Enforcement: Strict · 243 CMR 2.07(22) · c. 156A

CPOM Compliance for Massachusetts Healthcare Startups

Q: Does Massachusetts have strict CPOM?

Yes. Foundry rates Massachusetts Strict. Board of Registration in Medicine rule 243 CMR 2.07(22) lists the business organizations a physician may practice through (professional corporations under M.G.L. c. 156A, nonprofits, qualifying LLCs and partnerships, and comparable out-of-state entities). General business corporations are not on that list. M.G.L. c. 156A §§ 7, 9 and 10 require licensed shareholders, a licensed majority of directors, and licensed officers.

Q: What did Chapter 343 of the Acts of 2024 change?

Signed January 8, 2025 and effective April 8, 2025, Chapter 343 expanded Health Policy Commission, CHIA and Attorney General oversight of private equity investors, management services organizations and REITs tied to provider organizations, including expanded material change notices and registration reporting. It adds transparency; it does not replace the ownership rules.

Massachusetts limits the entities a physician may practice through and requires licensed owners of a professional corporation. Chapter 343 of the Acts of 2024 then adds state oversight of investors and MSOs.

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The law in Massachusetts

Key authorities (official text)

243 CMR 2.07(22) · M.G.L. c. 156A §§ 7, 9, 10 · Chapter 343 of the Acts of 2024

243 CMR 2.07 (practice of medicine) · c. 156A § 7 · § 9 · § 10 · Board of Registration in Medicine · CHIA

Massachusetts CPOM is Strict on Foundry's 50-state guide. Board rule 243 CMR 2.07(22) lists the business organizations a licensee may practice medicine through: a professional corporation under M.G.L. c. 156A, a nonprofit, a qualifying LLC or partnership, or a comparable entity formed in another state. A general business corporation is not on the list. Chapter 156A then requires licensed shareholders, a licensed majority of directors, and licensed officers. A physician-owned PC plus a fair-market-value MSA is the working structure.

Older vendor tables call Massachusetts relaxed because it has no single statute worded like California Business & Professions Code § 2400. The Board's 2012 rule closed that gap in practice: it names the permitted vehicles, and a lay-owned operating company is not one of them. Hospitals and licensed facilities may still employ physicians, which is why hospital employment is common in Boston without changing the rule for a startup.

Who may own a Massachusetts professional corporation

Rule	What it requires	What it means for you
c. 156A § 7	Board certificate that each incorporator, the president, any vice presidents, a majority of directors and each shareholder is licensed	The articles cannot be filed with a lay founder on the roster
c. 156A § 9	A majority of directors and all officers (other than treasurer, clerk, secretary and assistants) licensed in Massachusetts	Your physician owner holds the president seat; your CEO can serve as treasurer or clerk
c. 156A § 10	Shares go only to licensed persons and qualifying entities; transfers in violation are void	Investor equity sits in the MSO, never in the PC
243 CMR 2.07(22)	Lists the business organizations physicians may practice through	A Delaware C-corp cannot employ Massachusetts physicians to treat patients

What Chapter 343 of the Acts of 2024 adds

Chapter 343, "An Act enhancing the market review process," was signed January 8, 2025 and took effect April 8, 2025. It expanded Health Policy Commission, CHIA and Attorney General oversight to cover significant equity investors, management services organizations and health care REITs connected to provider organizations. Material change notices now reach more deals, and registered provider organizations report more about their affiliates. The law adds transparency on top of the ownership rules; it leaves the ownership rules in place.

Paper the MSA before you treat Massachusetts patients at scale. A transaction review or registration filing asks for the agreement, not a summary of it.
Percentage-of-collections management fees are harder to defend once a state agency reads them. A fixed or FMV-supported admin fee holds up better.
Tell your investors early. Ownership chains and investor information can be requested when a material change notice applies.
A physician PC owner who actually governs protocols is what both the Board and a reviewer expect to find.

How an MSO-PC works in Massachusetts

Form a Massachusetts professional corporation under c. 156A owned by a Massachusetts-licensed MD or DO. The MSO, often the Delaware operating company, provides non-clinical services under a written MSA at fair market value. Clinical revenue lands in the PC. Foundry forms that structure through MSO-PC formation ($15,000) and matches a friendly PC owner ($3,000/mo), the physician owner of your professional corporation.

Run the operating checks on CPOM compliance and compare neighbors on the CPOM 50-state guide: New Hampshire, Rhode Island, Connecticut and New York each have their own rules. Longer narrative: Massachusetts CPOM guide.

Massachusetts CPOM FAQ

Does Massachusetts have strict CPOM?

Yes. Foundry rates Massachusetts Strict. 243 CMR 2.07(22) lists the entities a physician may practice through, general business corporations are not on it, and c. 156A §§ 7, 9 and 10 require licensed shareholders, a licensed board majority and licensed officers.

Do I still need an MSO-PC in Massachusetts?

Yes for most venture-backed and multi-state models that treat Massachusetts patients. The PC holds the clinical practice; the MSO is paid fair market value for non-clinical services.

What did Chapter 343 of the Acts of 2024 change?

It expanded state oversight of private equity investors, MSOs and REITs tied to provider organizations, effective April 8, 2025. It adds transparency and review; the ownership rules stay the same.

How does Foundry help with Massachusetts CPOM?

MSO-PC formation is $15,000 one-time. A Massachusetts-licensed physician PC owner is $3,000/mo. Foundry is not a law firm.