HB 1675
In CommitteeHouse
Corp. practice of medicine
Concerning the corporate practice of medicine.
This status may be delayed. See Action History below for the latest updates.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill strengthens Washington’s ban on the corporate practice of medicine by preventing unlicensed individuals or entities from owning or controlling medical practices or interfering with clinical decisions. It requires licensed providers to retain majority control of professional service corporations and explicitly prohibits non-licensed managers—including those at management services organizations (MSOs)—from influencing clinical judgment, scheduling, billing, staffing, or other operational decisions that affect patient care. The bill also adds violations to the list of unprofessional conduct and requires providers to confirm awareness of these rules during license renewal.
- Prohibits unlicensed individuals or entities (including corporations and management services organizations) from owning, controlling, or managing medical practices or interfering with clinical decision-making by licensed providers.
- Requires that licensed health care providers hold majority ownership, board control, and key leadership roles (except secretary and treasurer) in professional service corporations used to operate medical practices.
- Bars non-licensed individuals from influencing or controlling clinical decisions—including patient scheduling, diagnoses, coding, treatment plans, staffing, billing, pricing, and contracts with insurers—even indirectly through policies, contracts, or employment pressure.
- Adds specific prohibited conduct (e.g., setting provider schedules as discipline, limiting clinical options in electronic records) to the list of unprofessional conduct for license holders.
- Requires all licensed health care providers in Washington to attest during license application or renewal that they understand the new corporate practice of medicine rules.
- Applies prohibitions to multiple licensed settings, including hospitals, nursing homes, birthing centers, hospice agencies, ambulatory surgical facilities, and private residential facilities.
Who is affected
- Health care providers and licensed professionals — Medical professionals (e.g., physicians, nurse practitioners) must ensure their practices are structured so that licensed providers—not corporate entities—maintain control over clinical decisions, staffing, and operations. They must also affirm awareness of these rules during license renewal.
- Health care facilities and their management — Hospitals, nursing homes, birthing centers, hospice agencies, and other licensed facilities must ensure that unlicensed managers or corporate owners do not interfere with clinical decisions made by licensed providers on staff.
- Corporate owners and investors in medical practices — Business owners or investors who previously owned or controlled medical practices through management services organizations (MSOs) or similar structures may no longer influence clinical decisions or operational control of medical practices.
- Patients receiving medical care — Patients may benefit from increased assurance that clinical decisions are made solely by licensed providers, without corporate interference affecting care quality or access.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (5)
By ensuring licensed providers retain majority ownership, board control, and authority over staffing, scheduling, and billing, the bill reduces the risk that corporate owners will prioritize profits over clinical judgment—e.g., by pressuring providers to see more patients or limit diagnostic testing—thereby improving patient safety and care quality.
Public SafetyPeopleRef: Sec. 1(2) & (5)(b)(i), (iii), (vii)Explicitly prohibiting unlicensed managers from influencing clinical decisions—including patient admission status, discharge timing, and available treatment options—protects patients from corporate-driven rationing and ensures that medical decisions remain clinically driven, not financially motivated.
HealthcarePeopleRef: Sec. 2–7 (hospital, nursing home, etc. prohibitions)Requiring majority shareholders to be physically present and substantially engaged in care delivery prevents absentee corporate owners from extracting profits without accountability, aligning financial incentives with clinical outcomes and reducing the risk of under-staffing or service degradation.
HealthcarePeopleRef: Sec. 1(3) & (5)(b)(ii)Classifying corporate interference in clinical judgment as unprofessional conduct strengthens provider autonomy and gives licensing boards clear authority to discipline providers who comply with corporate mandates that compromise care—supporting ethical practice and professional integrity.
Rights & LibertiesPeopleRef: Sec. 8 (adding new subsection (27))By broadly prohibiting unlicensed entities—including MSOs—from controlling or influencing any aspect of clinical operations (e.g., scheduling as discipline, record configuration limiting clinical options), the bill directly protects patients from systemic overreach by for-profit health systems that may otherwise coerce providers into unsafe or unnecessary care patterns.
HealthcarePeopleRef: Sec. 1(1) & (5)(a)
Potential Concerns (5)
The requirement that licensed providers hold all officer positions (except secretary and treasurer) in professional service corporations may limit operational flexibility and prevent qualified non-licensed professionals (e.g., experienced healthcare administrators) from serving in key leadership roles, potentially hindering efficiency and growth of small medical practices.
Business & EmploymentRef: Sec. 1(2)(c)Prohibiting providers from delegating pricing or billing decisions—even to licensed business managers—may prevent practices from optimizing revenue cycles and negotiating effectively with insurers, increasing administrative burden and financial risk for small practices lacking in-house business expertise.
Business & EmploymentRef: Sec. 1(5)(a) & (b)(viii)Adding corporate practice violations to the list of unprofessional conduct exposes licensed providers to disciplinary action—including license suspension—for actions they may not fully control (e.g., corporate contracts signed by co-owners), raising due process concerns for individuals in shared-ownership structures.
Rights & LibertiesRef: Sec. 8 (adding new subsection (27))The ban on transferring or relinquishing control over share sales or dividends may prevent providers from raising capital or exiting practices through standard business transactions, reducing liquidity and flexibility for small practice owners seeking to sell or merge.
Business & EmploymentRef: Sec. 1(4)(c)Mandating attestation of awareness of corporate practice rules during every license renewal imposes administrative costs and potential confusion, especially for providers in non-clinical roles or those who have practiced under prior, less restrictive interpretations of the law.
EducationRef: Sec. 9–31 (attestation requirements)
Who Is Most Affected
Providers in small or independently owned practices gain stronger legal protection against corporate coercion and can more confidently resist profit-driven mandates, but may face increased administrative burden and reduced flexibility in structuring partnerships or capital raises.
Large hospital systems and MSOs that have structured ownership to centralize control over clinical operations (e.g., setting provider schedules, configuring EHR to limit orders) will face significant operational restructuring and potential revenue disruption, while smaller facilities may benefit from reduced competitive pressure from corporate chains.
Corporate investors and private equity firms that have used MSO structures to control medical practices will lose the ability to extract value through management fees or operational control, directly reducing their returns—especially in states like Washington where such structures were previously common.
Patients benefit from reduced risk of corporate interference in clinical decisions—such as forced early discharge, limited diagnostic options, or scheduling-based discipline—which improves care quality and trust in providers; however, some may face reduced access if practices become financially strained due to operational constraints.