What limits does Colorado place on a med spa's business structure?
Ownership · part of The Practice Perimeter
Short answer
Colorado bars a physician from practicing as the employee of any corporation other than a professional service corporation, whose shareholders must be actively practicing Colorado physicians (physician assistants may hold a minority).
It is unprofessional conduct to practice medicine “as the partner, agent, or employee of, or in joint venture with, any person who does not hold a license to practice medicine within this state”, or as an employee of or in joint venture with “any corporation other than a professional service corporation for the practice of medicine as described in section 12-240-138.” The general-business-corporation med spa employing its own physician is the arrangement this forecloses.
Colo. Rev. Stat. § 12-240-121(1)(g)(I) · verified Sep 2, 2026 · regulatory monitoring, not legal advice
Related Colorado rules
A professional service corporation must be “organized solely for the purpose of permitting individuals to conduct the practice of medicine through a corporate entity, so long as all the individuals are actively licensed physicians or physician assistants in the state of Colorado”, and its name must contain “professional company” or “professional corporation” or an abbreviation. The entity is a vehicle for licensed practice, not a holding structure.
Colo. Rev. Stat. § 12-240-138(1)(a)–(b) · verified Sep 2, 2026
⚠️ shareholders must be licensed, and must actually work there. All shareholders are persons licensed by the board “who at all times own their shares in their own right” — except that physician assistants may hold shares “as long as the physician shareholders maintain majority ownership.” Shareholders must be “actively engaged in the practice of medicine … in the offices of the corporation”, allowing only for illness, accident, armed service, vacations and leave of up to a year. A passive licensed investor does not qualify.
Colo. Rev. Stat. § 12-240-138(1)(d)(I) · verified Sep 2, 2026
How other states answer this
- Alabama
- Alaska
- Arizona
- Arkansas
- California
- Connecticut
- Delaware
- District of Columbia
- Florida
- Georgia
- Hawaii
- Idaho
- Illinois
- Indiana
- Iowa
- Kansas
- Kentucky
- Louisiana
- Maine
- Maryland
- Massachusetts
- Michigan
- Minnesota
- Mississippi
- Missouri
- Montana
- Nebraska
- Nevada
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Ohio
- Oklahoma
- Oregon
- Pennsylvania
- Rhode Island
- South Carolina
- South Dakota
- Tennessee
- Texas
- Utah
- Vermont
- Virginia
- Washington
- West Virginia
- Wisconsin
- Wyoming
Related Colorado questions
- Can a non-physician own a med spa in Colorado?
- Can private equity invest in a med spa in Colorado?
- In Colorado, may a non-clinical owner or manager be paid a share of revenue?
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← All Colorado rules and changes · MedSpaRadar is regulatory monitoring and reference: it summarizes public laws, regulations and agency actions and links each to its source. It is not legal, medical, or compliance advice, and using it creates no attorney-client relationship. A summary can lag its source or leave out detail, and monitoring itself can be interrupted — so an absence of alerts means nothing reached you, not that nothing happened. Read the cited source, check its effective date, and confirm any change to your operations or clinical practice with qualified health-law counsel and your medical director. Legislative data via LegiScan (CC BY 4.0).