What are 'Studio Management Businesses' in the context of Degree Wellness franchises?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
In certain cases, where permitted by law, we may offer franchises to persons or legal entities that meet our qualifications but are not licensed to practice or provide health care, and are willing to undertake the investment and effort to own and operate a business that will manage a Studio franchise under the System; we refer to these businesses as "Studio Management Businesses." For example, certain states do not permit non-licensed persons to own and/or operate health care practices, but some states do. In states that do not permit non-licensed persons to own or operate businesses providing health related services, a Studio Management Business may be offered. In states that do permit non-licensed persons to own and operate businesses offering health care services, a Studio Management Business Franchise is not necessary, but may be offered by us under certain circumstances.
To operate a Studio Management Business, you must enter into a Franchise Agreement with us and a Management Agreement with a "Licensed Provider" that will own and operate the Studio. A general form of a Management Agreement, to serve as a starting point for satisfying this requirement is attached as Exhibit F-1, but the actual Management Agreement to be used must be approved by us, in our discretion, and must satisfy all requirements and limitations of applicable laws, rules, and regulations of the state in which the Studio Management Business will be located. Attached as Exhibits F-2 and F-3, are forms of agreement required if you utilize our preferred licensed provider. A "Licensed Provider" will be one or more licensed individuals, or a professional corporation or similar entity, such as a professional limited liability company, that is duly authorized to provide health care services under local and state laws. Pursuant to the Management Agreement a Licensed Provider will provide a good faith exam. The initial good faith exam will establish the patient/physician relationship and create a plan of care as it relates to the IV therapy. Then the IV is administered by a registered nurse that is supervised by the physician. The individual franchisees will provide nursing staff to the professional corporation through a staffing agreement where the physician provides supervision to the nursing staff and the franchisee handles all payroll services for the nurse. Also, pursuant to the Management Agreement franchise will provide payroll services, accounting and tax filing services, and other administrative services as the professional corporation directs. The professional corporation will collect all funds for medical services.
Source: Item 1 — The Franchisor and any Parents, Predecessors, and Affiliates (FDD pages 9–12)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, a 'Studio Management Business' refers to a franchise ownership model designed for individuals or entities who may not be licensed to provide healthcare services themselves, but who wish to own and operate a Degree Wellness studio. This model is particularly relevant in states that have corporate practice of medicine laws, which restrict non-licensed individuals from owning facilities that offer medical services like IV hydration and IM injections.
In states where such restrictions exist, Degree Wellness may offer a franchise opportunity to a non-licensed individual or entity under the 'Studio Management Business' framework. In this arrangement, the Studio Management Business owner enters into a franchise agreement with Degree Wellness and a separate Management Agreement with a 'Licensed Provider.' The Licensed Provider, which could be a licensed individual or a professional corporation, is responsible for the actual operation and provision of healthcare services within the studio.
The Management Agreement outlines the responsibilities of both the Studio Management Business owner and the Licensed Provider. The Studio Management Business typically handles administrative tasks such as payroll, accounting, and tax filing services, while the Licensed Provider ensures that all medical services are provided in accordance with state and local laws. Degree Wellness must approve the Management Agreement to ensure compliance with its standards and legal requirements. This structure allows individuals without healthcare licenses to invest in and manage a Degree Wellness studio while adhering to all applicable regulations.