How the structure works

An MSO cannot own your practice. That is the point.

California, like most states, prohibits a non-professional company from owning a clinical practice or directing clinical judgment. That rule is what makes a management services organization possible — and it is the reason a properly built MSO leaves you in control.

The doctrine

Corporate practice of medicine, in plain terms

The corporate practice of medicine doctrine holds that only licensed professionals, or entities owned by them, may practice a licensed profession. A general business corporation cannot employ physicians to practise medicine, cannot own a professional practice, and cannot make clinical decisions.

California applies this through the Medical Practice Act and the Moscone-Knox Professional Corporation Act, and analogous rules reach dentistry, optometry, veterinary medicine, psychology, physical therapy, speech-language pathology and nursing. The details differ by profession and by state; the principle does not.

The split

What stays with you, and what we take

Decision	Your practice entity	Practice Partner CPAs
Diagnosis, treatment plan, clinical protocols	Yours, always	No involvement
Coding and medical-necessity judgment	Yours, always	No involvement
Hiring and supervision of clinicians	Yours	We support recruiting; you decide
Which payers to contract with	Yours	We model the economics
Fee schedule and pricing	Yours	We benchmark and advise
Bookkeeping, payroll, tax filings	Delegated	Ours to run
Financial reporting and forecasting	Delegated	Ours to run
Ownership of the practice	100% yours	None. Ever.

The agreement

What a management services agreement actually contains

Scope of services: An itemised list of the administrative functions we perform — accounting, payroll, tax, reporting, advisory. Anything not listed is not ours.
Fee: A flat monthly amount for that scope. Not a share of collections, not a share of profit, and not equity. A fee tied to revenue invites the argument that the manager is sharing in professional fees, which is exactly the structure the doctrine is uneasy about.
Term and exit: Month to month with thirty days’ notice, or a twelve-month initial term that converts to month to month. Either way you can leave, and you leave with your books, files and system access.
Records and data: Your records remain yours. We hold them as a service provider, under a Business Associate Agreement, and we return them on request.
No clinical control: Express language that we do not direct, and have no authority over, clinical decisions, licensure, or the professional judgment of any provider.

This page explains a structure. It is not legal advice, and it is not a substitute for your own counsel reviewing any agreement you sign. If your attorney wants the management services agreement in advance of a call, we will send it.

An MSO cannot own your practice. That is the point.

Corporate practice of medicine, in plain terms

What stays with you, and what we take

What a management services agreement actually contains

Have your attorney read it first