Is the Management Company permitted to engage in Studio Services or activities that constitute the practice of medicine under the Degree Wellness agreement?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
- 7.2 Management Company shall not be permitted or required to engage in the Studio Services and/or any activities that constitute the practice of medicine, so long as applicable laws
and regulations prohibit the same. Any delegation of authority by Licensed Provider to Management Company that would permit or require Management Company to practice medicine or other Studio Services at the Premises shall be prohibited. Nothing in this Agreement shall be construed to permit the Management Company to control, influence, or otherwise affect Licensed Provider's rendering of the Studio Services and any provision of this Agreement which may be interpreted or deemed to constitute Management Company's practice of medicine shall be null, void, and of no force and effect, and such invalid or unenforceable provision will be reformed and construed by limiting it so as to be valid and enforceable to the maximum extent compatible with, and possible under, applicable law.
- 7.3 THE PARTIES HAVE MADE ALL REASONABLE EFFORTS TO ENSURE THAT THIS AGREEMENT COMPLIES WITH ANY APPLICABLE STATE LAWS AND REGULATIONS THAT PROHIBIT THE CORPORATE PRACTICE OF MEDICINE MEDICINE AND FEE-SPLITTING, AND THE PARTIES HEREBY UNDERSTAND AND AGREE THAT THEY WILL COMPLY WITH ANY CHANGES TO SUCH LAWS DURING THE AGREEMENT TERM. LICENSED PROVIDER SHALL HAVE THE EXCLUSIVE CONTROL AND AUTHORITY OVER THE PRACTICE OF MEDICINE MEDICINE.
- 7.4 MANAGEMENT COMPANY SHALL HAVE NO CONTROL OR DIRECTION OVER THE NUMBER, TYPE, OR RECIPIENT OF PATIENT REFERRALS MADE BY LICENSED PROVIDER AND NOTHING IN THIS AGREEMENT SHALL BE INTERPRETED AS DIRECTING OR INFLUENCING SUCH REFERRALS. NONE OF MANAGEMENT COMPANY'S SERVICES HEREUNDER SHALL CONSTITUTE OBLIGATIONS OF MANAGEMENT COMPANY TO GENERATE PATIENTS TO LICENSED PROVIDER.
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 63–66)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, the Management Company is generally prohibited from engaging in Studio Services or activities that constitute the practice of medicine, as long as applicable laws and regulations prohibit such activities. The Licensed Provider retains exclusive authority and control over the practice of medicine at the studio, including treatments, diagnosis, policies, and ethical determinations. The Licensed Provider also has the discretion to choose medical equipment and devices used in providing Studio Services.
Any delegation of authority by the Licensed Provider to the Management Company that would allow the Management Company to practice medicine or other Studio Services at the premises is explicitly prohibited. The agreement specifies that nothing within it should be interpreted to allow the Management Company to control, influence, or otherwise affect the Licensed Provider's rendering of Studio Services. Any provision that might be seen as allowing the Management Company to practice medicine is considered void and will be reformed to ensure compliance with applicable law.
Degree Wellness emphasizes that the agreement is structured to comply with state laws and regulations regarding the corporate practice of medicine and fee-splitting. The parties agree to comply with any changes to these laws during the agreement term. The Management Company has no control or direction over patient referrals made by the Licensed Provider, and its services do not include generating patients for the Licensed Provider.