Who can own what
New York generally prohibits the corporate practice of medicine and of many other licensed professions, so a medical practice is usually owned by licensed professionals through a professional corporation, a professional limited liability company, or a registered limited liability partnership. Owners typically must be licensed in the profession the entity practices, and combining different professions in one entity is allowed only in limited ways. Investors without a license usually take part through a separate management services company that supports the practice under a contract. That contract must leave clinical control with the professionals and avoid fee arrangements that amount to sharing professional fees. Clinics and other facilities that need state licensure follow a separate approval process, often through the Department of Health, though mental health and addiction programs answer to other state agencies.
Steps that take longer than expected
Professional entities in New York are formed with the Department of State, but they often need a certification from the State Education Department first, depending on the profession. Limited liability companies, including professional ones, also face a newspaper publication requirement after formation that is easy to overlook. Once formed, the practice usually needs its own tax identification number, a group provider identifier, and enrollment with Medicare, Medicaid, and commercial plans, and payer credentialing can take a while. Shareholder or operating agreements should address what happens when an owner leaves, loses a license, or dies, since ownership generally has to stay with licensed professionals. Planning these steps in order avoids a gap between opening the doors and getting paid.
Planning the structure
We start with who will own the business, who will provide care, and where the money will come from. Then we look at whether a single professional entity is enough or whether a management company, a real estate entity, or a facility license is involved. We also review how compensation will flow among owners and referral sources, since that is where structural choices meet fraud and abuse rules. Healthcare entity formation decisions are hard to unwind later, so we explain the trade-offs before anything is filed. You leave with a recommended structure and an order of filings.
