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Physician Assistants May Now Own Professional Corporations with Physicians or Podiatrists

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Nicole E. Stratton
Foster Swift Health Care Law Report
October 2010

On July 19, 2010, Michigan Senate Bills 026, 027, and 028 (the "Bills") were enacted to allow physician assistants ("PAs") to join professional service corporations and professional limited liability companies ("PLLCs") with physicians or podiatrists who perform the same professional services that the PA performs.  The Bills also prohibit PAs from forming PA-only professional service corporations or limited liability companies (with some exceptions for PA-only PLLCs and professional service corporations already in existence at the time of the Bill's enactment).

Prior to the enactment of the Bills, there were differing opinions on the position of a PA in PLLCs and professional service corporations. An Attorney General Opinion from the mid-1990s allowed PAs to form professional corporations with physicians.  Conversely, the Michigan Professional Service Corporation Act (the "Act"), beginning at MCL 450.221, required that all shareholders of a professional corporation render the "same professional services." Prior to enactment of the Bills, PAs were not considered as rendering the "same professional services" as physicians or podiatrists.  Thus, prior to enactment, PAs could only form professional corporations with other PAs.  The enactment of the Bills settled the discrepancies between the Attorney General Opinion and the Act.

In addition to settling the discrepancies about a PAs place in PLLCs and professional service corporations, the Bills also require a PA to disclose whether he or she is a shareholder in a PLLC or professional corporation when renewing his or her professional license.  Additionally, in the renewal application, a PA must disclose information about the professional service corporation or PLLC.  Specifically, the PA must disclose whether any physicians or podiatrists are shareholders or members, the name and license number of the supervising physician or podiatrist, and whether he or she is a member in the same professional service corporation or PLLC.

The Bills were effective immediately upon their passage.

The language from the Bills was added to MCL 333.17048.  MCL 333.17048 also contains PA supervision requirements.  These supervision requirements state that a physician who is a sole practitioner or who practices in a group of physicians and treats patients on an outpatient basis may not supervise more than 4 PAs.  If the physician supervises PAs at more than 1 practice site, then the physician may not supervise more than 2 PAs by a method other than the physician's actual physical presence at the practice site.  A physician employed by, under contract with, or who has privileges at a health facility may supervise more than 4 PAs at the health facility.