New Mexico Corporate Practice of Medicine (CPOM) Overview
- Does New Mexico have a Corporate Practice of Medicine (CPOM) Doctrine?: No. (But if you want your group to enroll with New Mexico Medicaid, a license is needed from the state, unless you have a physician-owned entity. This is fairly burdensome, so some groups prefer setting up a PC-MSO structure.)
- Summary of Current Law: New Mexico does not have a Corporate Practice of Medicine (CPOM) doctrine. In a 1987 opinion, the New Mexico Attorney General explored whether corporations run by non-physicians can legally offer medical services via employed doctors. The conclusion was affirmative, provided there are no legal prohibitions or instances of non-medical personnel exercising undue influence over medical decisions or exploiting the medical field contrary to public policy. This interpretation was influenced by the absence of specific directives in New Mexico's medical licensure laws concerning corporate provision of medical services, especially when contrasted with other professions like dentistry and psychology where such directives exist. The state's Professional Corporation Act also supports the formation of corporations for medical service provision. It allows for incorporation by individuals or groups to provide professional services for which they must be legally licensed. While these corporate entities can employ physicians, they are barred from practicing medicine directly or interfering in the professional autonomy of medical practitioners. They are also restricted to providing only one type of professional service and must ensure their officers and employees rendering these services are properly licensed. This framework ensures that corporations, even those led by non-physicians, can provide medical services through physicians without overstepping legal and ethical boundaries.
- Sources: New Mexico Stat. Ann. § 61-6-16.
What are Corporate Practice of Medicine (CPOM) Laws?
CPOM laws are regulations that prohibit standard corporations (or other non-physician entities) from practicing medicine or employing practicing physicians. The primary goal of these laws is to ensure that medical decisions are made solely based on patient care and not influenced by corporate interests. These laws vary by state, but they generally aim to protect the physician-patient relationship from commercial influence.
While the focus is often on physicians and medical care, the CPOM family of laws typically apply to a wide range of licensed healthcare providers, including psychologists, speech therapists, physical therapists, occupational therapists, mid-level providers (nurse practitioners and physician assistants), dentists, dietitians, podiatrists, chiropractors, pharmacists, optometrists, and many others. The goal of CPOM laws is shared across these professions: ensure clinical decisions aren’t influenced by corporate pressures.
Who Do These CPOM Laws Apply To?
A state’s CPOM restrictions typically apply to any standard corporate entity that seeks to provide medical or licensed healthcare services. This includes corporations, limited liability companies (LLCs), and other business entities. For an entity to comply with CPOM laws and practice medicine, it typically must be:
- 100% owned by a physician (or physicians) licensed to practice medicine in that state, and
- Formed as a special type of physician-owned legal entity: a Professional Corporation (“PC” for short). In some states, a Professional Limited Liability Company (“PLLC”) is also permitted.
Most states with CPOM laws only permit the corporate practice of medicine through these physician-owned PCs or PLLCs.
Complying with New Mexico CPOM laws
If you're looking to start a healthcare business in New Mexico and need to comply with New Mexico CPOM laws by setting up a MSO-friendly PC structure, Permit can help—affordably and fast. Feel free to reach out.
