By: Natalia R. Beltre and Gregory T. Measer
To safeguard patient care from corporate interference in clinical decisionmaking, New York maintains one of the strictest corporate practice of medicine (“CPOM”) prohibitions in the United States. Under New York law, medical services may be provided only by licensed medical professionals, by professional entities that are owned and controlled exclusively by licensed medical professionals, or by hospitals and other entities expressly authorized under the Public Health Law.
Unlicensed investors typically structure their investments around these restrictions through the management service organization (“MSO”) – friendly professional corporation (“PC”) model. Under this arrangement, a PC contracts with an MSO to handle non-clinical and administrative functions in exchange for a management fee. Because the MSO never delivers clinical care and its fee is not tied to clinical services, investors can profit from the practice without triggering CPOM or fee-splitting prohibitions. Private equity firms have leveraged this model aggressively, investing more than one trillion dollars in healthcare transactions over the past decade.1 This surge of investment has sparked a wave of legislative responses across the country.
Effective this year, California codified its CPOM doctrine and also imposed new reporting obligations on MSOs, private equity groups, and hedge funds involved in material healthcare transactions. Legislators in Illinois, Indiana, Massachusetts, Minnesota, North Carolina, Oregon, Vermont and Washington have either introduced or passed similar bills, seeking to codify
their own CPOM prohibitions, require notification of material transactions, or establish moratoriums on private equity investment in healthcare providers.
New York was ahead of many of these states. In 2023, New York enacted its own Material Transactions Notification Law, requiring certain healthcare entities to notify the New York State Department of Health (the “DOH”) at least thirty days before the closing of any material transaction that would increase its in-state revenue by $25 million or more.
Most recently, New York State Senate Bill S8442 proposes to further codify New York’s CPOM doctrine and, in doing so, reshape the boundary between physician control and outside investment. While the bill’s stated purpose is to safeguard medical decision making from nonphysician interference, its practical effect would be to replace New York’s existing blanket prohibition on non-physician ownership with a statutory framework that, for the first time, permits unlicensed individuals and entities to collectively hold a minority ownership stake in PCs organized to practice medicine.
Under the proposed framework, physicians licensed in New York must hold the majority of each class of voting shares, constitute a majority of the board of directors, and serve in all officer positions except for the secretary and treasurer. These thresholds represent a floor, not a ceiling, as the bill authorizes the DOH to require that physicians hold more than a majority of voting shares and occupy more than a majority of board seats. The bill also amends Section 1508 of the Business Corporation Law to expressly provide that directors and officers of a medical PC “may include individuals who are not licensed to practice medicine in any state,” so long as the majority-physician requirements are satisfied and the president, chairperson of the board, and chief executive officer are licensed physicians.
These ownership concessions, however, come with governance restrictions that would directly affect MSO-PC arrangements. The bill prohibits a PC from transferring control over its “administrative, business, or clinical operations” unless it first executes a
shareholder agreement for the benefit of its majority physician-shareholders. It also limits the removal of directors and officers to a majority vote of shareholders or directors, or termination for cause (including breach of fiduciary duty, license revocation, fraud, or malfeasance). The bill further prohibits retaliation against licensees who report suspected legal violations to an MSO, a hospital, or a government authority, even if the disclosure violates a nondisclosure or non disparagement agreement. It also carves out exceptions for nonprofit corporations serving medically underserved populations, federally qualified health centers, and certain rural health clinics.
If S8442 becomes law, direct minority ownership may reduce investors’ reliance on the MSO model entirely in New York. Existing MSO-PC arrangements may need restructuring to comply with the new governance and shareholder agreement requirements. Ultimately, New York is one of many states confronting the role of private equity in healthcare, underscoring the importance of a state-by-state compliance strategy for medical practices and investors alike.
If you have questions about these developments, please contact Gregory T. Measer (gmeaser@lippes.com), Natalia R. Beltre (nbeltre@lippes.com), or another one of our qualified Health Care Practice Team members at Lippes Mathias LLP.
