The Texas Medical Board has adopted several new rules regarding the practice of medicine. 

New Rule 177.14 States:

(a)  Pursuant to §162.051 of the Act, a physician and an optometrist or therapeutic optometrist, may, organize, jointly own, and manage any legal entity, including a partnership, limited partnership, and limited liability company.

(b) The authority of each of the practitioners is limited by the scope of practice of the respective practitioners and none can exercise control over the other's clinical authority granted by their respective licenses, either through agreements, bylaws, directives, financial incentives, or other arrangements that would assert control over treatment decisions made by the practitioner.

New Rule 177.16 states:

(a) Corporations.









(b) Partnerships.










(c) Professional Associations and Professional Limited Liability Companies.










(d) All physicians and physician assistants who jointly own an entity must annually submit a joint form to the board providing date of formation of the entity, each licensee's ownership interest in the entity, proof of ownership, and proof of date of formation, along with required fees as provided in Chapter 175 of this title (relating to Fees and Penalties).

(e) Physician assistants who solely own an entity or jointly own an entity with a non-physician must annually submit a form to the board providing the date of formation of the entity, each person's ownership interest in the entity, proof of ownership, and proof of date of formation, along with required fees as provided in Chapter 175 of this title.

(f) Restrictions on ownership interests, shall apply only to those entities formed on or after June 17, 2011. However, if the ownership interests of an entity changes, then the restrictions on ownership shall apply to the entity.

(g) This section shall not apply to pain management clinics owned and operated pursuant to Chapter 195 of this title (relating to Pain Management Clinics).


Rule 177.17 now states:

(a) Corporate Practice of Medicine Doctrine. The corporate practice of medicine doctrine is a legal doctrine, which generally prohibits corporations, entities or non-physicians from practicing medicine. The prohibition on the corporate practice of medicine is based on numerous provisions of the Medical Practice Act, including §§155.001, 155.003, 157.001, 164.052(a)(8), (13), and 165.156. Section 165.156 of the Medical Practice Act makes it unlawful for any individual, partnership, trust, association or corporation by use of any letters, words, or terms, as an affix on stationery or advertisements or in any other manner, to indicate the individual, partnership, trust, association or corporation is entitled to practice medicine if the individual or entity is not licensed to do so.

(b) Applicability. Upon satisfaction of the requirements of their physician employment enabling statute and to the extent authorized by their enabling statutes, the following entities may employ a physician and retain all or part of the professional income generated by the physician for medical services provided at:








(c) Reports to the Board. To the extent required by their enabling statutes, entities permitted to hire physicians, shall appoint or otherwise ensure that a physician is selected to be the chief medical officer or member of a hospital district medical executive board, and the chief medical officer or members of the hospital district medical executive board shall report to the Texas Medical Board any action of event that they reasonably and in good faith believe constitutes a compromise of the independent medical judgment of a physician in caring for a patient. The Texas Medical Board may provide such reports to the Department of State Health Service and other regulatory agencies as necessary.

(d) Discontinuation of Eligibility. If an entity no longer meets the criteria to employ physicians, the entity must change its contractual relationships with physicians in order to establish an independent contractor relationship with the physicians.