Introduction
Over the previous decade, personal fairness companies and different well-funded company entities together with hospitals and insurers have expanded their presence in doctor practices throughout the nation. In 2024, hospitals and company entities employed virtually 80% of physicians. A rising physique of proof means that company possession constructions prioritize monetary positive factors over affected person care, undermine doctor autonomyand improve well being care spending. Policymakers are more and more grappling with the way to regulate the rising company funding in doctor practices.
Oregon has emerged as an early instance of how states can confront this problem. In recent times, the state has enacted reforms concentrating on each the company apply of drugs and oversight of well being care transactions. Collectively, these insurance policies kind a multi-pronged technique to restrict company affect over doctor practices and shield sufferers from the potential harms of consolidation.
Strengthening Company Follow of Drugs Legal guidelines
Company apply of drugs (CPOM) is a authorized doctrine primarily codified in statute, requiring that licensed physicians and different clinicians personal for-profit medical practices. Its goal is to make sure that licensed clinicians—not company actors—retain final authority over scientific and operational choices affecting affected person care. The doctrine displays considerations that company revenue motives might battle with clinicians’ moral responsibility to prioritize affected person care.
Extra lately, firms have developed workarounds that allow de facto management over doctor practices, most notably via the “pleasant doctor mannequin.” Beneath this strategy, a lay company—similar to a personal equity-owned firm—creates a separate entity generally known as a administration companies group (MSO) that positive factors management over the doctor apply’s belongings and installs an affiliated doctor because the nominal proprietor of the apply. The MSO-affiliated doctor might don’t have any energetic scientific position on the apply or stay out of state. The MSO then enters administration companies preparations with the apply to successfully acquire full operational and administrative management.
These preparations invert CPOM’s supposed relationship between the apply and the MSO. Moderately than functioning as a vendor supporting a physician-owned apply, the MSO has full management over the apply. This dynamic dangers undermining doctor autonomy and limiting physicians’ means to lift considerations about administration choices affecting affected person care. In consequence, researchers have more and more scrutinized the pleasant doctor mannequin as a mechanism for oblique company management, and state curiosity round amending CPOM legal guidelines to manage the pleasant doctor mannequin have additionally grown.
In 2025, Oregon handed one of many most complete CPOM legal guidelines within the nation by prohibiting the “pleasant doctor” mannequin. The regulation bans MSOs or anybody they contract with from having majority management or possession over a apply or exercising final management within the doctor apply. The statute additionally bars inventory restriction agreements and renders many noncompete, nondisclosure, and nondisparagement clauses unenforceable. By combining these possession and contractual restrictions, Oregon’s regulation restrains MSOs and goals to revive the spirit of CPOM. Nevertheless, the regulation didn’t create an enforcement authority inside state businesses and might solely be enforced via personal proper of motion.
Transaction Oversight
Transaction oversight permits states to watch and overview mergers, acquisitions, and different possession adjustments amongst well being care entities. States vary from having no oversight authority or pre-transaction overview authority to having complete oversight frameworks that embody transaction approval and post-transaction monitoring to guard sufferers and communities. Lately, states have expanded their oversight authority. A 2024 publication discovered that 13 states had transaction approval authority. By late 2025that quantity had grown to 32. These mechanisms are supposed to make sure that consolidation and funding don’t undermine affordability, high quality, or entry to care.
In 2021, Oregon handed some of the complete transaction oversight frameworks within the nation. Not like most states, Oregon requires pre-transaction notification and approval for sure transactions involving doctor practices that exceed a specified income threshold. Regulators overview the potential affect of those proposed transactions on client prices, high quality, entry, and fairness. The regulation additionally offers regulators post-transaction oversight authority, permitting the state to watch transactions after they shut and implement circumstances designed to guard affordability, entry, high quality, and fairness. If the entities are discovered to be out of compliance with any circumstances of approval, regulators can pursue authorized treatments.
Oregon’s CPOM reforms work along with the state’s transaction oversight authority, forming a multi-pronged technique to restrict company affect within the supply of well being care companies. Beneath the state’s transaction oversight frameworkthe Well being Care Market Oversight (HCMO) program might deny a fabric change transaction topic to overview if there’s a substantial chance it will violate the regulation. Accordingly, if a transaction entails a pleasant doctor association that violates the strengthened CPOM regulation, HCMO has the authority to disclaim approval.
Wanting Ahead
Oregon’s strengthened CPOM provisions take impact on a staggered timeline. The regulation turned efficient in January 2026 for MSOs and doctor practices shaped after June 2025. Present MSOs and doctor practices shaped earlier than June 2025 should comply starting in 2029.
Early trade actions are testing how the brand new regulation is interpreted. For instance, PeaceHealth lately determined to switch its long-standing emergency division doctor group, Eugene Emergency Physicians, with Lane Emergency Physicians. The brand new apply is solely owned by an Illinois doctor affiliated with ApolloMD, a Georgia-based MSO that additionally serves as Lane Emergency Doctor’s MSO. Legislative and gubernatorial scrutiny have adopted. Oregon lawmakers have requested for data to find out whether or not the association complies with the strengthened CPOM regulation and requested the events submit the transaction for overview. On the identical time, Eugene Emergency Physicians filed a lawsuit in opposition to PeaceHealth, ApolloMD, and Lane Emergency Physicians, alleging the brand new association depends on the pleasant doctor mannequin that the up to date CPOM regulation prohibits.
Oregon’s expertise may present necessary insights for different states searching for to curb company affect in well being care. Particularly, monitoring how the CPOM reforms work together with the state’s transaction oversight framework will assist assess whether or not these insurance policies safeguard doctor autonomy, restrain prices, and shield sufferers.
