The Booming Business of Botox: Legal Considerations for Medical Spas

In an article for the American Health Law Association, health care partner Jamie Levin and associates Hafsa Warsamee and Larissa Morgan broke down regulatory considerations for the growing medical spa industry. 

The authors noted that medical spas, which aim to offer a range of medical-grade and aesthetic purposes, have grown in number from just 1,600 in 2010 to over 11,000 today. As health care providers and investors look for opportunities to enter the industry, they should be aware of increased regulatory oversight, as the current patchwork of existing state regulations can present challenges to stakeholders navigating the growing industry. In Illinois, for example, medical spas are considered medical practices and therefore must operate as a professional services entity and prohibits non-licensed individuals from owning a business that provides professional services and instead requires individuals licensed to perform the professional services, such as physicians, to hold ownership. Conversely, other states allow for more flexibility in ownership, the authors note, requiring a physician or nurse practitioner to supervise medical procedures at spas. The authors said that prior to forming a medical spa, parties should confirm their state’s existing regulations to ensure ownership-compliance. 

“The U.S. medical spa market is currently valued at approximately $6 billion and is projected to experience an annual rate exceeding 14% over the next five years,” the authors noted. “This rapid expansion has not only attracted significant interest from private equity investors eager to capitalize on the growth potential but has also brought increased regulatory oversight, with states implementing more stringent regulations.”