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LLC AND PLLC FORMATION FOR HEALTHCARE PROVIDERS

Which Entity Does Your State Actually Require? MedSole Finds Out and Forms It.

Most states require a specific entity type for licensed healthcare providers, and some restrict who can legally own it—physicians only in many cases, with narrow exceptions for related roles.

MedSole determines the correct structure for you: PLLC, PC, PA, or standard LLC, based on your state and your license. We also confirm who is allowed to hold ownership, so the entity you form is one you can operate under from day one.

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Find Your Entity

Find Your Entity

Tell us your state and license. We’ll tell you exactly what to form.

$349 flat service fee. State filing fees are charged separately.

99%

Clean Claim Rate

4,000+

Providers Served

50+

EHR/EMR Systems Supported

2.99%

of Collections

ENTITY TYPE AND OWNERSHIP

Which Entity Type, and Who’s Legally Allowed to Own It

Picking the right name for your entity solves half the problem. The other half is ownership, and most physicians never hear about it until a state board or bank forces the question later.

01

States Require Different Entity Types for the Same License

A state might mandate a PLLC for physicians. The state next door might use a PC instead, or a PA—the specific designation Texas uses for licensed professionals filing through its Secretary of State.

New Jersey does not permit PLLC formation at all. Licensed professionals there form a standard LLC instead, wholly owned by licensed professionals.

Healthcare provider reviewing state entity formation requirements
Healthcare professionals reviewing medical practice ownership requirements
02

Most States Also Restrict Who Can Own It

Corporate Practice of Medicine rules, active in most states, generally require a healthcare entity to be wholly or majority owned by licensed physicians holding an active, unrestricted license to practice.

A few states carve out narrow exceptions for physician assistants or nurse practitioners as co-owners.

03

What Happens If the Wrong Entity Gets Filed

An entity formed under the wrong designation—an LLC where a PLLC was required, or ownership held by someone the state does not permit—can be challenged later by a licensing board or a bank.

That challenge rarely surfaces at formation. It usually appears months later during credentialing, a loan application, or a licensing renewal.

Healthcare practice owner addressing an incorrect entity filing
LIABILITY PROTECTION, EXPLAINED HONESTLY

What Personal Liability Protection Actually Covers, and What It Doesn't

Most physicians assume their entity protects them the same way it protects any small business owner. It does, for some things. It doesn't, for the one thing most likely to actually happen.

Protected

What It Protects You From

An LLC, PLLC, or PC shields your personal assets—your home, your savings, and your car—from claims tied to the business itself. A vendor dispute, a lease default, or an employee's workplace injury claim stops at the entity, not you personally.

Not Protected

What It Doesn't Protect You From

It doesn't shield you from a malpractice claim tied to your own license. That protection comes from malpractice insurance, not your entity structure, regardless of which one you formed or how carefully.

A PLLC won't stop a malpractice suit from reaching you personally. Only your coverage does that, and MedSole makes sure you understand the difference before you assume you're covered.

WHAT COMES AFTER FORMATION

Formation Is the First Step, Not the Whole Structure

Most practices don't run on one entity. The clinical side stays physician-owned, the way Corporate Practice of Medicine rules require, while the business side often runs through a separate structure entirely.

BUSINESS STRUCTURE

A Separate Structure Handles the Business Side

A Management Services Organization handles billing, credentialing, and administrative work, legally separated from the clinical entity so non-physicians can own and run it.

That separation isn't optional in most states. It's the actual mechanism that lets a full-service RCM company operate alongside a physician-owned practice at all.

ONE CONTINUOUS RELATIONSHIP

MedSole Forms and Runs Both, Under One Relationship

Most formation services file your paperwork and disappear. MedSole forms the correct entity, then moves directly into credentialing, billing, and revenue cycle management.

There's no gap between having a legal entity and actually getting paid, since the same team handles formation and your revenue cycle from day one.

WHICH OF THESE APPLIES TO YOU

Which of these sounds like where you're starting from

Most physicians forming their first entity are working from guesses, not confirmed answers. Check what's actually true for you below.

Get a direct answer for your state and license

Tell us your state and license type. We'll confirm the correct entity, the ownership rules that apply, and what happens after formation. No cost, no obligation.

WHAT THIS COSTS

One flat fee to form your entity, correctly

$349 covers entity type, eligibility, and filing. Your state charges its own fee on top, typically $120 to $200.

ENTITY FORMATION
349 $
flat fee
State filing fee separate

One flat fee covers the setup work

MedSole charges $349 to determine your correct entity type, confirm ownership eligibility, and file everything.

Your state charges its own filing fee

It comes on top of MedSole's fee, typically $120 to $200 depending on where you're forming.

One payment to MedSole, one to your state

You pay MedSole once for the work. You pay your state separately for the filing itself, the same fee anyone pays regardless of who prepares it.

See what's included in your $349 fee
WHAT PRACTICES ASK

Questions Practices Ask About Payment Posting

These are the questions practices usually ask before handing posting off to someone else.

Still have a question we didn't cover?

Tell us what's going on with your posting, and someone who actually works remittances will get back to you.

Q1 What is payment posting in medical billing?

Payment posting is the step where a payer's remittance, an ERA file or a paper EOB, gets matched to the claim it's paying for. A biller checks the amount against your contracted rate, records any adjustment or write-off, and updates what the patient still owes. It happens after a claim gets paid or denied, and it's the step that shows whether the practice actually collected what it was owed.

Q2 What's the difference between an ERA and an EOB?

Both documents explain how a payer processed a claim, but they arrive differently. An ERA is an electronic remittance file that a system can read and post automatically, often covering many claims in one batch. An EOB is the paper or PDF version, usually covering a single claim, and it has to be read and entered by hand unless the payer offers an electronic option. Most payers send one or the other, and a practice working with several payers usually handles both.

Q3 Does payment posting cost extra if I'm already running full RCM with MedSole?

No. Payment posting doesn't carry its own charge. It's included in full-service RCM at 2.99% of collections, the same rate that covers registration, coding, claims, and AR follow-up. You're not billed twice for one piece of the cycle, and the team checking your remittances against your contracted rates is the same team already running the rest of your billing. If a shortfall shows up in posting, it often points to something upstream, and one team catches both instead of two vendors each seeing half the picture.

Q4 Is payment posting the same as AR follow-up?

No. Payment posting happens when a payment arrives and gets checked against the claim and your contracted rate. AR follow-up happens when a claim hasn't been paid at all, and someone has to chase the payer to find out why. A posting problem can turn into an AR problem if a short payment sits unflagged long enough, but they're two different jobs. MedSole runs both under one team, so a gap in one gets caught by the other instead of falling between them.

Q5 Can this work inside my existing EHR or practice management system?

Yes. We post payments directly inside the EHR or practice management system your practice already runs, whether that's an ERA file read automatically or a paper EOB entered by hand. Nothing moves to a separate platform, and your front desk sees the same claim record either way. If you use a clearinghouse for remittances, we work inside that too.

Q6 Is this HIPAA compliant?

Yes. We sign a Business Associate Agreement before we access a single remittance, and every payment we post moves through encrypted, HIPAA-compliant channels. Your practice keeps full access to every record at all times.

YOUR FREE REVIEW

See What Your Posting Is Actually Catching

A free review checks a sample of your recent remittances against your contracted rates and shows you where the gaps are. No cost, no obligation, and we sign a BAA before we look at anything.

No cost or obligation
BAA signed before remittance access
Contracted-rate gap review

Request Your Free Payment Posting Review

Share a few details so our team can review a sample of your remittances against your contracted rates.

Your information is secure and reviewed under a signed BAA.