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CalAttorney2
CalAttorney2, Attorney
Category: Business Law
Satisfied Customers: 10238
Experience:  I am a businesses law attorney, with experience advising and representing owners and investors.
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Can an LLC owned by a non physician contract with an

Customer Question

can an LLC owned by a non physician contract with an Physician or a PLLC for providing physician services
Submitted: 1 year ago.
Category: Business Law
Customer: replied 1 year ago.
IF they have physician as a medical director & not as a partner can they contract with other MD to do locums or provide services at a hospital not owned by the LLC ?
Customer: replied 1 year ago.
my dad ( BCOM ) wants to open an LLC and contract with a hospital to provide physician services ( kind of like a recruiter or locum ) as we know many physicians . some of them will have PLLC & some will be just individuals . Please inform me if there is any legal caveat or issue with this situation .
Expert:  CalAttorney2 replied 1 year ago.

Dear Customer,

Thank you for using our forum. Which state are you planning on operating in? (Each state has individual regulations regarding physician services, and they differ from one another).

Customer: replied 1 year ago.
oklahoma
Expert:  CalAttorney2 replied 1 year ago.

Dear Customer,

The primary obstruction to companies engaging in this type of business is the doctrine referred to as the "Corporate Practice of Medicine" (CPOM), and each state does differ (as noted above). Oklahoma is somewhat unique as there is no express statutory authority embodying this restriction, however, this principle has not been "tested" (at least not in any cases of record) and in engaging in such a business you would be engaging in a somewhat high risk business strategy. I would strongly encourage you to work with a local business attorney who has some experience in healthcare to assist you in structuring your business (while "advice of counsel" is not an absolute defense here, it can at least be used to try to mitigate damages if you end up on the wrong side of an enforcement action).

I would recommend reading the summary on Oklahoma law submitted as part of this compendium on CPOM laws by state: https://www.healthlawyers.org/Archive/Program%20Papers/1996_AM/[1996_AM]%20CORPORATE%20PRACTICE%20OF%20MEDICINE-%2050-STATE%20SURVEY.pdf (the attorney writing the portion for Oklahoma did a very thorough job, and provided some legal authorities for you to work with in assessing your situation - but again, I would strongly encourage you to work with an attorney).