How a med spa built inside one entity gets separated before it becomes a board complaint.

A single-site med spa opens as one limited liability company owned by a non-clinical founder. It sells facials and skin care alongside neurotoxin and filler injections, a hormone program supplied by a compounding pharmacy, and two laser devices. A physician is engaged as medical director on a monthly stipend calculated as a share of treatment revenue. A nurse injector performs most of the procedures. Memberships bill monthly and auto-renew.

Nothing about that is unusual and none of it announces itself as a problem. Four separate things in it are, and they surface together — usually when the business tries to add a second site, take outside money, or answer a complaint.

The single entity is the first problem. Skin care under the Cosmetic Art Act at Chapter 88B can sit in an ordinary company. Injectables, prescription therapies and procedures that alter tissue are the practice of medicine, and the Medical Board’s position, amended September 2025, is that a business practicing medicine in North Carolina must be owned in its entirety by holders of active North Carolina licenses, or by one of the combinations G.S. 55B-14 permits. One entity holding both puts non-clinical ownership on top of clinical services.

The medical director’s compensation is the second. The Board’s position statement on referral fees and fee splitting, amended September 2021, treats revenue sharing on a percentage basis between a licensee and a non-licensee as fee splitting unless state law permits it.

The supervision chain is the third. It exists in practice and not on paper: no written protocols per procedure, no training and competency records for the injector, and nothing showing how the supervising clinician is reached during a treatment.

The memberships are the fourth. G.S. 75-41 requires the renewal clause and the means of canceling to be disclosed clearly and conspicuously, and where the automatic renewal period itself runs longer than sixty days it adds a written notice to the consumer at least fifteen but no more than forty-five days before the renewal date. A violation renders the automatic renewal clause void and unenforceable.

The order matters. The service list decides the structure, so it is written down before any entity is formed, and the advertising is read last because it can only be reviewed against what the business is by then actually permitted to do.

Every step above is ordinary drafting when it is done in advance. The same work done during a board inquiry, a purchase agreement or an investor’s diligence is the same drafting under a deadline set by someone else, and an issuance or transfer of clinical shares in violation of G.S. 55B-6 is void rather than merely disputed — which is a harder thing to fix in the middle of a transaction than before one.

The firm scopes this as a fixed fee, because the service list tells you the size of the job before the work starts.