Face Value
 Gentle Recovery: A med spa patient undergoes a "gentle wave" treatment to quickly reduce inflammation and redness after a procedure. |
Two and a half years ago, Brian Sidella was contemplating a career change when he tuned into an episode of Fox's extreme makeover show "The Swan."
An executive in the telecommunications industry at the time, Sidella was struck by the ravenous public appetite for cosmetic self-improvement that the show revealed. He thought of Florida's rapidly growing population of aging Baby Boomers and their desire to stay youthful-looking -- and wondered what sort of business opportunities it might create for him.
Online research introduced him to medical spas. Medi-spas, med spas or medical spas, as they are called, originated in California as facilities offering doctor-supervised cosmetic procedures, such as laser hair removal and Botox injections, to those with enough vanity and disposable income. Typically located in malls and shopping centers, the sites are more convenient and usually far more luxurious than the average doctor's office. "Within weeks of pulling down the information, I decided that I wanted to be in this industry," Sidella recalls.
Growth Projections ? Botox injections generated $2.4 billion in procedure fees in 2005. Treatment revenue will grow to $4.6 billion by 2010, earning suppliers an estimated $878 million. ? Approximately 3 million dermal filler procedures were performed last year, earning practitioners $1.3 billion and suppliers $442 million. By 2010, an estimated 9 million treatments will generate $3.5 billion for doctors and $1.3 billion for suppliers. |
Today, Sidella's Forever Young MedSpa in the Fort Lauderdale suburb of Cooper City is part of a $10-billion industry that is growing between 50% and 100% each year. Startup costs average around $750,000, but the typical med spa is a cash cow, generating about $10 million in revenue over just five years, industry experts say. Typical prices in Sidella's establishment: $350 for a "one-zone" wrinkle-removing Botox treatment, $1,700 for a package of five photo-facial treatments to minimize sun damage, and $2,000 for laser hair removal from a woman's legs or a man's back.
Florida's demographics have made the state the second-biggest medical spa market in the country after California. Solana Medspas CEO and co-founder John Buckingham has helped investors, including Sidella, set up eight franchises around the state and predicts he'll have another 100 locations statewide within the next five to seven years. The affluent Baby Boomers flocking here in droves aren't content to let nature take its course as they age, Buckingham says: "Boomer women don't want to look like their mothers. They've worked hard. They're at the top of their game. They don't want to age gracefully."
What's also made the Sunshine State attractive for med spa operators is a permissive legal and regulatory climate. For one, Florida is among only a handful of states that does not have a corporate practice of medicine law. Typically, those measures prohibit corporations and other non-medical entities from employing doctors -- in order to keep physicians out of situations in which they might have to put a company's economic interests ahead of a patient's needs.
In Florida, the lack of such statutes means that corporations and investors are free to invest in medical practices. Physicians own and operate some medical spas, but many are owned and run by businesspeople with no medical training who hire a physician to serve as the "medical director" of their spa.
The law requires physicians to supervise and control the actual medical practices. But lax regulations have helped spa operators find creative ways to offer both medical and non-medical procedures under one roof. And the loose regulations mean that the nature of the supervision varies greatly.
Physicians themselves may not be required, for example, to perform the procedures administered at the spa -- or even to be on-site while the spa is operating. Certified electrologists can't conduct laser hair removal unless a physician is on the premises. But physician assistants and advanced registered nurse practitioners may perform laser hair removal and give various injections under the physician's "indirect supervision" -- meaning the doctor must be reachable by phone but doesn't have to be on premises. Supervising physicians are required to post a schedule of their regular office hours and the hours they're not on-site.
Another issue is the types of doctors who serve as medical directors. Many medical spas prefer to contract the services of a plastic surgeon or dermatologist, since the specialties seem to fit the cosmetic services the spas offer. Any physician may perform most cosmetic procedures, however, and a host of doctors, ranging from emergency room physicians to gynecologists to pediatricians, has jumped at the chance to supplement the income from his or her regular practice by affiliating with a med spa. That is about to change. But it's unclear whether the change will make the spa treatments any better or any safer -- or whether it will just hand over the lucrative med spa procedures to a smaller group of physicians.
 Med Spa Opportunity: Brian Sidella (with wife Diana Santa Maria) got the idea to start Forever Young MedSpa in Cooper City after watching an episode of Fox's extreme makeover show "The Swan." In the show, no longer on the air, women received a cosmetic-procedure transformation and then competed to win cash and other prizes. |
Control issues
In May, Gov. Jeb Bush signed a law, House Bill 699, that limits the number of "satellite" offices a plastic surgeon or dermatologist may operate to one. (Physicians already operating two are grandfathered in and will be allowed to operate two until 2011.) The law, which took effect July 1, requires that the offices must be located within 25 miles of the physician's primary practice and that all satellite offices must be within 75 miles of each other.
More significant for the med spa industry, the law also states that only dermatologists or plastic surgeons may serve as medical directors of med spas. Some in the med spa industry say the change is a blatant move by plastic surgeons and dermatologists to corner the market on the lucrative med spa procedures, particularly Botox -- and kick other physicians off the gravy train. After all, they point out, other types of physicians may still perform Botox injections, medical microdermabrasion, chemical peels and laser treatments in their primary offices -- but House Bill 699 means they can no longer perform them at a med spa.
"It's a push by the dermatologists and plastic surgeons to control the industry in the guise of safety," says Eric Light, president of the International Medical Spa Association, which sent 200,000 e-mails unsuccessfully urging Bush to veto the bill.
