Industry • Best Practice
Medical Spa Requirements and Regulations to Know Before Opening Your Business
Apr.25,2023By Boulevard Staff
Medspas are medical offices, so there are legal waters to navigate before cutting the ribbon
Navigating legal waters is never fun, but it’s particularly painful when your business hangs in the balance. If you're considering starting a medspa, you probably know the feeling well. There are book-sized lists of medical spa requirements to familiarize yourself with before opening your doors, covering everything from HIPAA to hiring. Don’t fret — the legal requirements are perfectly manageable with the right resources. In this blog post, we'll discuss the key regulations and HIPAA-related requirements medspa professionals need to follow, along with the potential penalties for non-compliance.
Who can own a medspa?
Generally speaking, only a licensed physician is legally allowed to own a medspa. Clients visit medspas for actual medical services, some of which require clinical referrals, which brings medspas under the same purview as any other medical facility.
In some states, non-physicians can own medical spas via a management services organization (MSO). An MSO takes care of the day-to-day business and administration responsibilities that keep a medspa running, such as payroll, billing, and collections. However, an MSO must still hire a physician to perform medical procedures, and the specifics for which duties an MSO can and can’t perform vary by state. Before you cut the ribbon to your medspa, check with your legal counsel to verify that you and your employees have obtained the right licenses and credentials to operate.
Are medical spa requirements different for each state?
Yes, there are different legal requirements that medical spas must follow depending on the state they’re based in. For example, Florida medical spa requirements don’t state that licensed medical professionals have to own the medspa. However, non-physicians in Florida can’t receive compensation for a medical service even if they own the business, which makes the organizational structure rather tricky. Consult your legal counsel to determine the specific requirements you’ll be expected to meet at a state level when opening a medspa.
Can my medspa accept tips?
One common question newcomers to the medical spa industry have is whether or not it’s acceptable to accept tips. Medspa professionals should avoid accepting or asking for tips due to fee-splitting and kickback regulations that limit payments for medical procedures. Accepting gratuity is considered an ethically gray area or flat-out illegal, even for non-medical professionals working in a medspa setting.
Any agreement to exchange gratuity may lead to an investigation by a state medical board or other governmental bodies, regardless of whether the gratuity was exchanged consensually. The punishment for breaking these rules is severe and can result in having a medical license revoked. Because of how medspas are structured, that would almost certainly mean that the business is shut down.
Following HIPAA regulations
One of the chief concerns of any medical office should be implementing and respecting proper HIPAA guidelines. Medspa owners should do everything in their power to ensure the privacy and security of protected health information (PHI), minimizing the chances that a client’s personal information is mishandled. To do so, medspa owners should periodically review HIPAA regulations and establish a checklist of procedures to follow. Some key HIPAA considerations include:
Implementing administrative, physical, and technical safeguards to protect PHI.
Conducting regular audits to determine how PHI is created, received, stored, or transmitted, and how it is shared.
Training employees on HIPAA compliance and ensuring that standards are being met without fail.
Failure to comply with the various regulations governing medspas can result in severe penalties, including fines, suspension or revocation of licenses, and even criminal charges in some cases. HIPAA violations can carry particularly hefty fines, ranging from $100 to $50,000 per violation, with a maximum penalty of $1.5 million per year for each violation category.
Software makes all the difference
Your choice of business software will largely determine the strength of your organization’s backbone. You want to select an option that is simultaneously easy to use — both for you and your clients — while also allowing for ample customization and the secure storage and transfer of patient information. Because of the impact software can have, this is one of the most important considerations you’ll make as you build your business.
Your software should be client-forward, allowing you to personalize the experience for everyone that interacts with your business. Find a solution that will make self-booking appointments a seamless experience, while also making it easy to access pertinent information like allergies, charts, and treatment history during the client’s visit. All that information needs to be handled securely, though, so your software should also support HIPAA-compliant client profiles.
Boulevard meets all of those requirements while also packing a sizeable list of other helpful features, such as a robust marketing suite, real-time inventory management, and a sleek POS system. Our solution can help you meet HIPAA-related medical spa requirements while removing some of the stress that comes with running a beauty business. Contact us today to get a demo.