act covers hospitals and listed facilities and does not clearly cover physician practices or MSOs, and broader notice bills died in 2025 and 2026. House Bill 25-1024, effective August 6, 2025, added disclosure duties for physicians and advanced practice nurses delegating medical-aesthetic services to a person who is not a licensed provider, and we did not see its enacted text.

Drafting Checklist

• Fee: fixed for defined services, marketing as a separate independent vendor.
• Judgment: no lay control of physicians' independent medical judgment.
• Delegation: routine, technical services only, with Rule 1.17 oversight.
• Posting: names of delegating physicians and signed disclosures.
• Prescribing: no value from drug makers for prescribing a particular drug.
• Non-competes: none for employed clinicians.

How We Draft It

Patients pay the physician-owned practice, the practice pays the management company a fixed monthly fee under the agreement, and the management company pays MedGrid a fixed monthly retainer for consulting. The management company never practices medicine, and the agreement never moves a clinical decision to it. Our template follows the same flat-fee design in every state, with the state-specific limits below layered on top.

Disclaimer

This article is general educational information, not legal advice. Management agreement rules change and differ by state, and this summary draws on our published state guide, parts of which rest on secondary sources, so have health care counsel in the state review any agreement before you sign.