“Ghosting” used to mean disappearing on someone. In the world of medical spas and weight-loss clinics, state legislators and regulators have started using the same word for something else: a “ghost medical director,” a physician who lends a license and a name to a business he or she has never actually supervised, and rarely, if ever, visits. In fact, the physician might have done nothing other than collect a check.
The reality is that ghost magical directors have existed as long as family clinics have operated in retail locations and spas have claimed to be “medical”. Yet for decades, legislatures and, certainly, regulators, have pretended not to see it.
Now it appears that states are done pretending. Here are two examples, one from the regulatory world and the other from the legislative.
Earlier this year, New York’s Department of State, working with the Department of Health, the State Education Department, and New York City’s own oversight office, wrapped up a statewide sweep of more than 200 medical spas. Eighty-seven were cited. Among the most common findings: unlawful practice of medicine. Consequences ranged from fines to suspension to revocation to, in some cases, criminal referral.
In May, Georgia’s Composite Medical Board announced a regulatory priority through a “position statement” on arrangements between physicians and advanced practice nurse-owned entities providing IV hydration or IV therapy services. Specifically targeted are models in which a physician is contracted (translation: paid) to essentially lend the required medical license, because the physician provides no genuine oversight of clinical affairs.
Legislative action tied to faux oversight occurred in at least five other states within the last year and a half.
The Ghost and the Matchmaker
Legislatures and regulators examining medical spas and similar clinics, often focus on two types of physician involvement, or, better said, physician uninvolvement.
One is known by the ghost moniker mentioned above. Essentially, that’s a physician who is designated as medical director but who does none of the things a medical director usually does. In other words, there’s no real involvement in developing protocols, there’s no chart review, there’s no staff training, there’s really no documented oversight of any kind. Regulators easily see through the signature, license number, and evidence of a monthly check.
The second has a clever name as well, the “matchmaker”. As the name indicates, the matchmaker is a a third-party brokerage that, for a fee, pairs physicians looking for supplemental income with spas and other clinics, for example, weight loss clinics dispensing GLP-1s, that need a licensed name on a filing. The transaction is the whole relationship. Nobody involved expects the physician to actually set foot in the building.
Consider a fictitious a dermatologist, we’ll call her Dr. Clear, with a busy, legitimate practice. A matchmaking broker offers her $2,500 a month to be the named medical director for three unaffiliated weight-loss and aesthetics clinics across two counties, none of which she’s ever visited. She reviews no charts and trains no staff. She doesn’t even know who supplies one clinic’s botulinum toxin until a state investigator calls to ask about it. Her name, not the clinic owner’s, is on the pharmacy license and the placard in the front window.
Here’s what makes this different from the federal compliance problems I usually write about. This isn’t a False Claims Act case working its way through a U.S. Attorney’s office over several years. It’s a state medical board or perhaps a pharmacy board proceeding, and boards move fast. Many can suspend a license on an interim, emergency basis while an investigation is still pending, well before or avatar Dr. Clear gets anywhere near a hearing on the merits. The exposure isn’t a subpoena someday, but, potentially, her ability to practice medicine at all, potentially within weeks.
Some Timely Takeaways for You
- If you’re the “medical director” of a facility you’d need directions to find, that’s your answer already. Real oversight means documented chart review, protocol involvement, and staff training you could actually describe under oath.
- A broker offering to match you with a spa or other clinic for a monthly fee is not doing you a favor. Georgia has already made this exact arrangement illegal outright. Assume your state is watching the same trend.
- Learn your state’s specific medical director statute before you sign, not after a board investigator calls. The requirements vary sharply, and “I didn’t know my state had one” won’t persuade a hearing officer.
- Your name on the license makes you responsible for what the clinic is actually administering, not just its paperwork. Verify the drug supply chain, particularly for compounded GLP-1 products, before you agree to answer for it.
- An interim suspension can happen before you’ve had a real chance to respond. Get counsel to review the arrangement now, while you still have the leverage to walk away or renegotiate, not after the notice arrives.
Ghosting a date leaves someone annoyed. Ghosting a medical directorship can leave you without a license.
If you’d like a compliance review of your medical directorships or other clinic arrangements, let me know.
