If you intend to break off from an existing medical practice or health care organization and form a new physicians practice, you should give serious consideration to a California Professional Corporation or PC. The PC provides advantages to licensed professionals such as doctors, dentists, architects and engineers. The primary advantages of a Professional Corporation (PC) are the protections provided to owners of the Professional Corporation and advantages in the ability to offer and deduct many employment benefits.
Your options are basically a sole proprietorship, a partnership or a professional corporation. A sole proprietor is personally responsible and liable for all debts and liabilities associated with the entity. Partners are not only liable for the debts or liabilities of the partnership, they are “jointly and severally” liable. This means if one of the partners has more assets a creditor can target that single partner instead of pursuing each partner for their fair share of the debt or liability.
For example, owners of the Professional Corporation are protected from the liability, malpractice or negligence of another co-owner or partner in the practice. If one physician is sued for individual malpractice, the other doctors in the PC are not responsible for any associated damages or liabilities. Physicians and licensed professionals are able to contribute more to retirement vehicles such as a 401(k) than in traditional forms of business entities such as a corporation or LLC, and may provide and deduct high ticket benefits such as health care and some professional fees.
The attorneys at the Watkins Firm have decades of experience and expertise in medical business and the laws associated with forming, owning, operating and ultimately selling a health care related company. We help you to maintain compliance with a host of federal, state and local laws and regulatory issues. We invite you draw on our deep experience and knowledge in the formation of your new physicians practice and contact the Watkins Firm or call us today for a complimentary and substantive consultation at 858-535-1511.