Private Practice Entity

[vpsych]

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Hi everyone,

I am in the midst of leaving the private practice where I've been working the last 6 months. I live in NYS and my lawyer has already began forming my PLLC, but due to delays with the dept of education it is likely going to take 3-4 months to get this fully processed. My question is basically: can I still operate on my own with my individual NPI as a sole proprietor while waiting for my PLLC to be done? I realize the disadvantage would involve not having optimal liability coverage. But I'm curious if there is any legal reason why I wouldn't be able to still practice on my own without formally having an entity set up.

Thanks in advance.

 

[splik]

It's not that big of a deal. many people (particularly older people) practice as sole prop without PLLC etc. PLLC does not provide ANY protection in the event of a malpractice suit btw, which is your main type of liability. It might help protect personal assets in the event of slip and falls claims (e.g. if someone slips and injures themselves in your office) but you should have coverage for that anyway.

BTW, I currently practice as sole prop (though LLCs etc aren't allowed for physicians in my state). It's not worth my time to incorporate at the current time, but I will do so when it becomes financially advantageous to do so.

 

[vpsych]

It's not that big of a deal. many people (particularly older people) practice as sole prop without PLLC etc. PLLC does not provide ANY protection in the event of a malpractice suit btw, which is your main type of liability. It might help protect personal assets in the event of slip and falls claims (e.g. if someone slips and injures themselves in your office) but you should have coverage for that anyway.

BTW, I currently practice as sole prop (though LLCs etc aren't allowed for physicians in my state). It's not worth my time to incorporate at the current time, but I will do so when it becomes financially advantageous to do so.

Thank you for your response! Did you just get a DBA to open a business bank account? Or use personal account? If you don’t mind me asking.

 

[splik]

Thank you for your response! Did you just get a DBA to open a business bank account? Or use personal account? If you don’t mind me asking.

I don’t. You don’t really need this as a sole prop. Once you have your PLLC etc you will want to have this to separate your personal from your business assets and it might also help when doing g taxes in making business deductions clearer but for my purposes I haven’t needed it. You don’t need a DBA if you are just using your name for your practice. My bank offered my a business account as soon as o have my Google workspace for business but I haven’t taken them up on it yet

 

[michaelrack]

You should use a business checking account; separate from personal accounts

 

[calvnandhobbs68]

Thank you for your response! Did you just get a DBA to open a business bank account? Or use personal account? If you don’t mind me asking.

You can open a business banking account as a sole prop for most banks. PNC didn’t give me any issue with opening a business checking account just putting my personal info. It’s also much easier to “pay yourself” out of a business account and leave the appropriate amount for quarterly taxes in there, keeps you from the temptation of messing with that money.

Remember that most contracted physicians operate as sole props actually, it’s the most common “self employed” default in the country. As splik mentioned, for physicians since your main liability is malpractice, a LLC does very little to actually protect any assets until you’re actually employing employees or own an office space. If you’re just operating on your own (no employees) there’s very little difference between a sole prop and a PLLC.

 

[Sushirolls]

The choices now impact later.

If you ever want to hire more employees or even try to sell your proactice, having a discrete (P)LLC from the start can help.
Also, if doing insurance those contracts will be with your LLC. I have a few that did them with 'me' the indidividual and not my LLC. So if I were to bring on another doctor, I can't just simply update their NPI and name with the insurance company to have them paneled quickly, they will need to apply themselves, or I'll have to try and apply to get them to do a group NPI-II based contract now that there are more people. Either way you are looking at time and headaches and loss of money.

So in summary, the answer to your question is more contigent on what you are doing, what your goals are?

 

[clozareal]

Echoing what others have said, you can definitely start with a sole proprietorship while waiting for your PLLC to be made. I find this to be the more common approach than to start with a PLLC at the beginning. It takes like 5 minutes online on the IRS website to make a sole proprietorship.