Source: Michael D. Goldhaber, Private Equity and Healthcare: Balancing Profit with Wellness, New York University’s Stern Center for Business and Human Rights 1, 6 (March 2026), https://bhr.stern.nyu. edu/wp content/uploads/2026/03/N UCBHR- PE-and Healthcare_Mar-10-FINAL-1.pdf
The arrival of Dr. Jorge Romero as Section Chief of Cardiac Electrophysiology and Director of Cardiovascular Research and Innovation is a prime example of increased convenience and accessibility for patients, bringing cutting edge treatments directly into their community. Dr. Taub noted that she initially connected with Dr. Romero to refer a patient for a procedure that couldn’t be done locally.
“Instead of heating or freezing the tissue, we are creating small holes in the cell membrane, called electroporation. The beauty of this technology is that the cardiac muscle is uniquely sensitive. We only need a small dose of energy to eliminate the triggers for atrial fibrillation located in the pulmonary veins of the patient,” Dr. Romero said, which avoids damage to the smooth muscle of the esophagus, phrenic nerves, and other adjacent structures. This has eliminated the risk of atrial esophageal fistula, a deadly complication that used to happen in 0.2% of ablation cases, but which hasn’t occurred in the 800,000 cases of PFA that have been performed so far worldwide. This new, safer technology greatly benefits the older population, mostly over the ages of 70, who are most likely to suffer from atrial fibrillation, offering improved quality of life and reducing longterm risks. Dr. Romero successfully performed Upstate’s first ablation using the Affera Mapping and Ablation System with the Sphere-9 catheter, a multi-purpose catheter not found at any other facility in New York State outside New York city and Long Island.
“It’s less morbid; recovery is fast, and outcomes are very similar to open-heart surgery,” said Dr. Kalra. “Transcatheter techniques for the aortic valve are becoming the procedure of choice. Even patients who are at low risk for complications following open heart surgery are eligible for and favor the transcatheter heart valve due to significantly less morbidity following the procedure, and faster return to normal life.”
Foundational to cardiovascular care is cardiovascular imaging, which is used not only for visualizing and diagnosing cardiac disease, but also during interventional procedures. Under the guidance of Dr. Adeeb Al-Quthami, Director of Cardiovascular Imaging, significant investments in the latest technology have been secured for the benefit of Upstate’s patients.
“We can visualize the heart to a very high degree in terms of tiny detail,” he said. “If you try to take a picture of something that’s moving, it’s going to blur, especially if what you’re trying to take a picture of is small. With the advancements in technology, we can take a picture of the heart within a fraction of a heartbeat,” identifying patients’ unique anatomy and offering precise, personalized treatment for each patient.
Launched within the last year, AI assisted plaque analysis software, called HeartFlow, is now helping the Upstate cardiovascular team to better assess a patient’s risk for a future heart attack. Dr. Al-Quthami explained how this new technology offers improvement over the traditional coronary calcium scan.
By recruiting more cardiovascular experts to Upstate and continuing to invest in the innovative technologies they use, Dr. Tucker highlighted how the Upstate cardiovascular program is committed to staying at the forefront of cardiovascular care.
Clinicians hear it every day, stressed patients, and stressed staff. The pressures of changing systems, social media chatter, and a world that seems to be restructuring at every level.
When Melanie McNally, MD first began practicing urology, she didn’t anticipate developing a focus on urologic issues specific to women. However, about five years into her practice, she found many women were experiencing urologic health concerns that gynecology was illequipped to manage.
Stallone has held two unwavering truths: he wanted to be a physician, and he wanted to serve his country. Both were anchored by clear purpose.
He went on to earn both an MD and MBA simultaneously from the University of Pennsylvania, and later an MA in National Security Policy Studies from the U.S. Naval War College. He also serves as an Air Force Colonel and has been with the New York Air National Guard for more than 28 years, the past seven as the New York State Air Surgeon. These accomplishments reflect a career built on discipline, leadership, and a breadth of perspective informed by medicine, business, and service.
