Stop Corporate Takeovers of Physicians Act of 2026
- Sponsor
- Sen. Warren, Elizabeth [D-MA]
- Committees
- Commerce, Science, and Transportation Committee (primary)
- Last action
- Sep 16, 2026
Bottom line
The bill aims to fundamentally restructure the ownership and operational control of medical practices, shifting power from corporate entities and MSOs back to licensed health professionals to prioritize patient care over profit.
What it actually does
This bill prohibits the corporate practice of medicine by entities not majority-owned and controlled by licensed health professionals, with exceptions for non-profits and hospitals. It bans non-compete clauses and non-disclosure agreements for licensees, restricts health care providers from interfering with clinical judgment, and significantly curtails the operations and influence of management services organizations (MSOs) over medical practices. The bill also establishes robust enforcement mechanisms, including FTC authority, a private right of action, and state attorney general actions.
Proponents argue
Proponents argue that the bill is essential to restore physician autonomy, ensure patient-centered care, and prevent corporate profit motives from compromising medical decisions. They contend that corporate ownership and MSO influence lead to reduced quality of care, increased costs, and burnout among healthcare professionals, and that these measures will foster a more ethical and competitive healthcare environment.
Opponents contend
Opponents might contend that the bill would cause significant disruption to the healthcare industry, potentially limiting access to capital for practice expansion and innovation. They could argue that corporate structures and MSOs provide valuable administrative efficiencies, technological advancements, and financial stability that benefit both practitioners and patients, and that these restrictions could lead to increased administrative burdens and reduced efficiency.
The bill is relatively short and accessible, allowing an informed reader to evaluate its core provisions within the estimated reading time.
Section 2(a)
Prohibition on Corporate Practice of Medicine
This provision makes it unlawful for any partnership or corporate entity that is not majority-owned and controlled by one or more licensed health professionals to own or control a medical practice, employ licensees for professional services, or engage in the practice of medicine. It defines 'majority-owned and controlled' as licensees holding a majority of ownership interest and constituting a majority of the governing body.
Supporters argue
Supporters argue this prohibition ensures that medical decisions are driven by patient care rather than corporate profit motives, restoring the traditional physician-patient relationship and enhancing professional integrity.
Critics contend
Critics might contend that this measure could disrupt existing healthcare models, limit access to capital for practice expansion, and reduce administrative efficiencies that corporate structures can provide, potentially impacting patient access and innovation.
Tradeoffs
The provision navigates the tension between safeguarding physician autonomy and patient interests, and allowing for the capital investment and operational scale that corporate entities can bring to healthcare delivery.
Section 2(a)(3)
Exceptions to Corporate Practice Prohibition
This subsection carves out specific exceptions to the prohibition on the corporate practice of medicine. It states that the prohibition does not apply to non-profit or public health care providers, hospitals, hospital-affiliated clinics, critical access hospitals, or rural emergency hospitals, allowing these entities to continue their current ownership and employment structures.
Section 2(b)(1)(A)
Prohibition on Non-Compete and Non-Disclosure/Disparagement Clauses
This provision makes it unlawful and unenforceable for licensees, health care providers, or management services organizations to enter into non-compete clauses or non-disclosure/non-disparagement agreements. A specific exception allows a non-compete clause to be valid if the licensee holds 25 percent or more of the ownership interest in the medical practice.
Section 2(b)(1)(B)
Restrictions on Interference with Clinical Judgment
This provision prohibits health care providers from directly or indirectly interfering with a licensee's professional judgment or clinical decisions. This includes actions such as specifying patient visit times, determining patient clinical status (e.g., admission, palliative care), dictating treatment initiation, controlling referrals, having final authority over diagnostic codes, or influencing clinical decision-making through electronic health record configurations.
Section 2(b)(2)
Restrictions on Management Services Organizations (MSOs)
This extensive provision prohibits MSOs from controlling or restricting the sale of medical practice assets, issuing ownership interests, paying dividends, owning interests, acquiring interests, or participating in managing a medical practice. It mandates that MSO contracts be negotiated at arm's length with fair market value compensation, prohibits MSOs from advertising under non-practice names, and prevents them from exercising de facto control over administrative or clinical operations, including hiring, compensation, staffing, patient time, revenue disbursement, diagnostic coding, or billing policies.
Section 2(c)
Requirements for Medical Practice Owners
This section mandates that licensee owners of a medical practice must be licensed and physically present in the state where the medical services are furnished. Additionally, these owners must be substantially engaged in delivering medical care, preventing absentee or purely financial ownership by licensees.
Section 2(e)
Enforcement by FTC, Private Right of Action, State AGs
This section grants the Federal Trade Commission (FTC) authority to enforce the Act, treating violations as unfair or deceptive acts or practices. It establishes a private right of action for any person injured by a violation, allowing them to seek treble damages, attorney's fees, and other relief. State Attorneys General are also empowered to bring civil actions on behalf of their residents. For any violation, courts are mandated to issue orders requiring cessation, divestment, and disgorgement of revenue.
Section 3
Exclusion from Federal Health Programs for Violations
This section amends the Social Security Act to add violations of the restrictions regarding management services organizations (MSOs) as a basis for exclusion from Federal health care programs, such as Medicare and Medicaid. This means entities found to be in violation of the MSO rules could lose their ability to receive payments from these federal programs.
Section 4
State Law Preemption Rules
This section clarifies that the Act does not preempt, displace, or supersede any State law that imposes equal or more stringent ownership and control requirements on medical practices, affords equal or greater protection to licensees, or imposes equal or more stringent restrictions on management services organizations. This allows states to maintain or enact stronger regulations than the federal baseline.
This subsection defines what constitutes the 'practice of medicine' for the purposes of determining when a management services organization (MSO) is deemed to be providing such services. It specifies that an entity is practicing medicine if its services affect the patient-licensee relationship, including performing patient evaluations that lead to diagnostic/therapeutic plans, and imposing administrative or facility-based measurements or restrictions on the patient-licensee relationship.
Section 2(d)(4)(B)
Why it matters:While placing definitions in a dedicated section is standard legislative practice, the operational impact of this specific definition is profound and could be considered technically phrased to avoid immediate scrutiny of its broad implications for MSO business models.
Case for: Supporters argue this definition is crucial to prevent MSOs from circumventing the bill's intent by indirectly influencing clinical care through seemingly administrative means, ensuring that the spirit of the corporate practice prohibition is upheld.
Case against: Critics might argue this definition is overly broad and could inadvertently capture legitimate administrative functions that indirectly touch on patient care, creating significant regulatory ambiguity and potentially hindering efficient practice management.
Estimated impact: This definition has a potentially broad impact on how MSOs structure their services and interact with medical practices, requiring a re-evaluation of many common MSO functions and potentially leading to legal challenges over its interpretation.