Texas Physician PC Owner & CPOM Guide

Texas Occupations Code Chapter 155 establishes that only licensed physicians may practice medicine in Texas. The CPOM doctrine in Texas prohibits unlicensed persons or entities from controlling a physician's medical judgment. The Texas Medical Board has interpreted this broadly to cover MSO arrangements that give non-physicians operational authority over physician clinical decisions.

Texas allows both Professional Corporations (PCs) and Professional Limited Liability Companies (PLLCs) for physician practices. The choice between PC and PLLC has tax, governance, and documentation implications. For MSO-PC structures, either entity type can work, but the documentation must be appropriately tailored. Texas PLLCs use an Operating Agreement rather than Bylaws and Articles of Incorporation.

The MSO-PC structure is the standard compliance mechanism in Texas. The physician entity must be physician-owned. The MSA must not give the MSO authority over clinical decisions. Texas Medical Board guidance is that the physician owner must have meaningful control over the clinical operations of the PC — on paper and in practice.

Texas has expanded telehealth availability but has not relaxed CPOM rules for telehealth operators. A telehealth company serving Texas patients must have a properly structured Texas physician entity (PC or PLLC) to comply. Telehealth operators who formed a single national PC in another state should verify whether that structure is sufficient for Texas operations.

The Texas Medical Board has been active in pursuing enforcement actions against CPOM violations, particularly in the medspa and telehealth sectors. Common violations include MSAs that give MSOs control over physician hiring and termination, and management structures where the non-physician entity effectively controls all clinical decision-making.