As his career evolved, Dr. Stallone stepped into health system leadership roles, including serving as a hospitalist, physician leader, and former health system CEO, gaining a broader view of how care is delivered and where it often breaks down. He saw firsthand the pressures facing providers, the operational realities behind clinical decisions, and the importance of aligning strategy with real world practice.
That belief drew him to Excellus BlueCross BlueShield (Excellus BCBS) well before his executive appointment. Through his involvement on the plan’s Central New York and Southern Tier regional advisory boards and governing board of directors, Dr. Stallone developed a deeper understanding of the organization’s nonprofit mission and its commitment to community-focused care. Just as important, he learned the value of listening. “You have to understand providers, the community, payors, and the people doing the work,” he says. “That’s how you design programs that actually make a difference.”
At the core of his vision is partnership. Drawing on his experience as both a physician and a former health system CEO, Dr. Stallone sees collaboration as the most effective path forward in an increasingly complex healthcare environment. He designs practical, sustainable, and impactful programs by grounding his strategy in the real challenges facing the healthcare system, including rising costs. 
Dr. Stallone envisions Excellus BCBS as a bridge-builder, bringing together providers, health systems, and community partners to solve problems collaboratively. His focus is on creating pathways that strengthen relationships, improve coordination, and deliver measurable improvements in care—all while staying true to the organization’s mission.
Before she became the President and CEO of HealtheConnections, Elizabeth Amato was young teacher in Charlotte, N.C., discovering that her true calling lay beyond the classroom. She felt pulled back to her time working in women’s health in an ambulatory care setting — a decision that would launch the next 20 years of her health IT career.
Amato started at HealtheConnections in January 2022 as Vice President of HIE Services and Operations. In January 2024, she rose to Senior Vice President and Chief Operating Officer. As CEO, she is leading the organization into its next chapter by prioritizing innovation, adaptability, and long-term planning.
“I’m proud of the work that this team has accomplished, and that in my first year as CEO we are able to bring this major project over the finish line and launch it,” Amato said. “It uses the latest technology offerings in the healthcare data industry, and it’s what we call “cloud-native”. It’s not dependent on legacy types of hardware and infrastructure. We’re using scalable and adaptable tools that are unique in our space. That’s going to allow us to be highly responsive to data requests from our participants, be able to offer better analyses, and much more.”
HealtheConnections continues to support patient-centric, value-based care, as well as develop the resources that enable better outcomes, efficiency, and affordability. Amato’s team is prioritizing the strategies and initiatives that support those goals not only locally, but statewide.
At one time, there were a dozen HIEs in New York; consolidations and mergers reduced that number to the current six. Amato believes it is currently more important than ever for HIEs to operate resourcefully and add value to a variety of stakeholders.
to know.”
She fosters an open workspace that allows her staff to feel comfortable sharing their ideas. “My role is two-fold—it’s providing information, and then being open to feedback and input from our staff, the incredibly smart people who work with us—all ideas are welcome.’”
and it’s going to continue. My commitment is to preserve the values that have brought us here, while bringing new ideas and 
As Central New York stands on the edge of historic investment and transformation, TDO is sharpening its focus on what comes next. As the region’s Manufacturing Extension Partnership (MEP) center and a nonprofit consulting and training organization based in Liverpool, TDO exists to grow the local economy by helping manufacturers and technology companies drive operational excellence and cultural transformation.
For the past 35 years, construction industry Association executives, myself included, and others have attempted to work with politicians in Albany to reform the antiquated New York State “Scaffold Law” (Labor Law 240), which imposes an absolute liability standard on gravity related injuries to workers – even when the worker is at fault. Generally, these cases are settled out of court between the plaintiff’s attorney and the very few insurance carriers which choose to take on this extraordinary risk exposure in New York. This unique and strict absolute liability standard does not exist in any of the other 49 states, where such gravity related injury claims and lawsuits are subject to a comparative negligence standard. The construction industry’s proposed reform does not take away one’s ability to sue if injured, rather the industry has for decades asked Albany politicians to amend the state’s outdated Labor Law, which was enacted in 1885, to eliminate the absolute liability standard and replace it with a comparative negligence standard.