Industry groups also complained that one of the legislation's co-sponsors, Rep. Eleanor Sobel (D-Broward), is married to Hollywood dermatologist Stuart Sobel and operates a skin care products company. She should have recused herself from the debate on the issue, the groups say. Sobel did not respond to requests for comment.
Florida state Rep. Joe Negron (R-Stuart), the original sponsor of the legislation, says he never intended to regulate the medical spa industry when he introduced the bill. That effect, he says, was merely one of several unintended consequences of legislation meant to enhance patient safety. "When I filed the bill, I had no interest in regulation of the medical spa industry, didn't know anything about the medical spa industry, and this is not a medical spa bill," Negron says.
Negron says he was worried that doctors, and dermatologists in particular, were juggling more offices than they could supervise and taking on more patients than they were capable of handling. Negron says one local dermatologist showed him files of patients who had been referred to dermatologists for treatment but never even saw one. Instead, they'd been treated solely by physician assistants and often never even realized it.
Labor Intensive Rudnick, who ran a chain of weightloss centers before getting into the med spa industry, says that finding qualified help is also so difficult that he plans to launch his own "MedSpa University," where he can "breed" future employees. If all goes well, he plans to open another Sleek location in Aventura Mall in the first quarter of 2007. He hopes to have 12 locations from Coral Gables to Palm Beach. Rudnick says that so far he hasn't been adversely affected by H.B. 699, but that's only because of the way his business is structured. The plastic surgeon affiliated with Sleek MedSpa independently owns and runs a medical corporation. Sleek, in turn, serves as a retail company that has a service agreement with that physician's medical corporation. He says the regulations won't pose any threat to his expansion plans. "We only work with plastic surgeons, and they benefit from this. If we have to have 12 plastic surgeons, so be it." |
"There was a Tampa doctor talking about opening a satellite office in Tallahassee," says Negron. "There are doctors with five, six, and -- particularly in the dermatology arena -- up to seven satellite offices. Could they actually supervise that many offices, and were they actually seeing patients?"
After the bill passed, Negron says he changed his mind after fully understanding the effect of the legislation on med spas but stopped short of asking Bush to veto the bill. He believes "that's something I think the Legislature next year should take a look at." A lawyer with Akerman Senterfitt, Negron dismissed suggestions that his firm's work on behalf of the Boston-based laser technology manufacturer Palomar had anything to do with his change of heart, saying that he has always kept his legislative work separate from his professional life.
Palomar, one of the largest makers of aesthetic laser equipment used for hair removal, tattoo removals and other cosmetic purposes, hired Akerman to help defeat Negron's legislation two days after the Florida House passed it.
Haphazard approach
Dr. Steven Rosenberg, a West Palm Beach dermatologist and chairman of the Florida Society of Dermatology's legislative committee, says the impact on medical spas was just "one small component" of a bill intended to give the board of medicine the responsibility to determine the appropriate levels of supervision for certain "physician extenders" like nurse practitioners and physician assistants -- a hotbutton issue that had been on the Florida Medical Association's radar for six years.
 TRICKS OF THE TRADE : Dr. Sharon McQuillan (right) owns Ageless Aesthetic Institute in Sarasota, where she trains others how to inject Botox and operate laser equipment. |
Nevertheless, Rosenberg believes any move to regulate the industry is probably a good idea. "Who knows what kind of sterile procedures they're providing, what kind of care they have for an emergency situation. The reality is medical spas didn't exist when most rules and regulations were developed, and now they sort of fall through the cracks," he says.
Sidella believes enforcement of existing regulations is haphazard. He says a new employee told him that a competing med spa was using aestheticians to perform Botox injections, in violation of Florida statute. When he called to report the incident to the Department of Health, he "got frustrated. They didn't want to hear it. They didn't even seem to know what a med spa was."
Moreover, members of the med spa industry argue, the Legislature could have taken more effective steps than limiting the field to plastic surgeons and board-certified dermatologists. For instance, if lawmakers were concerned about burns from laser hair removal, they might have required all physicians in the medical spa industry to be trained in intense pulsedlight technology and other types of aesthetic laser-procedures. Dr. Sharon McQuillan, who trains other physicians how to inject Botox and operate laser equipment at her Ageless Aesthetic Institute in Sarasota, says that discriminating against the type of doctors who can operate a med spa is counterproductive. "We have trained many anesthesiologists who are wonderful with a needle. If they can put a catheter in a baby's vein, they're pretty good at doing Botox," she says.
Dr. Steve Cimerberg, a family practitioner and licensed osteopath who runs the Advanced Medical Spa in Plantation, won't feel any repercussions from the new law because his spa is his primary practice, but the physician clients he teaches to use laser equipment might. Why limit med spas to just plastic surgeons and dermatologists, he asks, when "there are physicians from other specialties that are trained just as well or better."
McQuillan says that while H.B. 699 may prevent some chains from putting unsupervised personnel in "potentially harmful" situations, it didn't ensure that all med spas will deliver consistent and safe treatments. As a result, she is spearheading an effort to develop practice standards for the industry. McQuillan says she is working with the American Academy of Family Practitioners, the American Academy of Osteopathic Physicians, the American Academy of Ophthalmologists and a number of other organizations to establish a set of "best practices" for the light-based treatments and fillers, as well as competency requirements for practitioners that the state board of medicine could implement. "We want to standardize the way these procedures are offered, so practitioners can practice effectively."
For now, says Solana Medspas cofounder Buckingham, the only ones hurting financially in the medical spa industry are the gynecologists, family practitioners and others who will soon be shut out of the Botox gold mine. "I can't believe the doctors were caught napping in your state," he says.