Is Forming an LLC Enough to Start a Healthcare Practice?

Forming an entity gets a practice legally established, but it doesn't touch the licensing and credentialing a clinician still has to carry.

That's the point Nima Hashemi, Principal Product Manager at Bizee, makes in a recent Healthcare Business Today feature on what first-time healthcare founders need to know before they open their doors.

Structure is the first decision. Clinicians may be choosing between an LLC and a professional LLC, and weighing a possible S corporation election, all of which depends on their situation and should be worked through with qualified professional help. Then there's the layer other small businesses don't have.

"That's separate from your entity, and it doesn't get handled by forming one," Hashemi says of licensing and credentialing.

Part of why this catches people off guard is who becomes a practice owner.

"The reason a lot of clinicians join a health system or a provider group in the first place is that they don't want to deal with the logistics and the administrative burden," Hashemi says. "Their training is medical school. They're not privy to knowing the structure."

His advice is to do the same market research any founder does.

"You're understanding where the gaps are and what services you could provide that are unique against what already exists in that market."

He points to a dentist who researched her own ZIP code, found most local practices focused on general dentistry and orthodontics, and built her positioning around cosmetic work instead.

Specialists help. A CPA who works only with dentists will know the reporting deadlines and licensing obligations a general accountant won't. But Hashemi draws a line there:

"You can't just outsource all of it. You need to be in the know."

Growth is the same story.

"It's not about just acquiring new patients. It's about retaining them."