Louisiana Practice Structure Guide: The Professional Medical Corporation and the Board's December 2024 Corporate Practice Statement

Entity and Ownership

Louisiana's Professional Medical Corporations Act lets licensed physicians or podiatrists form a corporation to practice medicine. The name may be shareholders' names or another name approved by the Secretary of State ending in A Professional Medical Corporation, A Professional Corporation or A Medical Corporation. The corporation may engage in no business other than practicing medicine, though it may hold property for investment or in connection with practice. There is one class of common shares, and only a licensed Louisiana physician holding in their own right, or another professional medical corporation, may vote and participate in earnings. Any other holder has no voting rights, no share of earnings and no access to records or communications about medical services. Only voting shareholders may be directors or officers, only licensed natural persons may render medical services, and these corporations may merge only with each other. A July 2025 Attorney General opinion, which we saw only through a summary site, says a professional medical corporation may not convert to an LLC while it continues to practice medicine. We found no statute authorizing a medical professional LLC, and no Board filing requirement.

The Corporate Practice Position

The Board of Medical Examiners' Statement of Position on corporate practice, updated in December 2024, says a physician's employment by a non-professional corporation is not per se unlawful under the Medical Practice Act and that management must not infringe on the physician's medical judgment or clinical decisions. A corporation that controls and directs the manner in which a physician provides medical services would be considered by the Board to be engaging in the unauthorized practice of medicine, exposing it to injunction and criminal prosecution and the physician to discipline. The Board says termination of employment, ownership of and access to medical records and various compensation arrangements may well be considered legally problematical, to be handled case by case. A companion 2015 statement says its non-per-se view was predicated on arrangements that give a departing physician access to records and patients freedom of choice. A 2025 Senate resolution asks Congress to examine corporate practice, and we found no Louisiana appellate decision or published enforcement against an MSO.

The Management Agreement and Fees

The medical practice act makes it a ground for discipline to solicit, accept or receive anything of economic value in return for and based on referring patients or prescribing medications or devices, and to assist an unlicensed person to practice or lend one's name to an illegal practitioner. A separate statute bars health care providers from paying or receiving payment for referring or soliciting patients, with return on investment based on ownership percentage not counted as payment. We found no general fee-splitting ground and no specific Board rule on percentage management fees, though the Board's corporate practice statement flags compensation arrangements. A Board rule, as quoted in its IV statement, bars a physician from any arrangement as medical director or otherwise that condones unlicensed practice without the physician's direction and immediate personal supervision.

A 2024 law effective in 2025 limits physician non-competes: primary care physicians may not be bound more than three years from the initial contract and later contracts cannot contain them, other physicians five years, and after early termination the restraint is limited to the principal parish plus two contiguous parishes for two years, with exemptions for rural hospital and rural federally qualified health center physicians. We found no provider transaction notice law.

Med Spa, IV and Peptide Rules

Louisiana has no med spa statute, and a 2020 med spa bill with a medical director requirement was withdrawn. The Board's Statement of Position on lasers and chemical skin treatments, revised in 2001, says non-physicians must work under direct supervision, meaning the physician is physically present on the premises and immediately available whenever the non-physician is on duty, after a physician exam, diagnosis and informed consent. Its footnote extends the position to any light source, injection or insertion of substances or soft tissue augmentation, and the Board criticizes medical directors who serve in title but not in physical presence for non-physician-owned businesses. It is the strictest supervision statement in this series, and we could not confirm whether the Board has softened it. The Board's August 2024 retail IV statement calls standing orders inappropriate and unlawful and limits diagnosis and recommendation of IV therapy to physicians and the PAs, nurse practitioners and midwives working with them. A 2026 law effective August 1 bars licensing boards from prohibiting prescribers from providing peptides shipped from an FDA-registered 503B facility or compliant 503A pharmacy, which does not authorize research-grade product.

How We Structure It

As a rule we set up a professional medical corporation owned by the licensed physician, with no exceptions for what looks like a more flexible state. Patients pay the physician-owned practice. The practice pays the management company a fixed monthly fee under a written management services agreement. The management company pays MedGrid a fixed monthly retainer for consulting. The MSO never practices medicine, and the physician makes every clinical decision. In Louisiana the physician is physically on the premises when non-physicians treat, the agreement protects the physician's access to records and patients, and nothing in it controls the manner of care.

Disclaimer

This article is general educational information, not legal advice. Entity and corporate practice rules change, and parts of this summary rest on secondary sources, so have health care counsel in the state confirm the structure before you form or sign anything.