Food, Drugs, Healthcare, Life Sciences

On Friday, California Office of Health Care Affordability (“OHCA”) published proposed final regulations that implement a 2026 law that significantly expanded OHCA’s review authority over health care transactions involving private equity (“PE”) groups, hedge funds, and management services organizations (“MSOs”). Stakeholders involved in California health care transactions should re-assess whether their ongoing or contemplated transactions are implicated by these regulations, because newly covered transactions will need to comply with the 90-day advance notice requirement established in the original OHCA regulations.

Democrats in Congress have introduced the Stop Corporate Takeovers of Physicians Act, federal legislation that would establish unprecedented restrictions on physician practice ownership and management services organization structures. Drawing from Oregon's Senate Bill 951, this proposal would create a national framework in an area historically regulated exclusively at the state level, raising critical questions about federal-state interaction and the future of healthcare practice ownership.

Private equity investment in concierge medicine, aesthetic dermatology and medispas has surged due to cash-pay economics, recurring revenue models and fragmented markets ripe for consolidation. However, navigating state-by-state corporate practice of medicine prohibitions, licensure requirements and evolving GLP-1 regulations requires sophisticated legal structuring to protect valuations and enable successful exits.