Maryland Practice Structure Guide: The Professional Corporation, Referral Fee Law and Strict Cosmetic Delegation Rules
Maryland has no clear corporate practice statute, but its professional corporation law, its referral-payment discipline ground and its Board delegation regulation keep the structure tight, and the physician must personally assess each cosmetic patient.
Key Highlights
- The Maryland Professional Service Corporation Act limits stock to authorized individuals and bars the corporation from non-professional activities, so the practice should not own the management company.
- Maryland names may use P.C., P.A. or Chartered, but P.A. is a naming option and not a separate entity type.
- Discipline covers paying any sum to any person for bringing or referring a patient, and we found no express ban on percentage management fees.
- A 2026 bill requiring notice of transactions involving MSOs and private equity did not pass.
Entity and Ownership
The Maryland Professional Service Corporation Act expressly covers physicians and osteopaths. Stock may be issued to individuals authorized to render the service in Maryland or another state, qualifying partnerships and other professional corporations, and stock issued in violation is void. Services may be rendered only through licensed individuals, with unlicensed staff allowed for non-licensed work, and generally one profession per corporation. The corporation may not carry on non-professional activities or take an active role in running an unrelated venture, which matters if anyone proposes that the practice own the MSO or other side businesses. The name must include Chartered, Professional Association, P.A., Professional Corporation or P.C., and the Board of Physicians need not approve names of entities whose members are licensed physicians.
The Corporate Practice Position
Maryland has no clear corporate practice statute, Board rule or key case that we found. A 2015 Maryland law-firm article says the doctrine emerges opaquely from statutes and cases, that Maryland courts have never explicitly embraced it, and that the practical rule is physician or licensee ownership or a statutorily permitted entity. The statutory hooks we verified are the rule that a professional corporation render services only through licensed individuals and the discipline ground for practicing medicine with or aiding an unauthorized person. A vendor guide cites another section as the corporate practice prohibition, and we could not retrieve it. We found no relevant Attorney General opinion or enforcement.
The Management Agreement and Fees
The health occupations article makes it a ground for discipline to pay or agree to pay any sum to any person for bringing or referring a patient, to solicit through an agent, and to violate any state or federal law. There is no express percentage-of-fees ban in the text we read, and a percentage fee that rewards the MSO for generating patients is the exposure we see under the referral ground, which is our inference. The self-referral statute bars referrals to entities in which the practitioner has an ownership interest or compensation arrangement and reaches indirect arrangements, so the physician should not refer to an MSO-affiliated pharmacy, lab or imaging entity in which they hold an interest absent an exception.
Maryland voids non-competes for licensed health care providers who give direct patient care and earn $350,000 or less, and above that threshold limits them to one year and ten miles.
Med Spa and Aesthetic Rules
COMAR 10.32.09 governs delegation of cosmetic medical procedures covering lasers, intense pulsed light, radiofrequency, peels that ablate tissue, injections and fat destruction. The delegating physician must hold a Maryland license and have training, and delegation is allowed only to a physician assistant or another licensed provider whose own board says the procedure is within scope. The physician must keep written protocols at each site, personally perform the initial assessment, write a treatment plan, obtain informed consent and supervise on site when a non-physician performs procedures, except where the Board approves a physician assistant delegation agreement allowing immediate availability. Medical assistants and estheticians cannot perform these procedures. Maryland has no separate med spa license.
2025 and 2026 Developments
Senate Bill 494 and House Bill 944 would have required 90 days' notice to the Maryland Health Care Commission of material change transactions including those involving MSOs and private equity, but the 2026 status index shows hearings only and no passage. Nothing enacted this session changes practice structure.
How We Structure It
As a rule we set up a professional 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 Maryland the practice does not own the management company, and the physician personally performs the initial assessment for cosmetic patients.
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.
MedGrid MSO provides management services to independently owned practices; it does not practise medicine and does not direct clinical decisions. Requirements vary by state and by service, and change over time — nothing on this page is legal or medical advice. Talk to us or your own counsel before making a structural decision for your clinic.