Congressional Democrats Propose First Federal Corporate Practice of Medicine Law; Unlikely to Pass

On September 16, 2026, Democratic Sens. Elizabeth Warren of Massachusetts and Ron Wyden and Jeff Merkley (both of Oregon) introduced the Stop Corporate Takeovers of Physicians Act of 2026,¹ with a companion bill (HR 10444) introduced in the House by Oregon Rep. Val Hoyle and other Democratic co-sponsors.² If enacted, the bill would establish the first federal corporate practice of medicine (CPOM) restriction in the country, imposing a national ownership prohibition on entities that are not owned by licensed providers (defined to include physicians and advanced practice providers such as physician assistants and nurse practitioners), sweeping new restrictions on management services organizations (MSOs), and a multilayered enforcement framework. The bill is modeled after Oregon’s 2025 revised CPOM statute, discussed here, one of the most restrictive CPOM laws in the country.³

Over 30 states have CPOM restrictions in place prohibiting nonlicensed individuals and entities from owning or controlling medical practices, although enforcement varies significantly across jurisdictions. Certain states, such as California and Oregon, have recently enacted legislation strengthening their state CPOM laws,⁴ and the trend is likely to continue. There has also been increased enforcement of CPOM laws, particularly in California, as discussed here.

Key Provisions

As introduced, the Stop Corporate Takeovers of Physicians Act of 2026 would make it unlawful for any partnership or corporate entity that is not majority-owned and controlled by licensed providers to

1. own or control a medical practice;
2. employ or enter into a contract for the provision of professional services with licensed providers; or
3. practice medicine, unless the entity is majority-owned and controlled by licensed providers.⁵ Nonprofit and public healthcare providers, hospitals, hospital-affiliated clinics, critical access hospitals, and rural emergency hospitals would be exempt.⁶

Additionally, the bill prohibits an MSO, its shareholders, directors, officers, employees, or contractors from⁷

• owning or holding any interest in, or serving in any governance role at, a medical practice;
• acquiring or financing the acquisition of a medical practice’s shares or assets;
• controlling or restricting the transfer of a medical practice’s ownership interests;
• exercising de facto control over hiring, compensation, staffing levels, scheduling, clinical standards, billing, payer contracting, revenue targets, or pricing decisions of a medical practice; or
• advertising a medical practice’s services under any name other than the practice’s own.

Any agreement between an MSO and a medical practice would need to be negotiated through legal counsel at arm’s length, and any compensation paid to the MSO for management services would need to be consistent with fair market value as determined by the Federal Trade Commission.

Any arrangement violating these requirements would be considered void and unenforceable as against public policy.⁸

The bill also bans noncompete agreements for licensed providers (with a narrow exception for physician-owners holding 25% or more of a practice) and broadly voids nondisclosure and nondisparagement agreements between licensees and MSOs or healthcare providers.⁹

The Legislative Outlook

The bill does not appear to have a realistic chance of being passed by the current 119th Congress. As the Stop Corporate Takeovers of Physicians Act of 2026 is exclusively sponsored by Democrats, the bill is unlikely to progress in the current Republican-majority Congress. Even in future Congresses, such a bill would face an uphill climb to passage. Furthermore, the bill stays high level and would create much confusion if passed, indicating that the sponsors’ focus may have been more on releasing draft legislation on this topic rather than actual passage in the near term.

Sidley’s Healthcare team will continue to monitor the Stop Corporate Takeovers of Physicians Act of 2026 and state CPOM developments. Please contact the authors or your regular Sidley contact to discuss the implications of this bill.

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¹S__ Stop Corporate Takeovers of Physicians Act of 2026, 119th Cong. (2d Sess. 2026) [hereinafter the Act], https://www.warren.senate.gov/wp-content/uploads/2026/09/Stop-Corporate-Takeovers-of-Physicians-Act-for-circ.-2026.pdf.
²HR 10444, 119th Cong. (2d Sess. 2026), https://www.congress.gov/bill/119th-congress/house-bill/10444.
³Press Release, Sens. Elizabeth Warren, Ron Wyden, and Jeff Merkley et al., Warren, Hoyle, Wyden, Merkley, Ocasio-Cortez, Subramanyam Introduce Bill to Ban the Corporate Practice of Medicine (Sept. 16, 2026), https://www.warren.senate.gov/newsroom/press-releases/warren-hoyle-wyden-merkley-ocasio-cortez-subramanyam-introduce-bill-to-ban-the-corporate-practice-of-medicine/.
4Sidley, Oregon Revises Corporate Practice of Medicine Law: Implementing More Restrictions on Corporate Involvement in Medical Practices (June 12, 2025), https://www.sidley.com/en/insights/newsupdates/2025/06/oregon-revises-corporate-practice-of-medicine-law; Sidley, Newly Enacted California Law Formalizes Corporate Practice Restrictions (Oct. 8, 2024), https://www.sidley.com/en/insights/newsupdates/2025/10/newly-enacted-california-law-formalizes-corporate-practice-restrictions.
⁵Act § 2(a)(1), supra note 1.
⁶Id. § 2(a)(3).
⁷Id. § 2(b)(2).
⁸Id. § 2(b)(1).
⁹Id. § 2(b)(1)(A).