Illinois ownership & cpom for med spas

Ownership & corporate practice of medicine in Illinois

Illinois is among the strictest corporate-practice states, and its regulators say so in a document written for med spas specifically: a med spa is a medical practice, so it must be owned by physicians — or, for the services within their scope, by APRNs. There is no room for a non-clinical shareholder in the entity that delivers care.

• ⚠️ Illinois has a dedicated fee-splitting section and its ban is not limited to referrals. “a licensee under this Act may not directly or indirectly divide, share or split any professional fee or other form of compensation for professional services with anyone in exchange for a referral or otherwise, other than as provided in this Section 22.2.” The words “or otherwise” do the work — an arrangement with no referral in it is still inside the section unless an exception applies.

  225 ILCS 60/22.2(a) · verified Sep 2, 2026

• The first exception is for genuine shared work, on three conditions. Two or more licensed health care workers may “each receive adequate compensation for concurrently rendering services to a patient and … divide the fee” — provided “the patient has full knowledge of the division” and the division “is made in proportion to the actual services personally performed and responsibility assumed by each licensee consistent with his or her license”. Concurrent work, proportionate split, patient knowledge.

  225 ILCS 60/22.2(b) · verified Sep 2, 2026

• ⚠️ the second exception is the entity route, and its first condition is the corporate-practice rule. Nothing prohibits practicing “through or within any form of legal entity authorized to conduct business in this State” or “pooling, sharing, dividing, or apportioning the professional fees and other revenues in accordance with the agreements and policies of the entity” — PROVIDED “(1) each owner of the entity is licensed under this act”, (2) it is organized under the Medical Corporation Act, Professional Services Corporation Act, Professional Association Act or Limited Liability Company Act, and (3) it is allowed by Illinois law to provide physician services. Revenue sharing inside a wholly licensee-owned entity is fine; outside one it is not.

  225 ILCS 60/22.2(c) · verified Sep 2, 2026

• IDFPR and IDPH state that because the services a med spa provides are medical services, the Medical Practice Act and the Nurse Practice Act require med spas to be owned and operated by physicians — and, for some services, by advanced practice registered nurses. A med spa that is not organized as a corporate entity, such as a sole proprietorship or partnership, must still be owned and operated by a physician or an APRN.

  IDFPR/IDPH Medical Spa Services memo (updated 2025-10-30) · verified Aug 17, 2026

• Only physicians may organize under the Medical Corporation Act. Physicians may instead use the Professional Service Corporation Act or the Professional Limited Liability Company Act; APRNs may use only those latter two. A physician entity may have only physicians as shareholders or members, officers, directors or managers, and an APRN entity only APRNs.

  805 ILCS 15/ · 805 ILCS 10/ · 805 ILCS 185/ (as stated in the IDFPR/IDPH med spa memo) · verified Aug 17, 2026

• A person who is not a physician or an APRN cannot be a shareholder or member, an officer, a director or a manager of a med spa entity. That closes the door on an outside investor taking equity in the entity that delivers the care, whatever their commercial role.

  IDFPR/IDPH Medical Spa Services memo (updated 2025-10-30) · verified Aug 17, 2026

• Illinois names the combinations that may share one professional limited liability company, and the list is closed: a single entity may combine the practice of medicine, podiatry, dentistry and optometry — provided each service is offered only by people licensed for it, and every manager and member is licensed in at least one of the services the company offers. Cosmetology and esthetics appear in no combination group in the section.

  805 ILCS 185/13(b)(1) · verified Sep 1, 2026

• And a professional limited liability company may not be formed to practice medicine at all unless every manager is licensed under the Medical Practice Act of 1987 and every member is a physician, a registered medical corporation, a professional service corporation of licensed physicians, a hospital or hospital affiliate, or a professional limited liability company that itself meets one of those tests. There is no member category in that list that a lay owner fits.

  805 ILCS 185/13(a)(2) · verified Sep 1, 2026

Recent Illinois changes

• IL HB5000: Health Facilities PlanningAug 7, 2026
• IL HB4281: Certified Medical EstheticianJan 7, 2025