It depends what state you’re in as to what you’re allowed to do, what you’re not allowed to do. So in a situation where a nurse can be a part-owner of the medical practice, generally there’s no need for an MSO. But for example, in California, a nurse can only own 49% maximum. So you can only take 49% of the earnings of that med spa.

In states like Texas where a nurse cannot own even part of a medical practice, you’re going to need to do an MSO and it’s not an issue of splitting earnings. And here’s where it gets a little nuanced, but it’s pretty simple.

By law, in every state, the patients themselves, belong to the medical practice and not to the MSO. That’s what the state recognizes. And so therefore, all the money brought in by the medical practice for doing procedures, even if it’s collected by the MSO, that money has to go to the bank account of the medical practice. And from there, the medical practice then pays the MSO its fee for doing all the management services.

If you’re just an MSO, then you’re not really splitting anything because they’re not your earnings. If you are part-owner in a med spa, then you have to split the earnings because there’s another partner or owner, member or whatever. It just depends on the state law. It depends on who you have involved in the business.

So you have to look at what the state requires and how you set it up, what the legal requirements are, and then you have to decide how those earnings are going to flow into the medical practice and then back to you, whether you’re just the MSO owner. You can be the MSO owner and also be the nurse performing procedures where you would work under some kind of employment contract with the medical spa, so you can make money two different ways if you’re just a partner or a co-owner of the med spa. Some states you can be whatever percentage you want. Some states, like California I was mentioning, you can only take 49% of those earnings.