A bill introduced in both chambers of Congress on September 16, 2026 would create a federal corporate practice of medicine rule, making it unlawful for a company that is not majority-owned and controlled by physicians or advanced practice providers, such as physician assistants and nurse practitioners, to own a medical practice. It would also take away most of the control a management services organization can hold over the practice it serves.

The Stop Corporate Takeovers of Physicians Act of 2026 is S. 5419 in the Senate, sponsored by Sen. Elizabeth Warren of Massachusetts with Sens. Ron Wyden and Jeff Merkley of Oregon as cosponsors. Its House twin is H.R. 10444, sponsored by Rep. Val Hoyle of Oregon. Congress.gov lists the two as identical bills.

Neither has moved. As of October 8, 2026, the last action Congress.gov records for each is its committee referral on the day it was introduced: the Senate bill to the Committee on Commerce, Science, and Transportation, the House bill to Energy and Commerce and to Ways and Means. H.R. 10444 had 15 cosponsors by that date. Every sponsor and cosponsor in both chambers is a Democrat.

For med spas the stakes are plain. The MSO is a common way for a non-clinician owner or investor to take part in a practice in states that restrict who may own one, and this text targets that structure directly. We read the 19-page bill text posted by Warren's office, which carries no bill number.

What the bill would prohibit

Section 2 would bar any partnership or corporate entity that is not "majority-owned and controlled by 1 or more licensees" from owning or controlling a medical practice "in whole or in part," from employing or contracting for a licensee's professional services, and from engaging in the practice of medicine. Majority means two things at once: licensees hold a majority of the ownership interest and make up a majority of the governing body.

"Licensee" is defined as a physician "or other advanced practice provider such as a physician assistant or nurse practitioner" who is authorized under state law to diagnose and treat patients. Registered nurses and aestheticians are not named. Licensee owners would also have to be licensed and present in a state where the practice sees patients, and be "substantially engaged in delivering medical care."

The exceptions cover non-profit and public health care providers, hospitals, hospital-affiliated clinics, critical access hospitals and rural emergency hospitals. We found no exception based on a practice's size or specialty.

The MSO restrictions

An MSO, along with its shareholders, directors, officers, employees and contractors, could not own or control shares in a medical practice, serve as a director or officer of one, or finance the purchase of its shares. It could not control or restrict the sale or transfer of the practice's shares or assets. Nor could it advertise the practice's services "under the name of an entity that is not the medical practice."

Then there is control. The bill bars an MSO from controlling a practice's operations in a way that affects the nature or quality of care, and lists decisions over which it could not hold ultimate authority, among them hiring and firing, licensees' schedules and pay, staffing levels, billing policies and the prices charged for licensees' services.

Management contracts would survive on two conditions. The practice must have negotiated at arm's length through lawyers and financial advisers it picked itself, and the compensation must reflect fair market value "as determined by the Commission," meaning the Federal Trade Commission.

Non-compete, non-disclosure and non-disparagement agreements with licensees would be void, except that a non-compete could bind a licensee who holds 25 percent or more of the practice.

Enforcement and outlook

The FTC would enforce the law, and state attorneys general could sue as well. Anyone injured by a violation could bring a civil action, and a court could award treble damages plus attorney's fees. A court that finds a violation would have to order the conduct stopped and, where applicable, order divestiture and the disgorgement of revenue received during the violation. Section 3 would add violators to the list of entities that can be excluded from federal health programs.

State laws that are equally or more strict would stay in place. The requirements would take effect one year after enactment.

Holland & Knight, in an alert dated September 17, 2026, said the legislation "draws substantially from Oregon's Senate Bill (SB) 951." It was cautious on timing. "Given the limited legislative calendar remaining in 2026, near-term enactment would require significant additional congressional action," the firm wrote.

The 119th Congress ends in January 2027. A bill that has not passed by then expires and would have to be introduced again.

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