Ownership restrictions in legal and healthcare services

Physician Conflicts of Interest In the U.S., our approach to managing potential physician conflicts is largely centered around ownership. Some of the rules are outright prohibitions... physicians can't own hospitals. Some laws, like Stark, place limits on physicians referring patients to practices/facilities in which they have ownership interests. As a matter of principle, do we need a mechanism to help protect patients from physician self-dealing... those who might consciously or unconsciously put their financial interests above a patient's? I think there's a strong argument for it. Even though 999 physicians will always do what's best for their patients, there's a reasonable possibility that 1 will behave in their own interests (and not the patient's). So, what's the problem with our current system that's based largely on physician ownership? It completely ignores the potential conflicted relationship between large health systems/ health insurance carriers as employers and their employed doctors. Let us not forget that approximately 70% of doctors are now employees. United Health alone employs ~90,000 doctors. Employed doctors are subject to powerful sticks and carrots, including metrics and financial bonuses, that encourage employed doctors to steer patients to services offered by their employers. Is this always what's in the best interest of patients? Many employed doctors will tell you it's not. But it's all perfectly legal because the referring physician isn't an owner in any of it. It's also a major potential conflict of interest. So, what do we do about it? Here's one idea... remove the prohibitions related to ownership and switch to a disclosure model... wherever there's a potential conflict of interest, the patient must be clearly informed of it (and possibly acknowledge it in writing). This would cover both situations where a physician owns something and where an employed physician is being directed and paid to make 'in system' referrals. This is how we manage conflicts in most other industries, particularly banking and investing. Let's put the power of knowledge in the hands of patients and let them decide. More importantly, let's stop giving large hospital system and insurance carrier employers a free pass.

🔴 This week, Oregon Gov. Tina Kotek signed SB 951, setting the most stringent restrictions in the U.S. on private equity (PE) and corporate influence in medical practices. ➡️ What’s new? - Bans MSOs (management services organizations) from owning, controlling, or directing clinical entities they manage. - Prohibits patient scheduling, coding, billing, pricing, staffing, and even non‑compete agreements, when tied to PE-backed management. - Takes effect for new deals on Jan 1, 2026, and for existing ones by Jan 1, 2029. 🏥 Why it matters: - Aligns with a growing national backlash against PE in healthcare, echoing moves in states like Massachusetts, New Mexico, Indiana, and Washington. - Anchors clinical autonomy by ensuring medical decisions remain with providers, not corporate owners. - Responds to real-world concerns, from increased prices and practice closures to diminished care quality following PE consolidation. ⚖️ But there’s tension: - Opponents warn such sweeping restrictions may chill critical investment, especially in rural or underserved communities where PE can be a capital lifeline. - Industry groups stress MSOs’ role in handling administrative burden, cautioning that small clinics may suffer. 🔍 Looking ahead: - Oregon’s MSO model and PE umbrella structures will be closely scrutinized as SB 951 takes effect. - The state’s move dovetails with federal scrutiny and FTC enforcement actions targeting PE consolidation. - Other states are eyeing similarly bold regulations to protect patient-first care. 💰 Why this matters to the healthcare ecosystem: - For healthcare executives and M&A professionals: A paradigm shift in MSO and PE-affiliated deal structures, requiring in-depth compliance reviews before year-end. - For providers: Reinforced local control over care delivery, though with the possible tradeoff of reduced management support. - For policymakers and advocates: A test case in balancing access to capital with safeguarding patient-centered medicine. 💬 Share your perspective by commenting below. - Is Oregon setting a vital precedent to preserve clinical autonomy? - Or could SB 951 unintentionally weaken healthcare delivery, especially in rural markets? 🔔 Follow me (Sina S. Amiri) to stay ahead of how legislation is reshaping healthcare delivery models across the U.S. ℹ️ This post and any commentary is provided for general informational purposes only and does not constitute financial, investment, tax, legal or accounting advice. #Healthcare #Medicine #PrivateEquity #Regulation #Law

A Nurse Practitioner just told my team her brilliant "loophole" to own a med spa in Texas: "Just don't call it a med spa!" I had to bite my tongue. Here's why this common "hack" could cost her everything: The Texas Medical Board doesn't care what you call your business. They care what you DO in it. If you're: • Performing medical procedures • Injecting anything • Dispensing prescription products • Treating medical conditions ...you're practicing medicine. Period. And in Texas, only physicians can own medical practices. Non-physicians can own management companies. "But what if I call it a wellness center?" Still practicing medicine. "What about a beauty bar?" Still practicing medicine. "How about a drip lounge?" You guessed it - still practicing medicine. The board isn't fooled by creative naming. They investigate SERVICES, not signs. The penalties? • License suspension • $5,000+ fines per violation • Criminal charges • Forced business closure I've seen NPs lose everything following this "advice." There IS a legal way for NPs to run aesthetic practices in Texas: Through a properly structured MSO arrangement with a physician. Is it more complex? Yes. More expensive? Maybe. Worth it? Absolutely. Because your license isn't just a piece of paper. It's your career. Your future. Your dream. Don't risk it all on a "loophole" that isn't one. Follow for more healthcare law insights that protect your practice and license. #HealthcareLaw #NursePractitioner #MedSpa

