Starting a medical practice is an exciting and rewarding journey that can transform your career and impact countless lives. With the right planning and attention to detail, you can build a thriving practice from the ground up. One of the most crucial first steps is to register a medical practice, and this blog will guide you through the process to make it as smooth as possible.
1. Choose a Business Structure
When starting your medical practice, it’s important to choose the appropriate legal structure. Medical practices often need to register as a Professional Association (PA) or a Professional Limited Liability Company (PLLC), depending on your state’s regulations. These structures are specifically designed for licensed professionals such as doctors, providing liability protection and tax benefits. The most common structures for medical practices include:
- Professional Association (PA): A legal entity specifically for licensed professionals, offering tax benefits and liability protection.
- Professional Limited Liability Company (PLLC): Similar to a regular LLC but tailored for licensed professionals, allowing for personal asset protection.
Before finalizing the business structure, consult a healthcare attorney to ensure that your selected entity aligns with both your state’s regulations and your long-term financial goals.
2. Register the Business Name
Once you have decided your business structure, you’ll need to register your practice’s name with your state’s Secretary of State office. Ensure that the name you choose is unique and aligns with your brand.
- Business Entity Name vs. Website Name: The business name will primarily be used for business-related activities such as opening a business bank account, writing checks, and filing taxes. However, the website name is what your patients will come to know and interact with. In many cases, it’s best to use your own name or a variation of it as your website name because patients often search for their doctor by name. This helps build a stronger connection with your patient base.
- Check Availability: Search your state’s database to make sure your desired name isn’t already taken.
- Register a DBA (Doing Business As): If you want to operate under a name different from your legal entity name, you may need to file a DBA. This will allow you to market your practice under a different, perhaps more patient-friendly, name.
3. Refer to your State Medical Board
The medical board plays a vital role in the establishment and regulation of medical practices. Understanding its involvement is crucial for new practice owners. Here are some key aspects of the medical board’s role in the process:
- Licensing and Certification: The medical board is responsible for issuing licenses to physicians and healthcare professionals. This ensures that only qualified individuals are allowed to practice medicine. Before opening your practice, you must verify that you hold the necessary licenses and certifications required in your state.
- Regulatory Compliance: Each state has its own set of laws and regulations governing medical practices. The medical board ensures compliance with these regulations to protect patient safety and uphold the integrity of the medical profession. They may require you to submit documentation, undergo inspections, or meet specific operational standards. Non-compliance can lead to hefty fines or even the closure of your practice.
- Name Approval and Branding: As mentioned earlier, the medical board oversees the naming conventions for medical practices. They review proposed practice names to ensure they comply with state regulations. This step is crucial as the name must reflect professionalism and avoid misleading implications about the services offered.
- Continuing Education and Training: The medical board often requires ongoing education and training for licensed professionals. This ensures that practitioners stay up-to-date with the latest medical advancements and maintain high standards of care. New practice owners must understand these requirements to ensure their staff remains compliant.
- Guidance and Resources: Many medical boards provide resources and guidance for new practice owners. This can include information on best practices, legal requirements, and resources for business development. Engaging with your local medical board can offer valuable insights as you navigate the complexities of starting your practice.
4. Obtain an EIN (Employer Identification Number)
An EIN, also known as a Federal Tax Identification Number, is required for tax purposes and will be used to identify your practice. It’s easy to apply for an EIN online through the IRS website, and it’s free.
Why You Need an EIN:
- To file federal taxes
- To open a business bank account
- To hire employees
The process is simple and can usually be completed online in less than 15 minutes.
5. Register for State and Federal Taxes
In addition to obtaining your EIN, you’ll need to register for any relevant state taxes. These may include:
- Sales Tax Permit: If your practice sells medical supplies or products.
- Payroll Taxes: If you have employees.
- State Franchise Taxes: Some states require businesses, including medical practices, to pay franchise taxes, which are a type of business tax imposed for doing business in the state.
- Personal Property Taxes: Depending on your location, you may also be required to pay taxes on business property like medical equipment or office supplies.
6. Obtain City or County Permits
In addition to state regulations, some states may require specific city or county permits to operate your practice. Make sure to check local regulations to stay fully compliant with all necessary permits before opening your doors. This may include:
- Zoning Permits: Ensure your medical practice is located in an area that is zoned for business.
- Building and Safety Permits: If you’re renovating or building out your office space, you may need building permits.
- Health Permits: In some cases, practices may need health department approval, particularly if providing certain types of treatments or procedures.
From Planning to Practice: Final Considerations
Launching your own medical practice is an incredibly fulfilling journey, but it requires careful attention to several essential details to ensure compliance and long-term success. From thoughtfully selecting the appropriate business structure and registering a unique, compliant name to collaborating with your state’s medical board and adhering to local regulations, you are laying the groundwork for a well-regulated, thriving practice. Additionally, you’ll need to consider insurance, bank accounts, asset protection, and more.
At ConsultingMDs, we handle all of these complexities – and much more. Our team makes starting a concierge practice easy, allowing you to focus on what matters most: your patients. Reach out today to learn how we can support you on this exciting journey.
