Updated: Oct 1
Starting a business can be a confusing process. There are several boxes to check at the State and Federal levels and it is hard to know where to start. In this post, we are going to boil down the process needed to incorporate your business into 8 simple steps. During this process, legal review can be invaluable, and we always suggest that when in doubt, have an experienced healthcare attorney confirm the process or State regulations.
Verify that you can start a healthcare business, and confirm what type of business (LLC, PLLC) it is that you need to start. The easiest and cheapest way to do this is by contacting your State's local board of medicine or board of nursing, whichever is applicable.
Decide on the name of the practice and check to see if it is available within by checking with your Secretary of State. To this, simply Google "see if a business name is taken (state name)", and select the Government website affiliated with your Secretary of State which will allow you to search for business names. If your potential name is not included in the search, then it is available.
Prior to proceeding with formally incorporating your business, getting business licenses, and checking other boxes, we recommend confirming that insurers in your area are currently credentialing Nurse Practitioners to their insurance panels.
Next, file with your state's Secretary of State to incorporate the business. You should be able to do this through the same site that you checked name availability in Step 2. The costs for incorporating the business vary by state and range from $40-$500, with an average of around $100.
Then, apply for your Employer Identification Number through the IRS. To do this, search "IRS small business apply for EIN" and select the IRS site that follows.
Form an operating agreement for your business. This is a legal document that typically serves to govern the internal operations of the business, which include, percentage ownership by the founders, voting rights, and distribution of profits, among other items. This is important as this agreement legally informs your State of agreements in between partners and confirms the limited liability status. In 1 member LLCs (if you are a sole practitioner and business owner) this is typically a simple document. Contact Neighborhood Nurse if you'd like us to provide a sample operating agreement.
Once the operating agreement is in place, look for business licenses required by your local government. Similar to the above steps, this can be accomplished with a simple search, or by contacting your local government directly.
Finally, you should secure the appropriate insurance for your business. There are two key types of insurance that you need to focus on:
Malpractice - If you are already covered under malpractice insurance, contact your carrier to confirm any modifications to your policy if you are in your own practice.
Worker's compensation insurance - This is only needed if you have employees.
General liability - This may only be needed if your practice has a brick-and-mortar location.
That's it! The 8-step map for nurse practitioners needing to incorporate their practice. Neighborhood Nurse has access to both legal and business resources that can help guide you through this process. In our next post, we will take the process a step further and will walk through the insurance credentialing process.