Australia is sliding into managed care by stealth. Unless we act. Private hospitals are under huge financial strain. Instead of reforming funding, government and regulators are quietly allowing insurers and large corporates to buy into the system. • Medibank now co-owns hospitals and mental health facilities. • Bupa is rolling out its own clinics and “Mindplace” centres. • Wesfarmers owns a pharmacy network and a national telehealth business. Doctors, meanwhile, remain locked out of pharmacy ownership. Patients face shrinking choice, and the risk that insurers will “steer” them into facilities they themselves own. This is vertical integration, where the same corporate controls the money, the decision, and the service. It stabilises private hospitals in the short term but creates long-term risks of monopoly, data capture, and loss of clinical independence. What needs to change: 1️⃣ Ownership limits Cap the extent to which health insurers can own hospitals, clinics, or pharmacies, just as pharmacy ownership laws restrict who can own a pharmacy. 2️⃣ No-steering rules Prohibit insurers from structuring benefits, apps, or marketing in ways that funnel patients toward their own clinics or hospitals when independent alternatives exist. 3️⃣ Transparency and reporting Mandate public reporting of related-party ownership, referrals, and patient flows so consumers know when they are being directed to an insurer-owned facility. 4️⃣ Data firewalls Require insurers who own providers to keep claims and clinical data strictly separate and ban its use for anticompetitive purposes. 5️⃣ Independent funding reform Rather than letting corporates prop up private hospitals, government should lead reform of hospital funding, invest in public capacity, and modernise the private insurance framework to preserve choice. This isn’t about blocking innovation: short-stay hospitals, virtual care, and community clinics are vital. But without guardrails, we risk ending up in a US-style managed care model by default, without the transparency or protections that patients and clinicians deserve. 👉 Should we let insurers and retailers shape the future of Australian healthcare, or is it time for Parliament to step in with clear rules? #HealthcarePolicy #ManagedCare #PrivateHospitals #PatientChoice #Australia

🏥 Senators Target REIT Sale-Leasebacks in Health Care Senators Edward Markey (D-MA), Bernie Sanders (I-VT), and Richard Blumenthal (D-CT) have introduced the Stop Medical Profiteering and Theft (MPT) Act, a bill aimed at curbing what they describe as “predatory” sale-leaseback practices between health systems and real estate investment trusts (REITs). The legislation follows the 2024 bankruptcy of Steward Health Care, which the sponsors blame on “unsustainable rent obligations” tied to its sale-leaseback with Medical Properties Trust, Inc. (NYSE: MPW). Steward’s collapse led to the closure of five hospitals nationwide and has become a rallying point for congressional scrutiny of financial engineering in healthcare. 🔍 Key Provisions * Prohibits health systems from entering lease or sale agreements with REITs that “weaken financial status” or risk public health. * Requires HHS review of all lease agreements to assess long-term financial impact on hospitals. * Closes REIT tax loopholes for rental income from health care properties. 💬 Statements & Support * “The Steward crisis showed what happens when corporations put profits over patients,” said Sen. Markey. * “This bill will ensure health systems are protected from financial mismanagement driven by corporate greed.” * The legislation is endorsed by the Private Equity Stakeholder Project, Americans for Financial Reform, Public Citizen, and the American Federation of Teachers. ⚖️ Industry Impact: If enacted, the MPT Act could significantly alter the REIT–healthcare provider financing model, restricting hospital sale-leasebacks and tightening HHS oversight. Analysts note that while the measure faces long odds in a divided Congress, it adds to mounting political scrutiny of healthcare REITs and private equity ownership in essential services. https://lnkd.in/g_28riiP

Here's what's happening right now in the US: Private equity can't directly own law firms in most states. So they're using Management Services Organizations (MSOs). Burford Capital (world's largest litigation funder) is actively pursuing investment opportunities to invest in MSOs. Both Trisha Rich of Holland & Knight and Lucian Pera of Adams & Reese report closing an undisclosed amount of "private equity investments into MSOs that support law firms." (FYI - They are the best in the business of US law firm ethics and compliance.) How it works: PE acquires most firm assets except what must be law firm-owned (like client records). Then enters long-term service agreement with the law firm entity. Travis Lenkner at Burford: "MSO structure is old hat in public accounting, healthcare and other professional spaces." He's right. It's proven in other industries. But here's what US managing partners need to understand: MSO structures introduce governance complexity absent from direct equity ownership. To get the long-term service agreements right between the law firm and MSO, you need aligned incentives/ culture/ values and an iron-clad strategy for regulatory compliance. (Again... insert Trisha and Lucian to get the job done.) Without a strong team behind you, you may end up with: → Misaligned incentives → Disputes over economic terms → Regulatory scrutiny of whether the structure effectively circumvents ownership restrictions For firms in Arizona or Utah where direct equity investment is possible via an ABS structure? MSO provides multi-state flexibility where the ABS direct investment is tied to individual states and a different approach for compliance. *cough* ...Get the right team to help you decide which structure and approach best fit your private equity or law firm. The UK experience with direct PE ownership offers lessons. But it doesn't map perfectly to the MSO workaround many US firms will face. Columbus Street is an M&A advisory firm serving corporate law firms.