California has a specialized, highly regulated type of business structure in place for physicians who want to incorporate their professional practice. Known as a California Professional Medical Corporation, these types of businesses can often benefit by working with an outside business entity called a management services company or “MSO.” In this article, our San Diego healthcare law attorney explains the key things to know about the relationship between a California professional medical corporation and a management services company (MSO).
Know Your Terms: California Healthcare Law
Healthcare is a complex industry in California. Our state has a number of unique business regulations in place. Here are some key background things to know about these types of entities:
- California Professional Medical Corporation: Pursuant to a state law called the Moscone-Knox Professional Corporation Act, California medical professionals who want to incorporate their business must do so by forming a Professional Medical Corporation. There are strict rules in place on who can own shares of a medical corporation in California.
- Management Services Company (MSO): An MSO is a company that provides a wide array of business services—generally administrative and management services—to Professional Medical Corporations. Lay-persons (non-physicians) can own shares of an MSO.
How an MSO Can Work With a California Professional Medical Corporation
- Administrative Support: MSOs often provide administrative support to medical corporations, including accounting, billing and coding, human resources, IT support, and legal services. It can help the medical corporation streamline operations, reduce its administrative burden, and improve its overall efficiency.
- Non-Medical Services: An MSO can also provide certain on-medical services to the Professional Medical Corporation, such as marketing and advertising. These commercial services can be crucial in helping a medical practice attract new patients.
- Shared Resources: By working with an MSO, the professional practice can share resources. Indeed, in some cases, Professional Medical Corporations and MSOs can share things such as office space and equipment, thereby reducing total costs and improving efficiency.
- Greater Flexibility: MSOs allow professional medical practitioners to focus primarily on providing medical services. As the MSO can handle administrative and support functions, the medical professionals can focus on care and patient needs.
Consult With Our California Healthcare Law Attorney Today
At The Law Office of Kris Mukherji, our healthcare law attorney is an experienced legal advocate. If you have any questions about professional medical corporations and MSOs, we can help. Contact us today to arrange a fully confidential initial consultation. From our La Jolla office, we provide healthcare law services to businesses and entrepreneurs in San Diego and throughout the region.